<SUBMISSION>
<ACCESSION-NUMBER>0000899681-04-000830
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>8
<PERIOD>20041030
<FILING-DATE>20041209
<DATE-OF-FILING-DATE-CHANGE>20041209
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>CHILDRENS PLACE RETAIL STORES INC
<CIK>0001041859
<ASSIGNED-SIC>5651
<IRS-NUMBER>311241495
<FISCAL-YEAR-END>0131
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>000-23071
<FILM-NUMBER>041194075
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>915 SECAUCUS RD
<CITY>SECAUCUS
<STATE>NJ
<ZIP>07094
<PHONE>2015582400
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>915 SECAUCUS RD
<CITY>SECAUCUS
<STATE>NJ
<ZIP>07094
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>tcp-10q_120804.htm
<TEXT>
<HTML>
<HEAD>
<TITLE>Form 10-Q</TITLE>
</HEAD>
<BODY>

<P ALIGN=CENTER><FONT SIZE=3>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION<BR>
WASHINGTON, D. C. 20549</FONT></P>
<BR>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>FORM 10-Q</B></FONT></P>
<BR>

<P><FONT SIZE=3>(Mark One)</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>/X/</TD>
<TD WIDTH=95%>
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934<BR>
For the quarterly period ended October 30, 2004
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>/&nbsp;&nbsp;/</TD>
<TD WIDTH=95%>
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934<BR>
For the transition period from _____________ to _____________
</TD>
</TR>
</TABLE>
<BR>
<BR>

<P ALIGN=CENTER><FONT SIZE=3>Commission file number 0-23071</FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES, INC.</B><BR>
(Exact name of registrant as specified in its charter)</FONT></P>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=33% ALIGN=CENTER>
<B>Delaware</B><BR>
(State or other jurisdiction of<BR>
incorporation or organization)
</TD>
<TD WIDTH=34%>&nbsp;</TD>
<TD WIDTH=33% ALIGN=CENTER>
<B>31-1241495</B><BR>
(I. R. S. Employer Identification<BR>
Number)
</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>915 Secaucus Road<BR>
Secaucus, New Jersey 07094</B><BR>
(Address of principal executive offices) (Zip Code)</FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>(201) 558-2400</B><BR>
(Registrant's telephone number, including area code)</FONT></P>


<P><FONT SIZE=3>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. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=10%>Yes&nbsp;&nbsp;&nbsp;/X/</TD>
<TD WIDTH=85%>No&nbsp;&nbsp;&nbsp;/&nbsp;&nbsp;/</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>Indicate by check mark whether the registrant is an accelerated
filer.</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=10%>Yes&nbsp;&nbsp;&nbsp;/X/</TD>
<TD WIDTH=85%>No&nbsp;&nbsp;&nbsp;/&nbsp;&nbsp;/</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date.
</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=95%>
Common Stock, par value $0.10 per share, outstanding at December 7, 2004:
26,995,055 shares.
</TD>
</TR>
</TABLE>
<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES,
INC.</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>QUARTERLY REPORT ON FORM 10-Q</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>FOR THE PERIOD ENDED OCTOBER 30,
2004</B></FONT></P>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>TABLE OF CONTENTS</B></FONT></P>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>Part I - Financial Information</B></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>Item 1.</TD>
<TD WIDTH=80%>Consolidated Financial Statements:</TD>
<TD WIDTH=10% ALIGN=CENTER><U>Page</U></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=80%>Consolidated Balance Sheets</TD>
<TD WIDTH=10% ALIGN=CENTER>1</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=80%>Consolidated Statements of Income</TD>
<TD WIDTH=10% ALIGN=CENTER>2</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=80%>Consolidated Statements of Cash Flows</TD>
<TD WIDTH=10% ALIGN=CENTER>3</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=80%>Notes to Consolidated Financial Statements</TD>
<TD WIDTH=10% ALIGN=CENTER>4</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>Item 2.</TD>
<TD WIDTH=80%>Management's Discussion and Analysis of Financial Condition and
Results of Operations</TD>
<TD WIDTH=10% ALIGN=CENTER>10</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>Item 3.</TD>
<TD WIDTH=80%>Quantitative and Qualitative Disclosures about Market Risks</TD>
<TD WIDTH=10% ALIGN=CENTER>16</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>Item 4.</TD>
<TD WIDTH=80%>Controls and Procedures</TD>
<TD WIDTH=10% ALIGN=CENTER>16</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>Part II - Other Information</B></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>Item 1.</TD>
<TD WIDTH=80%>Legal Proceedings</TD>
<TD WIDTH=10% ALIGN=CENTER>17</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>Item 6.</TD>
<TD WIDTH=80%>Exhibits and Reports on Form 8-K</TD>
<TD WIDTH=10% ALIGN=CENTER>17</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=90%>Signatures</TD>
<TD WIDTH=10% ALIGN=CENTER>18</TD>
</TR>
</TABLE>
<BR>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>PART I - FINANCIAL INFORMATION</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>Item 1. CONSOLIDATED FINANCIAL
STATEMENTS</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES,
INC.<BR>
AND SUBSIDIARIES</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>CONSOLIDATED BALANCE SHEETS<BR>
(In thousands, except per share amounts)</B></FONT></P>

<PRE><FONT SIZE=1>
<B>                                                                October 30, 2004     January 31, 2004      November 1, 2003
                                                                ----------------     ----------------      ----------------
                                                                     (Unaudited)                                (Unaudited)</B>

                              <B>ASSETS</B>
Current assets:
    Cash and cash equivalents.................................         $  45,344            $  74,772             $  44,182
    Accounts receivable.......................................            14,249                8,462                12,747
    Inventories...............................................           143,367               96,128                95,893
    Prepaid expenses and other current assets.................            23,588               20,070                21,065
                                                                       ---------            ---------             ---------
       Total current assets...................................           226,548              199,432               173,887

Long-term assets:
    Property and equipment, net...............................           153,866              146,707               149,354
    Other assets..............................................            14,054               13,527                 9,200
                                                                       ---------            ---------             ---------
       Total assets...........................................         $ 394,468            $ 359,666             $ 332,441
                                                                       =========            =========             =========

     <B>LIABILITIES AND STOCKHOLDERS' EQUITY</B>

<B>LIABILITIES:</B>
Current liabilities:
    Accounts payable..........................................         $  40,721            $  35,173             $  34,152
    Income taxes payable......................................             6,979                9,733                 2,986
    Accrued expenses, interest and other current liabilities..            49,204               40,251                41,022
                                                                       ---------            ---------             ---------
       Total current liabilities..............................            96,904               85,157                78,160

Long-term liabilities:
    Deferred rent liabilities.................................            15,608               14,187                13,548
    Other long-term liabilities...............................                 0                3,317                 2,267
                                                                       ---------            ---------             ---------
       Total liabilities......................................           112,512              102,661                93,975
                                                                       =========            =========             =========

<B>COMMITMENTS AND CONTINGENCIES</B>

<B>STOCKHOLDERS' EQUITY:</B>
Common stock, $0.10 par value; 100,000,000 shares authorized;
    26,945,104 shares, 26,733,313 shares and 26,664,294 shares
    issued and outstanding, at October 30, 2004, January 31,
    2004 and November 1, 2003, respectively...................             2,694                2,673                 2,666
Additional paid-in capital....................................           103,963              101,288                99,747
Accumulated other comprehensive income........................             5,705                2,754                   938
Retained earnings.............................................           169,594              150,290               135,115
                                                                       ---------            ---------             ---------
       Total stockholders' equity.............................           281,956              257,005               238,466
                                                                       ---------            ---------             ---------
       Total liabilities and stockholders' equity.............         $ 394,468            $ 359,666             $ 332,441
                                                                       =========            =========             =========
</FONT></PRE>

<P ALIGN=CENTER><FONT SIZE=3>The accompanying notes to consolidated financial statements are
an integral part of these consolidated statements. </FONT></P>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES, INC.<BR>
AND SUBSIDIARIES</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>CONSOLIDATED STATEMENTS OF INCOME<BR>
(Unaudited)<BR>
(In thousands, except per share amounts)</B></FONT></P>

<PRE><FONT SIZE=1>
<B>                                                          Thirteen Weeks Ended                 Thirty-Nine Weeks Ended
                                                          --------------------                 -----------------------
                                                  October 30, 2004   November 1, 2003    October 30, 2004   November 1, 2003
                                                  ----------------   ----------------    ----------------   ----------------</B>

Net sales........................................        $ 280,496          $ 223,277           $ 695,440          $ 563,369
Cost of sales....................................          166,513            131,987             431,300            351,719
                                                         ---------          ---------           ---------          ---------

Gross profit.....................................          113,983             91,290             264,140            211,650
Selling, general and administrative expenses.....           74,010             62,083             200,914            169,462
Depreciation and amortization....................           10,493             10,154              31,195             29,557
                                                         ---------          ---------           ---------          ---------

Operating income.................................           29,480             19,053              32,031             12,631
Interest (income) expense, net...................              (48)                17                (154)              (128)
                                                         ---------          ---------           ---------          ---------

Income before income taxes.......................           29,528             19,036              32,185             12,759
Provision for income taxes.......................           11,845              7,424              12,881              4,977
                                                         ---------          ---------           ---------          ---------
Net income.......................................        $  17,683          $  11,612           $  19,304          $   7,782
                                                         =========          =========           =========          =========

Basic net income per common share................        $    0.66          $    0.44           $    0.72          $    0.29
Basic weighted average common shares outstanding.           26,928             26,640              26,867             26,620

Diluted net income per common share..............        $    0.65          $    0.43           $    0.70          $    0.29
Diluted weighted average common shares outstanding          27,393             27,153              27,475             26,961
</FONT></PRE>

<P ALIGN=CENTER><FONT SIZE=3>The accompanying notes to consolidated financial
statements are an integral part of these consolidated statements. </FONT></P>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES, INC.<BR>
AND SUBSIDIARIES</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>CONSOLIDATED STATEMENTS OF CASH FLOWS<BR>
(Unaudited)<BR>
(In thousands)</B></FONT></P>

<PRE><FONT SIZE=1>
<B>                                                                                        Thirty-Nine Weeks Ended
                                                                                        -----------------------
                                                                               October 30, 2004        November 1, 2003
                                                                               ----------------        ----------------</B>

<B>CASH FLOWS FROM OPERATING ACTIVITIES:</B>
Net income..................................................................          $  19,304               $   7,782
Adjustments to reconcile net income to net cash provided by
    operating activities:
       Depreciation and amortization........................................             31,195                  29,557
       Deferred financing fee amortization..................................                 44                      45
       Loss on disposals of property and equipment..........................                495                     314
       Deferred taxes.......................................................                803                     (64)
       Deferred rent........................................................              1,604                   1,788
Changes in operating assets and liabilities:
       Accounts receivable..................................................             (5,707)                  1,158
       Inventories..........................................................            (46,061)                (19,610)
       Prepaid expenses and other current assets............................             (2,880)                 (1,394)
       Other assets.........................................................             (2,607)                     58
       Accounts payable.....................................................              5,210                   3,062
       Income taxes payable.................................................             (2,754)                  2,788
       Accrued expenses, interest and other current liabilities.............              5,399                   6,791
                                                                                      ---------               ---------
          Total adjustments.................................................            (15,259)                 24,493
                                                                                      ---------               ---------
Net cash provided by operating activities...................................              4,045                  32,275
                                                                                      ---------               ---------

<B>CASH FLOWS FROM INVESTING ACTIVITIES:</B>
Property and equipment purchases............................................            (37,164)                (25,642)
                                                                                      ---------               ---------
Net cash used in investing activities.......................................            (37,164)                (25,642)
                                                                                      ---------               ---------

<B>CASH FLOWS FROM FINANCING ACTIVITIES:</B>
Exercise of stock options and employee stock purchases......................              2,696                     991
Deferred financing costs....................................................                  0                    (175)
Borrowings under revolving credit facility..................................             99,150                  62,337
Repayments under revolving credit facility..................................            (99,150)                (62,337)
                                                                                      ---------               ---------
Net cash provided by financing activities...................................              2,696                     816
                                                                                      ---------               ---------
Effect of exchange rate changes on cash.....................................                995                      88
                                                                                      ---------               ---------
       Net decrease in cash and cash equivalents............................            (29,428)                  7,537
       Cash and cash equivalents, beginning of period.......................             74,772                  36,645
                                                                                      ---------               ---------
Cash and cash equivalents, end of period....................................          $  45,344               $  44,182
                                                                                      =========               =========

<B>OTHER CASH FLOW INFORMATION:</B>
Cash paid during the period for interest....................................          $      18               $     237
Cash paid during the period for income taxes................................             15,841                   1,337
</FONT></PRE>

<P ALIGN=CENTER><FONT SIZE=3>The accompanying notes to consolidated financial statements are
an integral part of these consolidated statements. </FONT></P>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES, INC.<BR>
AND SUBSIDIARIES</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Unaudited)</B></FONT></P>

<P><FONT SIZE=3><B>1. BASIS OF PRESENTATION</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The accompanying unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
("GAAP") for interim financial information. Certain information and
footnote disclosures required by GAAP for complete financial statements have
been condensed or omitted pursuant to the rules and regulations of the
Securities and Exchange Commission. In the opinion of management, the
accompanying unaudited financial statements contain all material adjustments,
consisting of normal recurring accruals, necessary to present fairly the
Company's financial position, results of operations and cash flows for the
periods indicated, and have been prepared in a manner consistent with the
audited financial statements as of January 31, 2004. These financial statements
should be read in conjunction with the audited financial statements and
footnotes for the fiscal year ended January 31, 2004 included in the
Company's Annual Report on Form 10-K for the year ended January 31, 2004
filed with the Securities and Exchange Commission. Due to the seasonal nature of
the Company's business, the results of operations for the thirty-nine weeks
ended October 30, 2004 and November 1, 2003 are not necessarily indicative of
operating results for a full fiscal year. </FONT></P>

<P><FONT SIZE=3><B>2. STOCK BASED COMPENSATION</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company accounts for its stock option plans and its employee stock purchase
plan under the intrinsic value method described in the provisions of Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees". Accordingly, no compensation expense has been recognized for
stock-based compensation since the options granted were at prices that equaled
or exceeded their estimated fair market value at the date of grant. If
compensation expense for the Company's stock options and employee stock
purchases issued during the thirteen weeks and thirty-nine weeks ended October
30, 2004 and November 1, 2003 had been determined based on the fair value method
of accounting, in accordance with Statement of Financial Accounting Standards
("SFAS") No. 123, "Accounting for Stock-Based Compensation,"
and the disclosure requirements of SFAS No. 148, "Accounting for
Stock-Based Compensation, Transition and Disclosure", the Company's
net income would have been adjusted to the pro forma amounts indicated below for
the thirteen weeks and thirty-nine weeks ended October 30, 2004 and November 1,
2003, respectively: </FONT></P>

<PRE><FONT SIZE=1>
<B>                                                            Thirteen Weeks Ended               Thirty-Nine Weeks Ended
                                                            --------------------               -----------------------
                                                   October 30, 2004  November 1, 2003    October 30, 2004  November 1, 2003
                                                   ----------------  ----------------    ----------------  ----------------</B>

Net  income - (in thousands)
     As reported...................................        $ 17,683          $ 11,612            $ 19,304          $  7,782
     Deduct: Total stock-based compensation expense
     determined under fair value based method for
     all awards, net of related tax effects........           1,418             1,107               4,422             3,230
                                                           --------          --------            --------          --------
     Pro forma.....................................        $ 16,265          $ 10,505            $ 14,882          $  4,552

Earnings per share -
     Basic - as reported...........................        $   0.66          $   0.44            $   0.72          $   0.29
     Basic - pro forma.............................        $   0.60          $   0.39            $   0.55          $   0.17

     Diluted - as reported.........................        $   0.65          $   0.43            $   0.70          $   0.29
     Diluted - pro forma...........................        $   0.59          $   0.39            $   0.54          $   0.17
</FONT></PRE>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES, INC.<BR>
AND SUBSIDIARIES<BR>
<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Unaudited)</B></FONT></P>


<P><FONT SIZE=3><B>3. NET INCOME PER COMMON SHARE</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS No. 128, "Earnings Per Share," the following
table reconciles net income and share amounts utilized to calculate basic and
diluted net income per common share. </FONT></P>

<PRE><FONT SIZE=1>
<B>                                                  Thirteen Weeks Ended                  Thirty-Nine Weeks Ended
                                                  --------------------                  -----------------------
                                        October 30, 2004    November 1, 2003     October 30, 2004    November 1, 2003
                                        ----------------    ----------------     ----------------    ----------------</B>

Net  income (in thousands).............     $     17,683        $     11,612         $     19,304        $      7,782
                                            ============        ============         ============        ============

Basic shares...........................       26,928,437          26,640,052           26,866,850          26,619,629
Dilutive effect of stock options.......          465,086             513,155              608,080             341,688
                                            ------------        ------------         ------------        ------------
Dilutive shares........................       27,393,523          27,153,207           27,474,930          26,961,317
                                            ============        ============         ============        ============

Antidilutive options...................        1,510,132             747,497            1,046,903           1,052,252
</FONT></PRE>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Antidilutive options consist of the weighted average of stock options for the
respective periods ended October 30, 2004 and November 1, 2003 that had an
exercise price greater than the average market price during the period. Such
options are therefore excluded from the computation of diluted shares.
</FONT></P>

<P><FONT SIZE=3><B>4. COMPREHENSIVE INCOME</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table presents the Company's comprehensive income (in thousands):
</FONT></P>

<PRE><FONT SIZE=1>
<B>                                                Thirteen Weeks Ended                     Thirty-Nine Weeks Ended
                                                --------------------                     -----------------------
                                        October 30, 2004    November 1, 2003     October 30, 2004   November 1, 2003
                                        ----------------    ----------------     ----------------   ----------------</B>

Net income   ..........................          $17,683             $11,612              $19,304            $ 7,782
Translation adjustments................            3,025                 334                2,951                685
                                                 -------             -------              -------            -------
Comprehensive income...................          $20,708             $11,946              $22,255            $ 8,467
                                                 =======             =======              =======            =======
</FONT></PRE>

<P><FONT SIZE=3><B>5. DERIVATIVE INSTRUMENTS</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities," ("SFAS No. 133"), as amended and interpreted,
requires that each derivative instrument (including certain derivative
instruments embedded in other contracts) be recorded in the balance sheet as
either an asset or liability and measured at its fair value. The statement also
requires that changes in the derivative's fair value be recognized
currently in earnings in either income from continuing operations or accumulated
other comprehensive income, depending on whether the derivative qualifies for
hedge accounting treatment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Commencing in the second quarter of 2004, the Company began using foreign
currency forward contracts for the specific purpose of reducing the exposure to
variability in forecasted cash flows associated primarily with inventory
purchases for the Company's Canadian operations. These instruments are not
designated as hedges and, in accordance with SFAS No. 133, the changes in fair
value are included in current period earnings. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At October 30, 2004, the Company had forward contracts maturing through January
2005 for its Canadian operations to buy $4.3 million U.S. dollars for $5.7
million Canadian dollars. The Company's Canadian operations uses Canadian
dollars as its functional currency, but purchases most of its merchandise in
U.S. dollars. The Company has recorded an unrealized pre-tax loss of
approximately $385,000 and $376,000 in its earnings for the thirteen weeks and
thirty-nine weeks ending October 30, 2004, respectively, to record these
contracts to their market value. The forward contracts are recorded at their
fair market value at October 30, 2004. </FONT></P>
<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES, INC.<BR>
AND SUBSIDIARIES<BR>
<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Unaudited)</B></FONT></P>

<P><FONT SIZE=3><B>6. CREDIT FACILITIES</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Wells Fargo Credit Facility</B> </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to October 30, 2004, the Company had a credit facility (the "Original
Wells Fargo Credit Facility") with Wells Fargo Retail Finance, LLC
("Wells Fargo"). The Original Wells Fargo Credit Facility provided for
up to $85 million in borrowings, which included a sublimit of up to $80 million
in letters of credit. Wells Fargo acted as the Company's agent bank for a syndicated group
of lenders, under this facility. This credit facility also contained provisions to
increase borrowings up to $120 million (including a sublimit for letters of
credit of $100 million), subject to sufficient collateralization and the
syndication of the incremental line of borrowing. The amount that could be
borrowed under the credit facility depended on the Company's levels of
inventory and accounts receivable. The Original Wells Fargo Credit Facility
would have expired in April 2006 and provided for one-year renewal options.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Original Wells Fargo Credit Facility also contained covenants, which
included limitations on the Company's annual capital expenditures, the
maintenance of certain levels of excess collateral, and a prohibition on the
payment of dividends. Credit extended under the Original Wells Fargo Credit
Facility was secured by a first priority security interest in all of the
Company's assets, except for assets in Canada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Noncompliance with these covenants could result in additional fees, could affect
the Company's ability to borrow, or could require the Company to repay the
outstanding balance. Amounts outstanding under the Original Wells Fargo Credit
Facility bore interest at a floating rate equal to the prime rate or, at the
Company's option, a LIBOR rate plus a pre-determined spread. The LIBOR
spread was 1.50% to 3.00% depending on the Company's level of availability
from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of October 30, 2004, the Company amended and restated its credit facility
with Wells Fargo ("the Amended Loan Agreement"), partly in connection
with its acquisition of the Disney Store retail chain (See Footnote 10 &#150;
Subsequent Events). The terms of the Amended Loan Agreement are substantially
the same as the Original Wells Fargo Credit Facility except the Amended Loan
Agreement provides for borrowings up to $130 million (including a sublimit for
letters of credit of $100 million) and extends the term of the facility until
November 1, 2007 with successive one-year renewal options. In addition, the
Amended Loan Agreement provides for a temporary over-advance facility under
which the Company will have the right to borrow up to $30 million through
December 31, 2004, regardless of the amount of collateral. The Amended Loan
Agreement is secured by a first priority security interest in substantially all
the assets of the Company and its subsidiaries, other than assets in Canada and
assets owned by the Company's subsidiaries that were formed in connection
with the acquisition of the Disney Stores business in North America.
Amounts outstanding under the Amended Loan Agreement bear interest at a floating
rate equal to the prime rate or, at the Company's option, a LIBOR rate plus
a pre-determined spread. The LIBOR spread will be 1.50% to 3.00%, depending on
the Company's level of availability from time to time, except that the
LIBOR spread for over-advances will be 4%. The Company expects to use borrowings
under the Amended Loan Agreement for working capital purposes and to support the
acquisition of the Disney Stores. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company had no outstanding borrowings under its Amended Loan Agreement as of
October 30, 2004 and had letters of credit outstanding of $55.1 million. During
the thirty-nine weeks ended October 30, 2004, the Company's borrowings
under its credit facility represented overnight borrowings for letters of credit
that cleared after business hours. The average balance during the thirty-nine
weeks ended October 30, 2004 was approximately $563,000 and the average interest
rate was 4.27%. The maximum outstanding letters of credit were $60.1 million
during the thirty-nine weeks ended October 30, 2004. Availability under the
Amended Loan Agreement as of October 30, 2004 was $74.9 million. As of October
30, 2004, the Company was in compliance with all of its covenants under the
Amended Loan Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of November 21, 2004, in conjunction with the Company's acquisition of the
Disney Stores, the Company entered into a separate credit facility for its new
subsidiary which operates this business. In addition, on November 22, 2004, the Company borrowed
approximately $53.8 million under the Amended Loan Agreement to satisfy a
portion of its payment obligations in connection with the acquisition of the
Disney Stores. (see Footnote 10-Subsequent Events)</FONT></P>
<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES, INC.<BR>
AND SUBSIDIARIES<BR>
<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Unaudited)</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>6. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
CREDIT FACILITIES (continued)</B></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Toronto Dominion Credit Facility</B> </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has a $8.2 million credit facility with Toronto Dominion Bank (the
"Toronto Dominion Credit Facility") to support its Canadian
subsidiary. As of October 30, 2004, the Toronto Dominion Credit Facility was
secured by a standby letter of credit issued under the Amended Loan Agreement
with Wells Fargo to permit up to $1.8 million in borrowings. As of October 30,
2004, there were no borrowings and no letters of credit outstanding under the
Toronto Dominion Credit Facility. During the thirty-nine weeks ended October 30,
2004, the Company did not borrow under the Toronto Dominion Credit Facility. The
Toronto Dominion Bank can demand repayment and cancel the availability of the
Toronto Dominion Credit Facility at any time. </FONT></P>

<P><FONT SIZE=3><B>7. INSURANCE PROCEEDS</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the thirty-nine weeks ended November 1, 2003, the Company received
approximately $1.5 million in a partial settlement of its business interruption
claim for its World Trade Center store. These proceeds reduced selling, general
and administrative expenses on the Company's consolidated statements of
income. </FONT></P>

<P><FONT SIZE=3><B>8. LITIGATION</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is involved in various legal proceedings arising in the normal
course of its business. In the opinion of management, any ultimate liability
arising out of such proceedings will not have a material adverse effect on the
Company's financial position or results of operations. </FONT></P>

<P><FONT SIZE=3><B>9. INCOME TAXES</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company computes income taxes using the liability method. This standard
requires recognition of deferred tax assets and liabilities, measured by enacted
rates, attributable to temporary differences between financial statement and
income tax basis of assets and liabilities. Temporary differences result
primarily from accelerated depreciation and amortization for tax purposes and
various accruals and reserves being deductible for future tax periods. The
income tax provision recorded for the thirty-nine weeks ended October 30, 2004
reflects the Company's estimated expected annual effective tax rate.
</FONT></P>

<P><FONT SIZE=3><B>10. SUBSEQUENT EVENTS</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Acquisition of The Disney Store</B> </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On November 22, 2004 (effective as of November 21, 2004), two subsidiaries of
the Company consummated the acquisition of the "Disney Store" chain of
retail stores in North America (the "Acquisition"), pursuant to the
terms of the Acquisition Agreement dated as of October 19, 2004 (the
"Acquisition Agreement"), between such subsidiaries of the Company,
as purchasers (the "Purchasers"), and two subsidiaries of The Walt
Disney Company, as sellers (the "Sellers"). Pursuant to the terms of
the Acquisition Agreement, the Purchasers acquired 100% of the outstanding
equity interests in The Disney Store, LLC ("TDS USA") and 100% of the
outstanding shares of capital stock of The Disney Store (Canada) Ltd. ("TDS
Canada") from the Sellers. As a result of the Acquisition, a total of 313
Disney Stores, consisting of all existing Disney Stores in the United States and
Canada, other than "flagship" stores and stores located at Disney
theme parks and other Disney properties, along with certain other assets used in
the Disney Store business, became owned and operated by subsidiaries of the
Company and the lease obligations for all 313 stores and other legal obligations
of TDS USA and TDS Canada became obligations of subsidiaries of the Company.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In consideration for the transfer by the Sellers to the Purchasers of the equity
interests in TDS USA and TDS Canada, an estimated working capital payment in the
amount of $101.4 million became payable to the Sellers in connection with the
consummation of the Acquisition. The amount of this working capital payment,
which is subject to adjustment, primarily reflected the level of inventory at
the Disney Stores for the 2004 holiday season as of November 21, 2004 as well as
a reduction in accounts payable prior to consummation of the Acquisition. Of
this amount, $45.4 million was paid to the Sellers by the Company and</FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN'S PLACE RETAIL STORES, INC.<BR>
AND SUBSIDIARIES<BR>
<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Unaudited)</B></FONT></P>


<P><FONT SIZE=3><B>10. SUBSEQUENT EVENTS (continued)</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Acquisition of The Disney Store (continued)</B> </FONT></P>



<P><FONT SIZE=3>$40.0 million was paid to the Sellers by TDS USA, as permitted
by the Acquisition Agreement, on November 22, 2004. Payment of the remaining
$16.0 million is due from The Children's Place Retail Stores, but has been
deferred for up to one month in accordance with the Acquisition Agreement. Such
amount will bear interest until the date of payment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pursuant to a Guaranty and Commitment entered into in connection with the
Acquisition (the "Guaranty and Commitment"), the Company invested $50 million
into its new subsidiary Hoop Retail Stores, LLC ("Hoop USA"), which merged with
TDS USA following the Acquisition, with Hoop USA surviving the merger. Hoop USA
now operates the business of the Disney Store in the United States and
indirectly owns the entire equity interest in Hoop Canada, Inc. ("Hoop Canada"),
the entity that operates the business of the Disney Store in Canada following a
merger of TDS Canada into Hoop Canada upon the closing of the Acquisition, with
Hoop Canada surviving the merger. Under the terms of the Guaranty and
Commitment, the Company is obligated to invest up to an additional $50 million
in Hoop USA, as necessary, from time to time in the future to enable Hoop USA
and Hoop Canada to comply with their obligations and operate the Disney Store
business. Pursuant to the Guaranty and Commitment, the Company also agreed to
guarantee the payment and performance by Hoop USA and its Canadian operating
subsidiary and certain of their affiliates of their royalty payment and other
obligations to TDS Franchising LLC, a subsidiary of The Walt Disney Company,
under a License and Conduct of Business Agreement that was entered into in
connection with the Acquisition (the "License Agreement"), subject to a maximum
liability of The Children's Place Retail Stores of $25 million. In addition,
under the License Agreement, until the achievement of certain operating results,
Hoop USA is restricted from paying dividends to The Children's Place Retail
Stores. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company funded its capital commitment for the Acquisition and its portion of
the working capital payment partially through cash on hand and partially through
short-term borrowings under its recently expanded credit facility under which
Wells Fargo serves as agent (described in Footnote 6 &#150; Credit Facilities).
TDS USA funded its $40 million portion of the working capital payment, and the
issuance of $23.0 million of standby letters of credit to the Sellers as
required by the Acquisition Agreement (primarily for the purpose of backing up
the Sellers' obligations for merchandise on order and freight services), by
drawing upon a newly established credit facility for The Disney Store, which is
described below. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pursuant to the terms of the License Agreement, Hoop USA and Hoop Canada will
operate retail stores in the United States and Canada using the "Disney Store"
name and such stores will contract to manufacture, source, offer and sell
merchandise featuring "Disney-branded" characters, past, present and future. For
additional information about the Acquisition and the terms of the Acquisition
Agreement and the License Agreement, see the Company's Current Reports on Form
8-K dated October 19, 2004 and November 22, 2004. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>The Disney Store Credit Facility</B> </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the consummation of the Acquisition, TDS USA and its
successor Hoop USA and the subsidiaries of Hoop USA, as guarantors, entered into
a Loan and Security Agreement (the "Hoop Loan Agreement") dated as of
November 21, 2004 with certain financial institutions and Wells Fargo, as
administrative agent, establishing a senior secured credit facility for the
Disney Store business. The Hoop Loan Agreement provides for borrowings and
letters of credit up to $100 million, subject to the amount of eligible
inventory and accounts receivable of Hoop USA from time to time. The term of the
facility extends until November 1, 2007. Amounts outstanding under the Hoop Loan
Agreement will bear interest at a floating rate equal to the prime rate plus a
pre-determined margin or, at Hoop USA's option, the LIBOR rate plus a
pre-determined margin. The prime rate margin will be 0.25% and the LIBOR margin
will be 2.0% or 2.25%, depending on Hoop USA's level of excess availability
from time to time. The Hoop Loan Agreement contains various covenants, including
limitations on indebtedness, maintenance of certain levels of excess collateral
and restrictions on the payment of dividends and payment of any indebtedness of
Hoop USA and Hoop Canada held by the Company. Credit extended under the Hoop
Loan Agreement is secured by a first priority security interest in substantially
all the assets of Hoop USA and Hoop Canada as well as a pledge of a portion of
the equity interests in Hoop Canada. Borrowings and letters of credit under the
Hoop Loan Agreement will be used by Hoop USA and its subsidiary Hoop Canada for
working capital purposes for the Disney Stores. In addition, a portion of the
borrowings under the Hoop Loan Agreement at the time of consummation of the
Acquisition were used to satisfy a portion of the payment obligations owed to
the Sellers in connection with the Acquisition. </FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF<BR>
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>This Quarterly Report on Form 10-Q contains forward-looking statements within
the meaning of federal securities laws, which are intended to be covered by the
safe harbors created thereby. Those statements include, but may not be limited
to, the discussions of the Company's operating and growth strategy.
Investors are cautioned that all forward-looking statements involve risks and
uncertainties including, without limitation, those set forth under the caption
"Risk Factors" in the Business section of the Company's Annual
Report on Form 10-K for the year ended January 31, 2004. Although the Company
believes that the assumptions underlying the forward-looking statements
contained herein are reasonable, any of the assumptions could prove to be
inaccurate, and therefore, there can be no assurance that the forward-looking
statements included in this Quarterly Report on Form 10-Q will prove to be
accurate. In light of the significant uncertainties inherent in the
forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by the Company or any other person
that the objectives and plans of the Company will be achieved. The Company
undertakes no obligation to publicly release any revisions to any
forward-looking statements contained herein to reflect events and circumstances
occurring after the date hereof or to reflect the occurrence of unanticipated
events.</I> </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>The following discussion should be read in conjunction with the
Company's unaudited financial statements and notes thereto included
elsewhere in this Quarterly Report on Form 10-Q and the annual audited financial
statements and notes thereto included in the Company's Annual Report on
Form 10-K for the year ended January 31, 2004, filed with the Securities and
Exchange Commission.</I> </FONT></P>

<P><FONT SIZE=3><B>Critical Accounting Policies</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The preparation of consolidated financial statements in conformity with
accounting principles generally accepted in the United States requires us to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements, as well as the reported revenues and expenses
during the reported period. Actual results could differ from our estimates. The
accounting policies that we believe are the most critical to aid in fully
understanding and evaluating reported financial results include the following:
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Revenue Recognition</B> &#150; Sales are recognized upon purchase by
customers at our retail stores or when shipped to our customers from our
distribution center if the product was purchased via the Internet, net of coupon
redemptions and anticipated sales returns. Actual sales return rates have
historically been within our expectations and the allowance established.
However, in the event that the actual rate of sales returns by customers
increased significantly, our operational results could be adversely affected.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our policy with respect to gift cards is to record revenue as the gift cards are
redeemed for merchandise. Prior to their redemption, unredeemed gift cards are
recorded as a liability, included within accrued expenses and other current
liabilities on the accompanying consolidated balance sheets. We have not reduced
our gift card liabilities for gift cards that are not expected to be redeemed.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We offer private label credit card customers a discount on future purchases,
once they have made purchases that exceed an annual minimum. We estimate the
future discounts to be provided based on prior year history, the number of
customers who have earned or are likely to earn the discount and current year
sales trends on the private label credit card. We defer a proportionate amount
of revenue from customers based on an estimated value of future discounts. We
recognize such deferred revenue as future discounts are taken on sales above the
annual minimum. This is done by utilizing estimates based upon sales trends and
the number of customers who have earned the discount privilege. All deferred
revenue is recognized by the end of the fiscal year, as our private label
customers must earn the discount privilege on an annual basis, and such
privilege expires prior to our fiscal year end. As of October 30, 2004,
approximately $705,000 in revenue has been deferred and will be recognized over
the remainder of fiscal 2004. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Inventory Valuation</B> &#150; Merchandise inventories are stated at the
lower of average cost or market, using the retail inventory method. Under the
retail inventory method, the valuation of inventories at cost and the resulting
gross margins are calculated by applying a cost-to-retail ratio to the retail
value of inventories. At any one time, inventories include items that have been
marked down to our best estimate of their fair market value. We base our
decision to mark down merchandise upon its current rate of sale, the season, age
and sell-through of the item. To the extent that our estimates differ from
actual results, additional markdowns may have to be recorded, which could reduce
our gross profit and operating results. Our success is largely dependent upon
our ability to gauge the fashion taste of our customers and provide a
well-balanced merchandise assortment that satisfies customer demand. Any
inability to provide the proper quantity of appropriate merchandise in a timely
manner could increase future markdown rates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Impairment of Assets</B> &#150; We continually evaluate each store's
performance and measure the carrying value of each location's fixed assets,
principally leasehold improvements and fixtures, versus its projected cash
flows. An impairment loss is recorded if the projected future cash flows are
insufficient to recapture the net book value of their assets. To the extent our
estimates of future cash flows are incorrect, additional impairment charges may
be recorded in future periods. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Litigation</B> &#150; We are involved in various legal proceedings arising in
the normal course of our business. In our opinion, any ultimate liability
arising out of such proceedings will not have a material adverse effect on our
business. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Stock Options</B> &#150; We record no compensation expense on our financial
statements for stock-based compensation, since we grant stock options at prices
that equal or exceed the fair market value of the related shares at the date of
the grant. If, in the future, we elect or are required to adopt fair value
accounting for our stock-based compensation, the related compensation charge
will adversely impact net income. In addition, increases to our stock price
would result in more diluted shares outstanding and reduce our diluted net
income per common share. </FONT></P>

<P><FONT SIZE=3><B>Results of Operations</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth, for the periods indicated, selected income
statement data expressed as a percentage of net sales: </FONT></P>

<PRE><FONT SIZE=1>
<B>                                                           Thirteen Weeks Ended                 Thirty-Nine Weeks Ended
                                                           --------------------                 -----------------------
                                                 October 30, 2004   November 1, 2003     October 30, 2004   November 1, 2003
                                                 ----------------   ----------------     ----------------   ----------------</B>

Net sales.......................................            100.0%             100.0%               100.0%             100.0%
Cost of sales...................................             59.4               59.1                 62.0               62.4
                                                             ----               ----                 ----               ----

Gross profit....................................             40.6               40.9                 38.0               37.6
Selling, general and administrative expenses....             26.4               27.8                 28.9               30.1
Depreciation and amortization...................              3.7                4.6                  4.5                5.2
                                                             ----               ----                 ----               ----

Income before income taxes......................             10.5                8.5                  4.6                2.3
Provision for income taxes......................              4.2                3.3                  1.8                0.9
                                                             ----               ----                 ----               ----
Net income......................................              6.3%               5.2%                 2.8%               1.4%
                                                             ====               ====                 ====               ====

Number of stores, end of period.................              734                689                  734                689
</FONT></PRE>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective November 21, 2004, we acquired the business of the Disney Stores in
the United States and Canada. Accordingly, our future reported results will
include the Disney Stores. </FONT></P>

<P><FONT SIZE=3><B>Thirteen Weeks Ended October 30, 2004 (the "Third
Quarter 2004") Compared to Thirteen Weeks Ended November 1,2003 <BR>(the
"Third Quarter 2003")</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net sales increased by $57.2 million, or 26%, to $280.5 million during the Third
Quarter 2004 from $223.3 million during the Third Quarter 2003. During the Third
Quarter 2004, we opened 19 new stores: 11 stores in the United States, seven
stores in Canada and one store in Puerto Rico. Our comparable store sales
increased 18% and contributed $37.3 million of our net sales increase in the
Third Quarter 2004. Our comparable store sales increase was primarily the result
of a 13% increase in the number of comparable store sales transactions and a 4%
increase in our average dollar transaction size. Comparable store sales
increased 14% during the Third Quarter 2003. Net sales for the 19 new stores, as
well as other stores that did not qualify as comparable stores, increased our
net sales by $19.9 million. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the Third Quarter 2004, we achieved double-digit comparable store sales
increases across all our geographical regions, departments and store types. Our
West, Canada, Southwest and Rocky Mountain regions reported the strongest
comparable store sales increases. By department, our accessories and newborn
departments achieved the highest comparable store sales increases. Our annual
profitability is highly dependent on our sales and gross margin performance
during the third and fourth quarters, which represents the back-to-school and
holiday selling seasons. During the four weeks ended November 27, 2004, our
comparable store sales increased 9% as compared to a 14% comparable store sales
increase for the four weeks ended November 29, 2003. We are unable to predict if
our current sales trends will continue throughout the remainder of the holiday
season. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Gross profit increased by $22.7 million to $114.0 million during the Third
Quarter 2004 from $91.3 million during the Third Quarter 2003. As a percentage
of net sales, gross profit decreased to 40.6% during the Third Quarter 2004 from
40.9% during the Third Quarter 2003. The decrease in gross profit, as a
percentage of net sales, was principally due to a lower initial markup and
higher markdowns, production and design costs, partially offset by the
leveraging of occupancy costs over a larger sales base. During the Third Quarter
2004, our initial markup was lower by 2.2%, as a percentage of net sales, due to
our continuing investment in the quality of our garments and the receipt of a
larger proportion of basic merchandise, which carries a lower initial markup. In
addition, during the Third Quarter 2004, markdowns and production and design
costs were higher by 0.4%, as a percentage of net sales. Due to our favorable
sales, occupancy costs decreased 2.3% as a percentage of net sales. During the
Third Quarter 2004, we continued our strategic acceleration of merchandise
receipts, which we believe provides us with greater flexibility, enhances
product flows to our stores and improves floorset execution of new season
merchandise. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Selling, general and administrative expenses increased $11.9 million to $74.0
million during the Third Quarter 2004 from $62.1 million during the Third
Quarter 2003. Selling, general and administrative expenses decreased to 26.4% of
net sales during the Third Quarter 2004 from 27.8% of net sales during the Third
Quarter 2003. This decrease, as a percentage of net sales, was due primarily to
lower marketing expenses and the leveraging of store payroll, partially offset
by higher medical expenses. During the Third Quarter 2004, marketing costs were
1.0% lower as a percentage of net sales than during the Third Quarter 2003, due
primarily to lower direct marketing costs. Our direct marketing costs were lower
in the Third Quarter 2004 as a result of smaller distributions and lower
production costs for our customer mailings. During the Fourth Quarter 2004, we
have launched a marketing campaign that includes television advertising
in four test markets (including the New York metropolitan area). Due to our
strong comparable store sales performance during the Third Quarter 2004, our
store payroll expenses were 0.6% lower, as a percentage of net sales, than the
Third Quarter 2003. Medical expenses were 0.2% higher, as a percentage of net
sales, than the Third Quarter 2003. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation and amortization amounted to $10.5 million, or 3.7% of net sales,
during the Third Quarter 2004, as compared to $10.2 million, or 4.6% of net
sales, during the Third Quarter 2003. The increase in depreciation and
amortization primarily was a result of increases to our store base. Depreciation
and amortization decreased, as a percentage of net sales, as a result of the
leveraging over a larger sales base. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our provision for income taxes were $11.8 million and $7.4 million during the
Third Quarter 2004 and the Third Quarter 2003, respectively. Our effective tax
rate was 40.1% during the Third Quarter 2004 and 39.0% during the Third Quarter
2003. Our tax rate increased during the Third Quarter 2004 based on our updated
analysis of the domestic and foreign components of our effective tax rate.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our net income in the Third Quarter 2004 increased to $17.7 million from $11.6
million during the Third Quarter 2003, due to the factors discussed above.
</FONT></P>

<P><FONT SIZE=3><B>Thirty-Nine Weeks Ended October 30, 2004 Compared to
Thirty-Nine Weeks Ended November 1, 2003</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net sales increased $132.0 million, or 23%, to $695.4 million during the
thirty-nine weeks ended October 30, 2004 from $563.4 million during the
thirty-nine weeks ended November 1, 2003. During the thirty-nine weeks ended
October 30, 2004, we opened 45 stores, including our first two stores in Puerto
Rico, and closed two stores. Comparable store sales increased 15% during the
thirty-nine weeks ended October 30, 2004, which increased our net sales by $79.3
million. During the thirty-nine weeks ended October 30, 2004, our comparable
store sales increase primarily was the result of a 13% increase in the number of
comparable store transactions and a 2% increase in our average dollar
transaction size. Comparable store sales increased 1% during the thirty-nine
weeks ended November 1, 2003. Net sales for the 45 stores opened during the
thirty-nine weeks ended October 30, 2004, as well as other stores that did not
qualify as comparable stores, contributed $52.7 million of the net sales
increase. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the thirty-nine weeks ended October 30, 2004, we achieved comparable
store sales increases across all of our geographical regions, departments and
store types. By geography, the West, Canada, Southwest and Rocky Mountain
regions were the strongest, while the Northeast region was weakest. Accessories
and boys were the best performing departments. Our mall stores were the best
performing store type, whereas street locations underperformed compared to
results for the overall chain. We are unable to predict if these geographical,
department and store type trends will continue in the future. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Gross profit increased by $52.4 million during the thirty-nine weeks ended
November 1, 2004 to $264.1 million from $211.7 million during the thirty-nine
weeks ended November 1, 2003. As a percentage of net sales, gross profit
increased to 38.0% during the thirty-nine weeks ended October 30, 2004 from
37.6% during the thirty-nine weeks ended November 1, 2003. The increase in gross
profit, as a percentage of net sales, was principally due to the leveraging of
occupancy costs over a larger sales base and lower markdowns, partially offset
by a lower initial markup. During the thirty-nine weeks ended October 30, 2004,
occupancy costs, as a percentage of net sales, decreased 2.3% as a result of our
comparable store sales increase and larger sales base. Markdowns were lower by
1.7%, as a percentage of net sales, during the thirty-nine weeks ended October
30, 2004 as compared to the thirty-nine weeks ended November 1, 2003 due to
continued positive customer response to our merchandise, combined with improved
techniques to allocate merchandise to our stores. Our initial markup was 3.3%
lower, as a percentage of net sales, during the thirty-nine weeks ended October
30, 2004 as compared to the thirty-nine weeks ended November 1, 2003. Our
initial markup was lower due to our continuing investment in garment quality and
a larger portion of our inventory invested in basic merchandise, which carries a
lower initial markup. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Selling, general and administrative expenses increased $31.4 million to $200.9
million during the thirty-nine weeks ended October 30, 2004 from $169.5 million
during the thirty-nine weeks ended November 1, 2003. Selling, general and
administrative expenses were 28.9% of net sales during the thirty-nine weeks
ended October 30, 2004 as compared with 30.1% of net sales during the
thirty-nine weeks ended November 1, 2003. As a percentage of net sales, selling,
general and administrative expenses decreased primarily due to lower store
payroll. Due to our strong comparable store sales performance during the
thirty-nine weeks ended October 30, 2004, our store payroll expenses were 0.9%
lower, as a percentage of net sales, than the thirty-nine weeks ended November
1, 2003. The remainder of our favorable selling, general and administrative
expenses, as a percentage of net sales, resulted from the leveraging of
marketing and store expenses, partially offset by higher medical expenses.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation and amortization amounted to $31.2 million, or 4.5% of net sales,
during the thirty-nine weeks ended October 30, 2004, as compared to $29.6
million, or 5.2% of net sales, during the thirty-nine weeks ended November 1,
2003. The increase in depreciation and amortization primarily was a result of a
larger store base. As a percentage of net sales, depreciation and amortization
decreased as a result of leveraging over a larger sales base. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our provision for income taxes were $12.9 million and $5.0 million for the
thirty-nine weeks ended October 30, 2004 and the thirty-nine weeks ended
November 1, 2003, respectively. Our tax rate was 40.0% during the thirty-nine
weeks ended October 30, 2004 as compared with 39.0% during the thirty-nine weeks
ended November 1, 2003. Our tax rate increased based on our updated analysis of
the domestic and foreign components of our effective tax rate. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Due to the factors discussed above, our net income increased to $19.3 million
during the thirty-nine weeks ended October 30, 2004 from $7.8 million during the
thirty-nine weeks ended November 1, 2003. </FONT></P>

<P><FONT SIZE=3><B>Liquidity and Capital Resources</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Acquisition of The Disney Store</B> </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On November 22, 2004 (effective as of November 21, 2004), we consummated the
acquisition of the "Disney Store" chain of retail stores in North America (the
"Acquisition"), pursuant to the terms of the Acquisition Agreement entered into
on October 19, 2004 (the "Acquisition Agreement"), between two of our
subsidiaries, as purchasers, and two subsidiaries of The Walt Disney Company, as
sellers. Pursuant to the terms of the Acquisition Agreement, our
subsidiaries acquired 100% of the outstanding equity interests in The Disney
Store, LLC ("TDS USA") and 100% of the outstanding shares of capital stock of
The Disney Store (Canada) Ltd. ("TDS Canada") from the sellers. As a result of
the Acquisition, a total of 313 Disney Stores, consisting of all existing Disney
Stores in the United States and Canada, other than "flagship" stores and stores
located at Disney theme parks and other Disney properties, along with certain
other assets used in the Disney Store business, became owned and operated by our
subsidiaries, and all store lease and other legal obligations of TDS USA and TDS
Canada became obligations of our subsidiaries. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In consideration for the transfer by the sellers to our subsidiaries of the
equity interests in TDS USA and TDS Canada, an estimated working capital payment
in the amount of $101.4 million became payable to the sellers in connection with
the consummation of the Acquisition. The amount of this working capital payment,
which is subject to adjustment, primarily reflected the level of inventory at
the Disney Stores for the 2004 holiday season as of November 21, 2004 as well as
a reduction in accounts payable prior to consummation of the Acquisition. Of
this amount, $45.4 million was paid by The Children's Place Retail Stores and
$40.0 million was paid by TDS USA, as permitted by the Acquisition Agreement, on
November 22, 2004. Payment of the remaining $16.0 million is due from The
Children's Place Retail Stores, but has been deferred (with interest) for up to
one month in accordance with the Acquisition Agreement.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pursuant to a Guaranty and Commitment entered into in connection with the
Acquisition (the "Guaranty and Commitment"), we invested $50 million into our
new subsidiary Hoop Retail Stores, LLC ("Hoop USA"), which merged with TDS USA
following the Acquisition, with Hoop USA surviving the merger. Hoop USA now
operates the business of the Disney Store in the United States and indirectly
owns the entire equity interest in the entity that operates the business of the
Disney Store in Canada. Under the terms of the Guaranty and Commitment, we are
obligated to invest up to an additional $50 million in Hoop USA, as necessary,
from time to time in the future to enable Hoop USA and its Canadian operating
subsidiary to comply with their obligations and operate the Disney Store
business. Pursuant to the Guaranty and Commitment, we also agreed to guarantee
the payment and performance by Hoop USA and its Canadian operating subsidiary
and certain of their affiliates of their royalty payment and other obligations
to TDS Franchising LLC, a subsidiary of The Walt Disney Company, under a License
and Conduct of Business Agreement that was entered into in connection with the
Acquisition (the "License Agreement"), subject to a maximum guaranty liability
of The Children's Place Retail Stores of $25 million. In addition, under the
License Agreement, until achievement of certain operating results, Hoop USA is
restricted from paying dividends to The Children's Place Retail Stores.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We funded our capital commitment for the Acquisition and our portion of the
working capital payment partially through cash on hand and partially through
short-term borrowings under our recently expanded credit facility under which
Wells Fargo Retail Finance, LLC ("Wells Fargo") serves as agent
(described below). TDS USA funded its $40 million portion of the working capital
payment, and the issuance of $23.0 million of standby letters of credit to the
sellers as required by the Acquisition Agreement (primarily for the purpose of
backing up the sellers' obligations for merchandise on order and freight
services), by drawing upon a newly established credit facility for The Disney
Store (also described below). </FONT></P>

<P><FONT SIZE=3><B>Debt Service/Liquidity</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to the Disney Store acquisition, our primary uses of cash were financing
new store openings and providing for working capital, which principally
represented the purchase of inventory. Our working capital needs follow a
seasonal pattern, peaking during the second and third quarters when inventory is
purchased for the back-to-school and holiday selling seasons. We have been able
to meet our cash needs principally by using cash on hand, cash flows from
operations and seasonal borrowings under our credit facilities. As of October
30, 2004, we had no long-term debt obligations or short-term borrowings. After
the Disney Store acquisition, however, we had borrowings under our credit
facilities for both The Children's Place and The Disney Stores.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of October 30, 2004, we amended and restated the credit facility we had with
Wells Fargo prior to October 30, 2004 (the "Original Wells Fargo Credit
Facility"). The Original Wells Fargo Credit Facility provided for
borrowings up to $85 million (including a sublimit for letters of credit of $80
million). The Original Wells Fargo Credit Facility also contained provisions to
allow us to increase borrowings up to $120 million (including a sublimit for
letters of credit of $100 million), subject to sufficient collateralization and
the syndication of the incremental line of borrowing. The amount that could be
borrowed under the Wells Fargo Credit Facility depended on our levels of
inventory and accounts receivable. Amounts outstanding under the facility bore
interest at a floating rate equal to the prime rate or, at our option, a LIBOR
rate plus a pre-determined spread. The LIBOR spread was 1.50% to 3.00%,
depending on our level of availability from time to time. The Wells Fargo Credit
Facility contained covenants, which included limitations on our annual capital
expenditures, maintenance of certain levels of excess collateral and a
prohibition on the payment of dividends. Credit extended under the Wells Fargo
Credit Facility was secured by a first priority security interest in all our
assets, except for our assets in Canada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of October 30, 2004, we amended and restated our credit facility with Wells
Fargo (the "Amended Loan Agreement"), partly in connection with our
acquisition of the Disney Store retail chain. The terms of the Amended Loan
Agreement are substantially the same as the Original Wells Fargo Credit Facility
except the Amended Loan Agreement provides for borrowings up to $130 million
(including a sublimit for letters of credit of $100 million) and extends the
term of the facility until November 1, 2007 with successive one-year renewal
options. In addition, the Amended Loan Agreement provides for a temporary
over-advance facility under which we will have the right to borrow up to $30
million through December 31, 2004, regardless of the amount of collateral. The
Amended Loan Agreement is secured by a first priority security interest in
substantially all of our assets, other than assets in Canada and assets owned by
our subsidiaries that were formed in connection with the acquisition of the
Disney Stores business in North America. Amounts outstanding under the Amended
Loan Agreement bear interest at a floating rate equal to the prime rate or, at
our option, a LIBOR rate plus a pre-determined spread. The LIBOR spread will be
1.50% to 3.00%, depending on our level of availability from time to time, except
that the LIBOR spread for over-advances will be 4%. We expect to use borrowings
under the Amended Loan Agreement for working capital purposes and to support the
acquisition of the Disney Stores. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of October 30, 2004, we had no borrowings under our Amended Loan Agreement
and had outstanding letters of credit of $55.1 million. Availability as of
October 30, 2004 under the Amended Loan Agreement was $74.9 million. The maximum
outstanding letters of credit during the thirty-nine weeks ended October 30,
2004 were $60.1 million. We were in compliance with all of the covenants under
the Amended Loan Agreement as of October 30, 2004. Noncompliance with these
covenants could result in additional fees, could affect our ability to borrow or
could require us to repay the outstanding balance. On November 22, 2004 we
borrowed approximately $53.8 million under the Amended Loan Agreement to satisfy
a portion of our payment obligations in connection with the acquisition of the
Disney Stores. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with our Acquisition of the Disney Stores, TDS USA and its
successor Hoop USA and the subsidiaries of Hoop USA, as guarantors, entered into
a Loan and Security Agreement (the "Hoop Loan Agreement") dated as of
November 21, 2004 with certain financial institutions and Wells Fargo, as
administrative agent, establishing a senior secured credit facility for the
Disney Store business. The Hoop Loan Agreement provides for borrowings and
letters of credit up to $100 million, subject to the amount of eligible
inventory and accounts receivable of Hoop USA from time to time. The term of the
facility extends until November 1, 2007. Amounts outstanding under the Hoop Loan
Agreement will bear interest at a floating rate equal to the prime rate plus a
pre-determined margin or, at Hoop USA's option, the LIBOR rate plus a
pre-determined margin. The prime rate margin will be 0.25% and the LIBOR margin
will be 2.0% or 2.25%, depending on Hoop USA's level of excess availability
from time to time. The Hoop Loan Agreement contains various covenants, including
limitations on indebtedness, maintenance of certain levels of excess collateral
and restrictions on the payment of dividends and payment of any indebtedness of
Hoop USA and Hoop Canada held by us. Credit extended under the Hoop Loan
Agreement is secured by a first priority security interest in substantially all
the assets of Hoop USA and Hoop Canada as well as a pledge of a portion of the
equity interests in Hoop Canada. Borrowings and letters of credit under the Hoop
Loan Agreement will be used by Hoop USA and its subsidiary Hoop Canada for
working capital purposes for the Disney Stores. In addition, a portion of the
borrowings under the Hoop Loan Agreement at the time of consummation of our
Acquisition of the Disney Stores were used to satisfy a portion of our payment
obligations owed to the Sellers. On November 22, 2004, Hoop USA borrowed $40.3
million under the Hoop Loan Agreement, and $23.0 million of standby letters of
credit were issued under the Hoop Loan Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To support our Canadian operations, we have an $8.2 million credit facility with
Toronto Dominion Bank, which, as of October 30, 2004, was collateralized by a
standby letter of credit obtained under the Wells Fargo Credit Facility to
permit up to $1.8 million in borrowings. As of October 30, 2004, we had no
borrowings under our Canadian credit facility and had no outstanding letters of
credit. During the thirty-nine weeks ended October 30, 2004, we did not utilize
our Canadian credit facility. </FONT></P>

<P><FONT SIZE=3><B>Cash Flows/Capital Expenditures</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the thirty-nine weeks ended October 30, 2004, operating activities
provided $4.0 million in cash flow as compared to $32.3 million provided by
operating activities during the thirty-nine weeks ended November 1, 2003.
Despite higher earnings during the thirty-nine weeks ended October 30, 2004,
operating activities generated less cash primarily as a result of increased
inventory levels and higher tax payments due to our increased profitability.
During the thirty-nine weeks ended October 30, 2004, we strategically
accelerated the receipt of our merchandise and correspondingly increased our
inventory levels. We believe this strategy has provided us with greater
flexibility in reacting to sales trends, enabled us to better manage product
flows to our stores and improved our floorset execution of new season
merchandise as evidenced by our comparable store sales increase of 15% during
the thirty-nine weeks ended October 30, 2004. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Cash flows used in investing activities were $37.2 million and $25.6 million in
the thirty-nine weeks ended October 30, 2004 and the thirty-nine weeks ended
November 1, 2003, respectively. During the thirty-nine weeks ended October 30,
2004 and the thirty-nine weeks ended November 1, 2003, we opened 45 stores and
49 stores and remodeled six stores and 11 stores, respectively. In anticipation
of the Disney Store acquisition, we have made certain capital investments to
support our growing businesses. The increase in cash flows used in investing
activities reflects increased expenditures for distribution center and
information systems initiatives, partially offset by lower new store
expenditures reflecting fewer store openings and remodels during the thirty-nine
weeks ended October 30, 2004. Capital expenditures also include ongoing store,
office and distribution center equipment needs. We anticipate that total capital
expenditures for our Children's Place and Disney Store businesses during
fiscal 2004 will be approximately $50 million. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As noted previously, we acquired the business of the Disney Stores in the United
States and Canada as of November 21, 2004. Accordingly, our future reported
results will include the Disney Stores. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In July 2004, we entered into an 11 year lease, with two five-year renewal
option periods, for an approximately 525,000 square foot distribution center in
South Brunswick Township, New Jersey to support our continued growth. Annual
rent under this lease is approximately $2.3 million. We plan to utilize this
facility beginning in the second quarter of fiscal 2005. We anticipate it will
cost approximately $15 million to install an automated warehouse management
system and to renovate this distribution center to meet our needs. In fiscal
2004, we expect to make a cash outlay of approximately $3 million (which is
included in our fiscal 2004 capital plans), for this facility. During fiscal
2005, we may enter into lease agreements, to defray a portion of the cash outlay
needed for this facility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Cash flows provided by financing activities were $2.7 million and $0.8 million
during the thirty-nine weeks ended October 30, 2004 and thirty-nine weeks ended
November 1, 2003, respectively. During the thirty-nine weeks ended October 30,
2004 and the thirty-nine weeks ended November 1, 2003, cash flows provided by
financing activities primarily reflected funds received from the exercise of
employee stock options and employee stock purchases. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We plan to end fiscal 2004 with 750 Children's Place stores and 308 Disney
stores. As of December 8, 2004, we operate 750 Children's Place stores and
313 Disney Stores. During the remainder of fiscal 2004, for The Children's
Place business, we plan to open one additional store and close one store. During
the thirty-nine weeks ended October 30, 2004, we opened 45 stores and closed two
stores. For the Disney Store business, we plan to close 7 stores by the end of
fiscal 2004. We believe that cash generated from operations and funds available
under our credit facilities will be sufficient to fund our capital and other
cash flow requirements for at least the next 12 months. Our ability to meet our
capital requirements will depend on our ability to generate cash from
operations. In addition, we will consider additional sources of financing to
fund our long-term growth. </FONT></P>

<P><FONT SIZE=3><B>Item 3. Quantitative and Qualitative Disclosures about Market
Risks.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the normal course of business, the Company's financial position and
results of operations are routinely subject to market risk associated with
interest rate movements on borrowings and investments and currency rate
movements on non-U.S. dollar denominated assets, liabilities and income. The
Company utilizes cash from operations and short-term borrowings to fund its
working capital and investment needs. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Cash balances are normally invested in short-term financial instruments. Because
of the short-term nature of these investments, changes in interest rates would
not materially affect the fair value of these financial instruments. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company's credit facilities with Wells Fargo provide a source of
financing for its working capital requirements. Borrowings under the facilities
bear interest at a floating rate equal to the prime rate or, at the
Company's option, a LIBOR rate plus a pre-determined spread. As of October
30, 2004, the Company had no borrowings outstanding under its credit facilities.
In November 2004, the Company used its credit facilities with Wells Fargo to
fund its acquisition of the Disney Stores. The Company borrowed $53.8 million
under its Amended Loan Agreement and $40.3 million under its Hoop Loan
Agreement. In addition, $23.0 million of standby letters of credit were drawn on
the Hoop Loan Agreement, primarily for the purpose of backing up obligations for
Disney Store merchandise on order and freight services. The Company expects to
utilize its credit facilities to support its working capital needs for its
expanded business in the future. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Assets and liabilities outside the United States are primarily located in
Canada. The Company's investment in foreign subsidiaries with a functional
currency other than the U.S. dollar, are generally considered long-term. The
Company has purchased forward contracts to reduce the exposure to variability in
currency fluctuations in its Canadian operations, which are not designated as
hedges for accounting purposes. </FONT></P>

<P><FONT SIZE=3><B>Item 4. Controls and Procedures.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) <U>Disclosure controls and procedures</U>. As of the end of the Company's
most recently completed fiscal quarter covered by this report, the Company
carried out an evaluation, with the participation of the Company's management,
including the Company's Chief Executive Officer and Chief Financial Officer, of
the effectiveness of the Company's disclosure controls and procedures pursuant
to Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the
"Securities Exchange Act"). Based upon that evaluation, the Company's Chief
Executive Officer and Chief Financial Officer concluded, as of the end of the
period covered by this report, that the Company's disclosure controls and
procedures are effective in ensuring that information required by the Securities
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission's rules and forms.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) <U>Changes in internal controls over financial reporting</U>. There have
been no changes in the Company's internal controls over financial reporting that
occurred during the Company's most recently completed fiscal quarter to which
this report relates that have materially affected, or are reasonably likely to
materially affect, the Company's internal control over financial reporting.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A control system, no matter how well conceived and operated, can provide only
reasonable, not absolute, assurance that the objectives of the control system
are met. Because of inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues, if any,
within a company have been detected. Accordingly, our disclosure controls and
procedures are designed to provide reasonable, not absolute, assurance that the
objectives of our disclosure control system are met.
</FONT></P>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>Part II - Other Information</B></FONT></P>

<P><FONT SIZE=3><B>Item 1. Legal Proceedings.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is involved in various legal proceedings arising in the normal
course of its business. In the opinion of management, any ultimate liability
arising out of such proceedings will not have a material adverse effect on the
Company's financial position or results of operations. </FONT></P>

<P><FONT SIZE=3><B>Item 6. Exhibits and Reports on Form 8-K.</B></FONT></P>

<P><FONT SIZE=3><B>(a) Exhibits</B></FONT></P>

<PRE><FONT SIZE=1>
      Exhibit
         No.                            Description of Document
      -------            -----------------------------------------------------------------------------------------

        2.1*             Acquisition Agreement dated as of October 19, 2004 by and among Disney Enterprises, Inc.,
                         Disney Credit Card Services, Inc., Hoop Holdings, LLC and Hoop Canada Holdings, Inc.

       10.3              Fourth Amended and Restated Loan and Security Agreement dated as of October 30,
                         2004 by and among The Children's Place Retail Stores, Inc. and each of its subsidiaries
                         that are signatories thereto, as borrowers, the financial institutions named therein, and
                         Wells Fargo Retail Finance, LLC, as agent.

       10.4*             License and Conduct of Business Agreement dated as of November 21, 2004 by and
                         among TDS Franchising, LLC, The Disney Store, LLC and The Disney Store (Canada)
                         Ltd.

       10.5              Guaranty and Commitment dated as of November 21, 2004 by The Children's Place
                         Retail Stores, Inc. and Hoop Holdings, LLC in favor of The Disney Store, LLC, The
                         Disney Store (Canada) Ltd. and TDS Franchising, LLC.

       10.6              Loan and Security Agreement dated as of November 21, 2004 between The Disney Store,
                         LLC and Hoop Retail Stores, LLC, as borrowers, Hoop Canada Holdings, Inc., as
                         guarantor, Hoop Canada, Inc. and The Disney Store (Canada) Ltd., as secondary
                         guarantors, the financial institutions named therein, and Wells Fargo Retail Finance, LLC,
                         as agent.

        31               Section 302 Certifications

        32               Section 906 Certifications
</FONT></PRE>

<P><FONT SIZE=3>_______________<BR>
* Confidential treatment requested as to certain portions, which portions are
omitted and filed separately with the Securities and Exchange Commission.
</FONT></P>


<P><FONT SIZE=3><B>(b) Reports on Form 8-K.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;July 2004 Sales Press Release, dated August 5, 2004.<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Second Quarter 2004 Earnings Press Release, dated August 12, 2004.<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Entry into a Material Definitive Agreement with The Walt Disney Company, dated October 19, 2004.</FONT></P>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>SIGNATURES</B></FONT></P>

<P><FONT SIZE=3>Pursuant to the requirements 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. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>&nbsp;</TD>
<TD WIDTH=50%>
THE CHILDREN'S PLACE<BR>
RETAIL STORES, INC.
</TD>
</TR>
</TABLE>
<BR>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>Date: December 9, 2004</TD>
<TD WIDTH=50%>
By: <U>/s/ Ezra Dabah
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chairman of the Board and<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Executive Officer<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Principal Executive Officer)
</TD>
</TR>
</TABLE>
<BR>
<BR>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>Date: December 9, 2004</TD>
<TD WIDTH=50%>
By: <U>/s/ Seth L. Udasin
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vice President and<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Financial Officer<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Principal Financial Officer)
</TD>
</TR>
</TABLE>
<BR>

</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2
<SEQUENCE>2
<FILENAME>childrens-ex21_120904.htm
<DESCRIPTION>EX-2.1
<TEXT>
<HTML>
<HEAD>
<TITLE>Ex-2.1</TITLE>
</HEAD>
<BODY>


<P ALIGN=CENTER><FONT SIZE=3><B>ACQUISITION AGREEMENT</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>dated as of</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>October 19, 2004</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>by and among</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>Disney Enterprises, Inc.,</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>Disney Credit Card Services, Inc.,</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>Hoop Holdings, LLC</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>and</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>Hoop Canada Holdings, Inc.</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>ACQUISITION AGREEMENT</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
<B>ACQUISITION AGREEMENT</B> (this <B>"Agreement"</B>) is entered into
as of October 19, 2004, by and among DISNEY ENTERPRISES, INC., a Delaware
corporation (<B>"DEI"</B>), DISNEY CREDIT CARD SERVICES, INC., a
California corporation wholly-owned by DEI (<B>"Seller"</B>), HOOP
HOLDINGS, LLC, a Delaware limited liability company (<B>"USA
Purchaser"</B>), and HOOP CANADA HOLDINGS, INC., a Delaware corporation
(<B>"Canadian Purchaser"</B> and, together with USA Purchaser,
collectively, <B>"Buyer"</B>) (DEI and Seller, taken together as one
party, and Buyer are sometimes referred to each as a <B>"party"
</B>and collectively as the <B>"parties"</B>). </FONT></P>

<P ALIGN=CENTER><U>W</U>&nbsp;<U>I</U>&nbsp;<U>T</U>&nbsp;<U>N</U>&nbsp;<U>E</U>
&nbsp;<U>S</U>&nbsp;<U>S</U>&nbsp;<U>E</U>&nbsp;<U>T</U>&nbsp;<U>H</U>:</P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS, Seller owns 100% of the issued and outstanding equity ownership
interest in The Disney Store, LLC, a California limited liability company
(<B>"TDS USA"</B>), and DEI owns 100% of the issued and outstanding
shares of capital stock of The Disney Store (Canada) Ltd., a corporation
incorporated under the laws of the Province of Ontario (<B>"TDS
Canada"</B> and, together with TDS USA, collectively, the
<B>"Company"</B>); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS, the Company is engaged in the operation of a chain of specialty retail
stores operated under the "Disney Store" name in the United States and
Canada; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS, Buyer desires to acquire substantially all of such chain of retail
stores by way of the acquisition (i) by USA Purchaser of&#160;all of the
outstanding units of membership interests in TDS USA (collectively, the
<B>"Membership Units"</B>) from Seller and (ii)&#160;by Canadian
Purchaser of all of the outstanding shares of capital stock of TDS Canada
(collectively, the <B>"Shares"</B>) from DEI, and DEI and Seller wish
to transfer substantially all of such chain of retail stores by way of the
transfer of the Membership Units to USA Purchaser and the Shares to Canadian
Purchaser, all in accordance with the terms and subject to the conditions of
this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, in consideration of the representations, warranties, covenants and
agreements contained herein, the parties agree as follows: </FONT></P>

<P ALIGN=CENTER><B>ARTICLE I<BR>
DEFINITIONS</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Definitions</U>. As used in this Agreement,
the following defined terms shall have the respective meanings set forth
below:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Acceptable TDS Canada Section 116 Certificate" </B>has the meaning
specified in Section&#160;3.5.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Acquired Leases" </B>means any and all Contracts under which the
premises of the Acquired Stores (and related storage space, if any) are leased
to TDS USA or TDS Canada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Acquired Stores" </B>means the specialty retail stores leased
and/or operated by TDS USA or TDS Canada under the "<I>Disney
Store</I>" name on the date that is immediately prior to the Closing and
set forth on the Acquired Stores Schedule. For purposes of clarification, the
"Acquired Stores" shall exclude (i) Flagship Stores and (ii) Deferred
Stores, Non-Transferable Stores and Expired Lease Stores but only from and after
the effective date on which such Deferred Stores, Non-Transferable Stores and
Expired Lease Stores are removed from the Acquired Stores Schedule in accordance
with this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Acquired Stores Schedule"</B> means <U>TDS Schedule 1.1(a)</U>,
which sets forth the Acquired Stores (by store number, location/mall name and
state/province), their respective Lease Base Rent Amounts, Lease Percentage Rent
Amounts and Lease Sales Amounts, whether the Acquired Store is a Core Store or
Non-Core Store, whether the Consent of the Landlord under the related Acquired
Lease is required in connection with the transactions contemplated hereby and,
if a Consent Required Core Store, the Lease Liability thereof, as such schedule
may be amended after the date hereof pursuant to Section&#160;6.7.2 and/or
Section&#160;6.7.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Acquisition Agreement Guarantee"</B> means the "Guarantee by
TCP" attached hereto following the signature page hereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Action"</B> means any action, lawsuit, charge, complaint, claim
(including a letter authored by an attorney on behalf of his client alleging a
Loss), counterclaim, arbitration, order, decree, judgment, investigation or any
legal, administrative or Tax proceeding, whether civil or criminal, in law or in
equity, or before any arbitrator or Governmental Entity. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Adjustment Statement"</B> has the meaning specified in
Section&#160;2.3.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Adjustment Statement Objection"</B> has the meaning specified in
Section&#160;2.3.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Adjustment Threshold"</B> means Five Hundred Thousand Dollars
($500,000). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Affiliate"</B> means, with respect to any Person, any other
natural person or Entity that directly or indirectly, through one or more
intermediaries, controls, is controlled by or is under common control with such
Person. For the purposes of this definition, the term "control"
(including, with correlative meanings, the terms "controlling,"
"controlled by," and "under common control with") means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting Securities, by Contract, or otherwise; <U>provided</U>, that
(i)&#160;in no event shall Buyer or any of its Affiliates be deemed an Affiliate
of DEI or Seller or vice versa, and (ii) for purposes of this Agreement, in no
event shall any of the following entities or any of their respective Affiliates
be deemed an Affiliate of DEI or Seller: (A) Euro Disney Investments, Inc., EDL
S.N.C. Corporation, Euro Disney Associes S.N.C., Euro Disneyland SNC, Euro
Disney SCA, Euro Disneyland Participations S.A., Euro Disney S.A., EDL Holding
Company, EDL Participations S.A., Centre de Congres Newport S.A.S., Euro
Disneyland Imagineering S.a.r.l., Societe de Gerance d'Euro Disneyland SA
and any other entity commonly known as "Euro Disney", "Euro
Disneyland" or "Disneyland Resort Paris", and (B) Hongkong
International Theme Parks Limited, Hong Kong Disneyland Management Limited, and
Walt Disney Holdings (Hong Kong) Limited and any other entity commonly known as
"Hong Kong Disney", "Hong Kong Disneyland" or
"Disneyland Resort Hong Kong". </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Aggregate Lease Liability"</B> means the aggregate Lease Liability
for all of the Signing Date Acquired Stores that are Consent Required Core
Stores. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Agreement"</B> means this Agreement by and among the parties as
amended, restated or supplemented from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Ala Moana Store"</B> means the store located at the Ala Moana
Center in Hawaii. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Amex"</B> has the meaning specified in Section&#160;6.10.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Amex Agreement"</B> has the meaning specified in
Section&#160;6.10.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Appeal Notice"</B> has the meaning specified in
Section&#160;11.17.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Appellate Arbitrators"</B> has the meaning specified in
Section&#160;11.17.5(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Approved Deferred Leases"</B> has the meaning specified in
Section&#160;6.7.3(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Approved Deferred Store Inventory Amount"</B> means the amount of
Inventory equal to (i) the total number of Approved Deferred Stores as of the
Subsequent Closing Date <U>multiplied by</U> (ii) the Per Store Inventory
Allocation; <U>provided</U>, that for purposes of the foregoing subparagraph
(i), if applicable, the Ala Moana Store and the Caesar's Palace Store shall
each be treated as two (2) Stores (such that the Approved Deferred Store
Inventory Amount with respect to each such Store shall be equal to twice the Per
Store Inventory Allocation). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Approved Deferred Store Ordered Inventory Amount"</B> means the
amount of Ordered Inventory equal to (i) the total number of Approved Deferred
Stores as of the Subsequent Closing Date <U>multiplied by</U> (ii) the Per Store
Ordered Inventory Allocation; <U>provided</U>, that for purposes of the
foregoing subparagraph (i), if applicable, the Ala Moana Store and the
Caesar's Palace Store shall each be treated as two (2) Stores (such that
the Approved Deferred Store Ordered Inventory Amount with respect to each such
Store shall be equal to twice the Per Store Ordered Inventory Allocation).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Approved Deferred Stores"</B> means the Stores the premises of
which are leased under the Approved Deferred Leases. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Approved Deferred Stores Schedule"</B> means the schedule
identifying the Approved Deferred Stores (by store number, location/mall name
and state/province). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Arbitrable Disputes"</B> has the meaning specified in
Section&#160;11.17.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Arbitration Administrator"</B> has the meaning specified in
Section&#160;11.17.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Arbitration Parties"</B> has the meaning specified in
Section&#160;11.17.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Arbitrator"</B> has the meaning specified in
Section&#160;11.17.5(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Average Per Store Working Capital Value"</B> means Thirty-Eight
Thousand Four Hundred Seventy-One Dollars ($38,471). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Balance Sheet Date"</B> means June 26, 2004.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Banking Institution"</B> means (i) any national bank or banking
institution or trust company organized under the Laws of the United States or
any state or territory of the United States or the District of Columbia, the
business of which is substantially confined to banking and is supervised by the
applicable federal, state or territorial banking commission or similar official;
(ii) a savings and loan association, building and loan association, cooperative
bank, homestead association or similar institution that is supervised and
examined by state or federal authority having supervision over any such
institution; or (iii) a company that is organized as an insurance company and
whose primary and predominant business activity is the writing of insurance or
the reinsuring of risks underwritten by insurance companies and that is subject
to supervision by the insurance commission or a similar official or agency of a
state or territory or the District of Columbia; <U>provided</U>, that, for
purposes of this Agreement, any Banking Institution that is owned, leased,
licensed, controlled or operated by a Person who would be a Disqualified Person
but for subparagraph (7) of the definition of "Disqualified Person"
shall be excluded from the definition of "Banking Institution."
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Bank of Montreal Account"</B> has the meaning specified in Section
6.11.1(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Basket"</B> has the meaning specified in Section&#160;10.4.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Business"</B> means, collectively, all properties and assets used
by, all liabilities and obligations incurred by, and all operations and conduct
of, the Company in connection with (i)&#160;operating the Acquired Stores
(including the Deferred Stores), (ii)&#160;developing, manufacturing or causing
the manufacture of, offering for sale and selling merchandise within the
Acquired Stores (including the Deferred Stores), (iii)&#160;warehousing and
distributing such merchandise to and among the Acquired Stores (including the
Deferred Stores), (iv)&#160;corporate administration of the foregoing
activities, and (v)&#160;other comparable activities related to the Acquired
Stores (including the Deferred Stores). For purposes of clarification, the
"Business" (a) does not include any conduct or operations related to
or in connection with the Disney Retained Stores or any other Retained Assets or
Retained Liabilities but rather consists solely of the conduct and operation of
the business pertaining to the Acquired Stores (including the Deferred Stores)
intended to be Transferred to Buyer pursuant to the Membership Unit Acquisition
and the Share Acquisition and (b)&#160;does not include any Intellectual
Property of DEI or its Affiliates, with respect to which any rights granted to
Buyer, the Company and/or their Affiliates following the Closing shall be
governed solely by the License and Conduct of Business Agreement and,
notwithstanding anything to the contrary contained herein, which shall not be,
and shall not be deemed to be, Transferred in any manner whatsoever pursuant to
this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Business Day"</B> means any day except Saturday, Sunday or any day
on which banks in the State of California are permitted to be closed.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer"</B> has the meaning specified in the preamble to this
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer Affiliate Securities"</B> means Securities of any Subsidiary
of USA Purchaser, including Canadian Purchaser and, from and after the Closing,
the Company and any Subsidiary of the Company, in each case, in whatever form.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer Designated Manufacturer"</B> has the meaning specified in
Section 6.2.3(c)(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer Disqualifying Event"</B> means (i)&#160;a negligent act or
omission or willful misconduct of a Person otherwise required to be indemnified
under Section&#160;10.2.1 (<U>provided</U>, <U>that</U>, for purposes of
clarification, Buyer's conduct of, or failure to conduct, due diligence
shall not, as applicable, constitute a negligent act or omission), (ii)&#160;any
reorganization or change in ownership of Buyer or any of its Affiliates,
(iii)&#160;any change by Buyer or any of its Affiliates in the accounting basis
on which its assets are valued or the accounting basis, method, policy or
practice on which its financial statements are prepared, or (iv) any change in
GAAP after the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer Excess Working Capital Portion"</B> means the portion of the
Estimated Closing Working Capital Adjustment Amount to be paid to Seller
pursuant to Section 3.3.1 that is in excess of Fifty Million Dollars
($50,000,000), if applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer Initial Working Capital Portion"</B> means the first Ten
Million Dollar ($10,000,000) portion of the Estimated Closing Working Capital
Adjustment Amount to be paid to Seller pursuant to Section 3.3.1, if applicable.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer Schedules"</B> means those certain disclosure schedules that
have been separately delivered by Buyer to DEI and Seller concurrently with the
execution of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer's Closing Capitalization Table"</B> has the meaning
specified in Section&#160;6.4.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer's Estimated Closing Balance Sheet"</B> has the meaning
specified in Section&#160;2.3.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer's Estimated Subsequent Closing Balance Sheet"</B> has
the meaning specified in Section&#160;2.3.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer's Governing Documents"</B> has the meaning specified in
Section&#160;5.1.6. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer's Liquidity Plan"</B> has the meaning specified in
Section&#160;6.4.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer Ordered Inventory"</B> means the amount of Ordered Inventory
equal to (i) the total number of Acquired Stores set forth on the Closing
Acquired Stores Schedule <U>multiplied by</U> (ii) the Per Store Ordered
Inventory Allocation; <U>provided</U>, <U>that</U>, for purposes of the
foregoing subparagraph (i), if applicable, the Ala Moana Store and the
Caesar's Palace Store shall each be treated as two (2) Stores (such that
the Buyer Ordered Inventory with respect to each such Store shall be equal to
twice the Per Store Ordered Inventory Allocation). Notwithstanding the
foregoing, "Buyer Ordered Inventory" shall exclude any such inventory
with respect to which a Supporting LC has been issued as of the Closing pursuant
to and in accordance with Section 6.11.6 in an amount sufficient to support
payment of the entire liability under the issued but undrawn letter of credit
under the Trade LC Facility that relates to or covers the inventory that would
otherwise be classified as Buyer Ordered Inventory. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Buyer Working Capital Amount"</B> means the Buyer Initial Working
Capital Portion <U>plus</U> the Buyer Excess Working Capital Portion, as
applicable; <U>provided</U>, <U>that</U>, in the event that USA Purchaser does
not make the election provided for in subparagraph (B) of the proviso of Section
3.3.1, and no portion of the Estimated Closing Working Capital Adjustment Amount
is paid by the Company, as a Subsidiary of Buyer, then the "Buyer Working
Capital Amount" shall be equal to the Estimated Closing Working Capital
Adjustment Amount. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"BVHE Merchandise"</B> means DVDs, home videos and other home
entertainment products acquired by the Company from Buena Vista Home
Entertainment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Caesar's Palace Store"</B> means the Store located at The
Forum Shops at Caesar's Palace in Las Vegas, Nevada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Canada Mastercard Agreement"</B> means the Mastercard Major
Merchant Agreement dated October 1, 1998, between Canadian Transferee and Bank
of Montreal, and related Bank of Montreal Operation of Business Account Terms
and Conditions, to which various Canadian Affiliates of DEI are parties
(including TDS Canada). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Canada Reincorporation"</B> has the meaning specified in Section
2.6.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Canada Reincorporation Date"</B> has the meaning specified in
Section 2.6.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Canadian Purchaser"</B> has the meaning specified in the preamble
to this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Canadian Purchaser Securities"</B> means the Securities of
Canadian Purchaser in whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Canadian Transfer"</B> has the meaning specified in
Section&#160;2.1.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Canadian Transferee"</B> means The Walt Disney Company (Canada)
Ltd., a corporation incorporated under the laws of the Province of Ontario.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"CCRA"</B> has the meaning specified in Section&#160;3.5.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"CCRA Letter"</B> has the meaning specified in Section&#160;3.5.3.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Closing"</B> has the meaning specified in Section&#160;3.1.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Closing Acquired Stores Schedule"</B> means the final Acquired
Stores Schedule as of the Closing Date reflecting any amendments thereto made
pursuant to Section&#160;6.7.2 and/or Section&#160;6.7.3 after the date hereof.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Closing Balance Sheet"</B> has the meaning specified in
Section&#160;2.3.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Closing Date"</B> means the date of the Closing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Closing Disney Retained Stores Schedule"</B> means the final
Disney Retained Stores Schedule as of the Closing Date reflecting any amendments
thereto made pursuant to Section&#160;6.7.2 and/or Section&#160;6.7.3 after the
date hereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Closing Working Capital Baseline"</B> means (i)&#160;the Average
Per Store Working Capital Value, <U>multiplied by</U> (ii)&#160;the number of
Acquired Stores set forth on the Closing Acquired Stores Schedule;
<U>provided</U>, <U>that</U>, for purposes of the foregoing subparagraph (ii),
if applicable, the Ala Moana Store and the Caesar's Palace Store shall each
be treated as two (2) Stores (such that the Closing Working Capital Baseline
with respect to each such Store shall be equal to twice the Average Per Store
Working Capital Value). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"COBRA"</B> means the benefit continuation provisions of Section
4980B of the Code and Section 601 et. seq. of ERISA and the related regulations
and published interpretations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Code"</B> means the Internal Revenue Code of 1986, as amended.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Combined Actual Financial Statements"</B> has the meaning
specified in Section&#160;4.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Combined Working Capital Adjustment Amount"</B> means the positive
or negative amount equal to (i)&#160;the Final Closing Working Capital
Adjustment Amount <U>plus</U> (ii)&#160;the Final Subsequent Closing Working
Capital Adjustment Amount. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company"</B> has the meaning specified in the recitals to this
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company Assets Schedule"</B> means <U>Buyer Schedule 1.1</U>,
which sets forth certain assets that will be retained by the Company as of the
Closing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company Credit Facility"</B> means a credit facility of and for
the Company, established by Buyer (at its sole cost and expense) on behalf of
the Company (as a Subsidiary of Buyer) pursuant to and in accordance with
Section&#160;6.11.6, that complies in all respects with the terms and provisions
of this Agreement and the License and Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company Information Technology"</B> means the Information
Technology set forth on <U>TDS Schedule&#160;4.7.2</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company License Agreement Restriction Agreement"</B> means any
Contract (i) prior to the Closing, to which TDS USA or TDS Canada is a party or
(ii) from and after the Closing, to which TDS USA or TDS Canada is a party or
would otherwise be bound, in the case of each of subparagraph (i) and (ii) that
would materially impair and restrict TDS USA's or TDS Canada's rights
under the License and Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company Minute Books"</B> has the meaning specified in Section
4.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company Plans"</B> means Employee Benefit Plans in which Employees
participate but in which employees of DEI and its ERISA Affiliates other than
the Company do not participate. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company Remodel Plans"</B> means the plans and designs pursuant to
which the Company currently anticipates undertaking Store renovations or
remodels, copies of which plans and designs have been made available to Buyer
prior to execution of this Agreement (as such plans and designs may be
subsequently modified with the approval of DEI and Buyer in their respective
sole discretion). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Company's Governing Documents"</B> has the meaning specified
in Section 4.1.3(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Competing Offer"</B> means any written inquiry, proposal or offer
from any Person relating to (i)&#160;any direct or indirect acquisition or
purchase of (A)&#160;all or substantially all of the assets of the Company used
in the Business, or (B)&#160;any Securities of the Company (other than the
transactions contemplated by this Agreement and, for purposes of clarification,
other than Securities of any Subsidiary of the Company that does not conduct any
portion of the Business) or (ii)&#160;any merger, consolidation, business
combination, recapitalization, liquidation, dissolution or similar transaction
involving the Company. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Competition Act"</B> means the Competition Act (Canada), as
amended, and the related regulations and published interpretations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Complaint"</B> has the meaning specified in Section&#160;11.17.4.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Confidential Information"</B> has the meaning specified in
Section&#160;11.9. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Confidentiality Agreement"</B> means that certain Confidentiality
Agreement dated as of August&#160;18, 2003 between TWDC and TCP. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Consent"</B> means any approval, consent, waiver or comparable
form of authorization that is required to be obtained from any Person, other
than any Governmental Entity, with respect to any Contract of TDS USA or TDS
Canada (including, without limitation, the Acquired Leases). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Consent Fee"</B> means any fee, charge or other payment
(including, without limitation, payment or reimbursement of costs and expenses
(including fees and expenses of attorneys and other professionals)) required by
any third party in connection with or as a condition to such third party's
grant of any Consent that is required with respect to any Acquired Lease in
connection with the transactions contemplated by this Agreement (as indicated on
the Acquired Stores Schedule). For purposes of clarification, "Consent
Fee" shall not include any additional rent, capital expenditures or other
monetary obligations imposed or increased pursuant to the terms of any Lease
(including, without limitation, any New Lease or any Acquired Lease or any
renewal, extension, amendment or modification thereof) in connection with
obtaining any required Consent under such Lease. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Consent Required Core Stores"</B> means, collectively, the Core
Stores as to which Consent is required with respect to the applicable Acquired
Leases in connection with the transactions contemplated by this Agreement (as
indicated on the Acquired Stores Schedule). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Continuing Employees"</B> means (i) all of the Employees listed on
<U>TDS Schedule 7.4.1</U> and (ii) all of the Employees not located at the
Corporate Headquarters, in the case of subparagraph (i), as <U>TDS Schedule
7.4.1</U> may be amended after the date hereof in accordance with Sections 6.3
and 7.4.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Continuing Employee Expenses"</B> means salary, bonuses, retention
payments and other amounts (including, without limitation, accrued vacation and
expense reimbursement) payable to Continuing Employees by the Company or its
Affiliates in respect of their employment with the Company for periods ending
prior to the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Contract"</B> means any agreement, lease, license, evidence of
debt, mortgage, hypothec, charge, deed of trust, note, bond, indenture, security
agreement, commitment, instrument, understanding, or other contract, obligation
or arrangement of any kind, whether written or oral, including, without
limitation, all amendments, renewals, extensions or other modifications thereof.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Core Stores"</B> means the Stores designated as "Core
Stores" on the Acquired Stores Schedule or the Deferred Stores Schedule, as
applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Corporate Headquarters"</B> means the Company's office
facilities located at 101 North Brand Boulevard, Glendale, California, which are
leased pursuant to the Corporate Headquarters Lease. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Corporate Headquarters Lease"</B> means that certain Glendale City
Center Office Building Lease dated as of June&#160;21, 1991 by and between OTR,
an Ohio general partnership, as nominee of The State Teachers Retirement Board
of Ohio, and TDS USA, as amended. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"CPA Firm"</B> has the meaning specified in Section&#160;2.3.2(b).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Current Assets"</B> means, with respect to any Person or Persons,
all assets of such Person or Persons that in accordance with Modified GAAP are
properly classified as current assets of the types identified in the balance
sheet account descriptions set forth in the Trial Balance (and, for purposes of
clarification, "Current Assets" shall exclude any current assets of a type that
are not identified in the balance sheet account descriptions set forth in the
Trial Balance); <U>provided</U>, that (A) the following items shall be included
within the definition of Current Assets (without duplication to the extent
already so included) whether or not such items would properly be classified as
"Current Assets" in accordance with the first clause of this definition of
"Current Assets": (i) Operating Expenses and Continuing Employee Expenses that
have been prepaid (other than a prepayment in violation of Section 6.3) as of
the date as of which Current Assets are being determined (<U>i.e.</U>, such
Person or Persons have paid the applicable Operating Expenses and/or Continuing
Employee Expenses with respect to a period commencing after the date as of which
Current Assets are being determined or in consideration of services that have
not been performed as of the date as of which Current Assets are being
determined); (ii) Buyer Ordered Inventory, <U>provided</U>, <U>that</U>, if as
of the date of determination of the post-Closing adjustment pursuant to Section
2.3.2, any letter of credit issued under a Trade LC Facility in connection with,
or as a payment mechanism for, Buyer Ordered Inventory has been cancelled or has
expired without being drawn, then the Buyer Ordered Inventory relating to or
covered by such letter of credit shall be deducted from the definition of
Current Assets to the extent that it was previously included pursuant to this
subparagraph&#160;(ii) (or, if not previously included in the definition of
Current Assets pursuant to this subparagraph&#160;(ii), shall not be so
included); (iii) Disney Umbrella Freight Services Amounts (for the avoidance of
doubt, the Disney Umbrella Freight Services Amounts, including such amounts in
respect of Disney Umbrella Freight Services to be provided after the Closing
pursuant to Section 6.11.3, shall be estimated for purposes of calculating the
Closing Date adjustment pursuant to Section 2.3.1 and shall be subject to a
true-up in connection with the calculation of the post-Closing adjustment
pursuant to Section 2.3.2); and (iv) the Approved Deferred Store Inventory
Amount and the Approved Deferred Store Ordered Inventory Amount (solely for
purposes of calculating the Store-Related Assets and Liabilities as of the
Subsequent Closing Date); and (B) the following items shall be excluded from the
definition of Current Assets whether or not such items would properly be
classified as "Current Assets" in accordance with the first clause of this
definition of "Current Assets": (i) the DCCS Allocated Inventory and DCCS
Allocated Ordered Inventory, (ii) any inventory located in or on the premises
of, or in transit to or allocated to, the Flagship Stores, which inventory shall
constitute a Retained Asset and which inventory the parties acknowledge is not
located in or on the premises of, and is not in transit to, the Distribution
Center or any other property of the Business, and (iii) any right to a Tax
refund that the Company and/or Buyer (as applicable) would be required to pay to
DEI or its Affiliates pursuant to Section 7.1.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Current Liabilities"</B> means, with respect to any Person or
Persons, all liabilities of such Person or Persons that in accordance with
Modified GAAP are properly classified as current liabilities of the types
identified in the balance sheet account descriptions set forth in the Trial
Balance (and, for purposes of clarification, "Current Liabilities"
shall exclude any current liabilities of a type that are not identified in the
balance sheet account descriptions set forth in the Trial Balance);
<U>provided</U>, that the following items shall be included within the
definition of Current Liabilities (without duplication to the extent already so
included) whether or not such items would properly be classified as
"Current Liabilities" in accordance with the first clause of this
definition of "Current Liabilities": (i) unpaid Operating Expenses and
unpaid Continuing Employee Expenses that have been accrued or that should have
been accrued (<U>e.g.</U>, in the case of Operating Expenses, after giving
effect to true-up assessments or credits or comparable adjustments by Landlords)
as of the date as of which Current Liabilities are being determined; and (ii)
amounts classified as "straight line rent" and "deferred rent
abatement" in accordance with the Company's past practice and
reflected on the balance sheet of the Company as of the date as of which Current
Liabilities are being determined. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"DCCS Allocated Inventory"</B> means, as of the Closing Date, the
amount of Inventory equal to (i) the total number of Deferred Stores and Disney
Retained Stores (excluding the Flagship Stores) <U>multiplied by</U> (ii) the
Per Store Inventory Allocation; <U>provided</U>, <U>that</U>, for purposes of
the foregoing subparagraph (i), the Michigan Avenue Store, the Post Street Store
and, if applicable, the Ala Moana Store and the Caesar's Palace Store,
shall each be treated as two (2) Stores (such that the DCCS Allocated Inventory
with respect to each such Store shall be equal to twice the Per Store Inventory
Allocation). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"DCCS Allocated Ordered Inventory"</B> means, as of the Closing
Date, the amount of Ordered Inventory equal to (i) the total number of Deferred
Stores and Disney Retained Stores (excluding the Flagship Stores) <U>multiplied
by</U> (ii) the Per Store Ordered Inventory Allocation; <U>provided</U>,
<U>that</U>, for purposes of the foregoing subparagraph (i), the Michigan Avenue
Store, the Post Street Store and, if applicable, the Ala Moana Store and the
Caesar's Palace Store, shall each be treated as two (2) Stores (such that
the DCCS Allocated Ordered Inventory with respect to each such Store shall be
equal to twice the Per Store Ordered Inventory Allocation). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"DC Observer"</B> has the meaning specified in Section 6.11.8.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Deferred Item Amount"</B> means an amount equal to the estimate,
determined in good faith by DEI, of the aggregate book value of Disney Dollars,
Disney Theme Park Passports and BVHE Merchandise that will be owned by the
Company as of the Closing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Deferred Lease Assignment and Assumption Agreement"</B> means an
Assignment and Assumption Agreement by and between Seller and/or Canadian
Transferee, on the one hand, and TDS USA and/or TDS Canada, as applicable, on
the other hand, in substantially the form attached hereto as
<U>Annex&#160;A</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Deferred Leases"</B> has the meaning specified in
Section&#160;6.7.3(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Deferred Stores"</B> means the Stores the premises of which are
leased under the Deferred Leases. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Deferred Stores Schedule"</B> means the schedule, prepared as of
the Closing Date in accordance with Section 6.7.2 and/or Section 6.7.3,
identifying the Deferred Stores (by store number, location/mall name and
state/province), their respective Lease Base Rent Amounts, Lease Percentage Rent
Amounts and Lease Sales Amounts, and whether the Deferred Store is a Core Store
or Non-Core Store. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"DEI"</B> has the meaning specified in the preamble to this
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"DEI Related Provision"</B> means, with respect to all Contracts to
be entered into by Buyer or its Affiliates (including the Company, as a
Subsidiary of Buyer) or any other Person in connection with the Company Credit
Facility and/or the Wells Fargo Credit Facility, as applicable, all terms and
provisions of such Contracts that relate to or affect in any manner whatsoever
the remedies thereunder, the termination thereof or defaults and/or events of
default thereunder, or that, as determined by DEI and Seller in their respective
business judgment, relate to or affect in any manner this Agreement, the License
and Conduct of Business Agreement, any other Related Agreement, the TCP Guaranty
and Commitment, the rights or obligations of the parties thereunder or the
Intellectual Property of DEI or its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Direct Claims"</B> has the meaning specified in Section&#160;10.4.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Branded Property"</B> has the meaning specified in the
License and Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Competitive Business"</B> means any business that competes,
in whole or in part, directly or indirectly, with (i) the motion picture
production, motion picture distribution, television and/or radio programming,
television and/or radio network, television and/or radio station, Theme Park,
cruise line, hotel, resort or animated character-based consumer products
business of DEI or its Affiliates, or (ii) any other media or entertainment
business or other material division or portion of the present or future business
of DEI or any of its Affiliates not covered by the preceding subparagraph (i);
<U>provided</U>, <U>that</U>, a Disney Competitive Business that competes only
with a business of DEI or its Affiliates identified in the preceding
subparagraph (ii) (and not in the preceding subparagraph (i)) shall not be
deemed to constitute a Disney Competitive Business hereunder if, during the most
recently completed fiscal year of such Disney Competitive Business, it generated
less than One Million Dollars ($1,000,000) of revenues from such competing
business. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Dollars"</B> means instruments commonly referred to and
known as of the date hereof as "Disney Dollars" that may be purchased
from DEI or its Affiliates and used as a method of payment comparable to cash to
purchase a variety of products and services at certain venues owned, leased,
licensed, controlled and/or operated by DEI or its Affiliates (including the
Acquired Stores), any modifications or replacements of the foregoing and any
comparable instruments created by DEI or its Affiliates after the date hereof.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Information Technology"</B> means all Information
Technology, other than Company Information Technology, that is currently owned,
licensed, controlled or used in any manner by TDS USA and/or TDS Canada, which
includes, without limitation: (i)&#160;Information Technology that is owned,
licensed or controlled by TDS USA or TDS Canada by, through, under or in
connection with master or global Information Technology Contracts under which
DEI or one of its Affiliates other than the Company is the primary licensee and
(ii)&#160;the Information Technology set forth on <U>TDS Schedule&#160;7.8</U>.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Issued Property"</B> has the meaning specified in Section
6.11.12. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Plans"</B> means Employee Benefit Plans that are sponsored
or maintained by DEI or any ERISA Affiliate or to which DEI or any ERISA
Affiliate (including the Company) is obligated to contribute, but excluding
Company Plans. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Property"</B> has the meaning specified in the License and
Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Retained Leases"</B> means any and all Contracts under
which the premises of the Disney Retained Stores (and related storage space, if
any) are leased. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Retained Stores"</B> means the specialty retail stores
held, leased and/or operated by TDS USA or TDS Canada under the "<I>Disney
Store</I>" name prior to the Closing and set forth on the Disney Retained
Stores Schedule. For purposes of clarification, the "Disney Retained
Stores" shall include (i) the Flagship Stores, (ii)&#160;Non-Transferable
Stores from and after the effective date on which such Non-Transferable Stores
are added to the Disney Retained Stores Schedule in accordance with this
Agreement and (iii)&#160;Deferred Stores that are not Approved Deferred Stores
from and after the Subsequent Closing Date or, if no Subsequent Closing occurs,
from and after the expiration of the Subsequent Closing Period. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Retained Stores Schedule"</B> means <U>TDS Schedule
1.1(b)</U>, which sets forth the Disney Retained Stores (by store number,
location/mall name and state/province), as such schedule may be amended after
the date hereof pursuant to Section&#160;6.7.2 and/or Section&#160;6.7.3.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Supply Chain Arrangements"</B> means all Contracts between
DEI or any of its Affiliates (other than TDS USA or TDS Canada), on the one
hand, and third party commercial freight carriers and commercial handlers of
freight, whereby the Company, participating as an Affiliate and/or Subsidiary of
DEI, obtains services relating to the transportation of merchandise of the
Company sourced from the Company's manufacturers or vendors, from such
manufacturers or vendors to the Distribution Center or the Stores. By way of
example, such arrangements shall include, without limitation, import
consolidation, ocean vessel/railway freight, parcel delivery, trucking
transportation and FedEx. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Theme Park Passports"</B> means general admission tickets
and passes and other admission media (i) for the entertainment, recreation and
lodging complex located in Anaheim, California, known as DISNEYLAND<SUP>&#174;
</SUP>Resort, one of the principal features of which is the operation of
two&#160;(2) separately gated theme and amusement parks known as
DISNEYLAND<SUP>&#174;</SUP> park and DISNEY'S CALIFORNIA ADVENTURE&#153;
theme park and (ii) for the entertainment, recreation and lodging complex
located in Orange County and Osceola County, Florida, known as the WALT DISNEY
WORLD&#174; Resort, one of the principal features of which is the operation of
four (4) separately gated theme and amusement parks known as MAGIC KINGDOM&#174;
Park, EPCOT&#174;, Disney-MGM Studios and DISNEY'S ANIMAL KINGDOM&#174;
Theme Park, provided that this subparagraph (ii) is limited solely to such
general admission tickets and passes and other admission media that are sold by
Stores located in Canada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Umbrella Freight Services"</B> means those freight services
provided to or used by the Company pursuant to any of the Disney Supply Chain
Arrangements, whether prior to the Closing or following the Closing in
accordance with Section 6.11.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Umbrella Freight Services Amounts"</B> means any amounts
incurred by DEI or its Affiliates (including the Company) in respect of Disney
Umbrella Freight Services provided to the Company on or prior to the Closing
Date that remain unpaid as of the Closing Date and any amounts to be incurred by
DEI or its Affiliates in respect of Disney Umbrella Freight Services to be
provided to the Company following the Closing Date pursuant to Section 6.11.3;
<U>provided</U>, <U>that</U>, Disney Umbrella Freight Services Amounts shall
exclude any such amounts in respect of which a Supporting LC has been issued as
of the Closing pursuant to and in accordance with Section 6.11.6. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disqualified Person"</B> means (i) any Person or group of Persons
who (by itself or through its Affiliates) owns, leases, licenses, operates or
otherwise engages in, in whole or in part, directly or indirectly, a Disney
Competitive Business; (ii) any Person or group of Persons who does not possess
the requisite experience or expertise in the business of retail sales of
consumer merchandise to enable such Person to operate the Acquired Stores and
the related online retail store in the manner contemplated and required by the
License and Conduct of Business Agreement; (iii) any Person or group of Persons
whose financial condition, results of operations, sources of liquidity and/or
prospects are insufficient or inadequate to enable such Person to operate the
Acquired Stores and the related online retail store in accordance with, and to
fulfill its other obligations under, the License and Conduct of Business
Agreement, the TCP Guaranty and Commitment and any other Contracts entered into
in connection therewith; or (iv) any Person or group of Persons (together with
its Affiliates) whose association with the Business, the Acquired Stores and the
related online retail store, Buyer, TCP, DEI, Seller or their respective
Affiliates, businesses, assets or properties as a result of the ownership of USA
Purchaser Securities, Buyer Affiliate Securities, TCP Securities or TCP
Affiliate Securities, or as a source or provider of liquidity under Buyer's
Liquidity Plan (a) may, as determined by DEI and Seller in their respective
business judgment, be expected to violate, constitute a default under or breach
in any material respect, or, even if not constituting an actual violation,
default or breach, may be expected to materially conflict with or impair the
rights, benefits or value accruing to Buyer, TCP, DEI, Seller or their
respective Affiliates under, any material Contract to which any of Buyer, TCP,
DEI, Seller or their respective Affiliates is a party or under which any of
their properties or assets are bound, or (b) may, as determined by DEI and
Seller in their respective sole discretion, be expected to be injurious to,
adversely impact or be inconsistent with, in any material respect, the image,
reputation, appearance or quality of, or may impair or adversely impact, in any
material respect, the goodwill associated with, Buyer, TCP, DEI, Seller or their
respective Affiliates or any Intellectual Property of DEI, Seller or their
respective Affiliates; <U>provided</U>, <U>that</U>: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a Person or group of Persons that, together
with its Affiliates taken as a whole, either (x) is engaged principally in the
business of retail sales of consumer merchandise and does not offer
character-based consumer merchandise in more than fifteen percent (15%) of the
aggregate retail merchandising space (in square feet) that is open to the public
(i.e., excluding stock rooms, restrooms and other non-public or non-retail
space) within any store or facility owned, leased, licensed, controlled or
operated by such Person or group of Persons or (y) engages in a Disney
Competitive Business in no manner whatsoever other than the ownership of no more
than five percent (5%) of the voting securities of a public company that is
engaged in a Disney Competitive Business, shall not be deemed to be engaged in a
Disney Competitive Business under the preceding subparagraph (i);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;with respect to the condition under the
preceding subparagraph (ii) pertaining to the possession of the requisite
experience or expertise in the business of retail sales of consumer merchandise,
(A) in the case of the ownership of TCP Securities or TCP Affiliate Securities,
the absence of such experience and expertise shall only make the owner of such
TCP Securities or TCP Affiliate Securities a Disqualified Person if such owner
is or becomes the Largest TCP Stockholder, the Second Largest TCP Stockholder,
the Largest TCP Affiliate Stockholder or the Second Largest TCP Affiliate
Stockholder, (B) a Person or group of Persons shall be deemed to have such
experience and expertise if the aggregate revenues of such Person or group of
Persons, together with its Affiliates taken as a whole, during its most recently
completed fiscal year prior to the date of determination hereunder, either (x)
were at least fifty percent (50%) comprised of retail sales of consumer
merchandise and included at least Five Hundred Million Dollars ($500,000,000) of
retail sales of consumer merchandise or (y) included at least One Billion
Dollars ($1,000,000,000) of retail sales of consumer merchandise, and (C) a
private equity fund that is engaged in the business of creating, maintaining and
managing a diversified portfolio of investments shall be deemed to have such
experience and expertise if, as of the date of determination hereunder, it had
at least fifty percent (50%) or more of its aggregate funds under management
invested in Persons or groups of Persons meeting the requirements contained in
either of the preceding subparagraphs (x) or (y) of the preceding subparagraph
(B);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the preceding subparagraph (iii) shall not
apply with respect to a Person (or group of Persons) owning TCP Securities or
TCP Affiliate Securities but not Buyer Securities or Buyer Affiliate Securities;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;for purposes of the preceding subparagraph
(iv)(a), a Contract shall be considered "material" if it is material in either a
quantitative manner (e.g., constituting more than two percent (2%) of a Person's
revenues or cash flows from operations) or a qualitative manner (e.g., impacting
more than one business unit or division of a Person, the subject of material
media or consumer attention, a source of brand prestige or favorable brand
association, a basis for attracting other business or alliances, a long-term or
long-standing arrangement, or other comparable qualitative factors);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(5)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;for purposes of the preceding subparagraph
(iv)(b), DEI and Seller acknowledge and agree that, in making their
determination in their respective sole discretion thereunder, they shall not use
the criteria set forth in such subparagraph as a subterfuge to disguise an
ulterior reason for determining that a Person is a "Disqualified Person," but
rather DEI and Seller shall base their determination thereunder solely on the
criteria set forth in such subparagraph to assess whether the Person is
appropriate for association with a family and children's entertainment brand
such as "Disney," which would exclude, by way of example and without limitation,
businesses that are associated with, relate to or promote tobacco, alcohol,
firearms, pornography, drugs, violence or crime (e.g., certain videogames) or
gambling;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(6)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;no Mutual Fund, Pension Fund or Eligible
Investment Fund shall be or be deemed to be a "Disqualified Person";</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(7)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a Banking Institution's ownership of debt
Securities (including, without limitation, notes, bonds, debentures or other
similar debt instruments) of TCP, Buyer or any of their respective Subsidiaries
and, following the Closing, the Company or any of its Subsidiaries, shall not be
considered in determining whether such Banking Institution is a "Disqualified
Person"; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(8)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;for purposes of this Agreement only, the
following Persons shall not be, and shall not be deemed to be, a "Disqualified
Person": (i) Wells Fargo, (ii) any Affiliates of Wells Fargo that are Banking
Institutions and (iii) any Banking Institutions that participate in a loan or
credit facility with Wells Fargo, or with any Affiliates of Wells Fargo that are
Banking Institutions, by or through syndication of such loan or credit facility
or any other customary and comparable arrangement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Distribution Center</B>" means the Company's distribution
center located in Memphis, Tennessee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"DLMI"</B> has the meaning specified in Section&#160;6.9.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Draft Post-Closing Merchandise Plan"</B> has the meaning specified
in Section 6.2.3(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"DTR License"</B> means a direct-to-retail license that authorizes
the retailer licensee thereunder to manufacture, or cause to be manufactured on
its behalf, consumer products for sale by such retailer licensee, bearing,
featuring or incorporating Disney Branded Properties, subject to the terms and
conditions of such license. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"DWS"</B> has the meaning specified in Section 6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"El Capitan Store"</B> means the Disney Retained Store located at
6838 Hollywood Boulevard, Los Angeles, California. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Eligible Investment Fund"</B> means any Person that is an
"investment company" within the meaning of the Investment Company Act
of 1940 and the rules and regulations promulgated thereunder, but only if and
for so long as such Person's investment in USA Purchaser Securities, Buyer
Affiliate Securities, TCP Securities or TCP Affiliate Securities is held solely
for investment purposes (as a passive investor) and not for the purpose, or with
the effect, of changing or influencing the control, management or policies of
Buyer, any Subsidiary of Buyer, TCP or such TCP Affiliate or as a participant in
any transaction having that purpose or effect; <U>provided</U>, that, for
purposes of this Agreement, any Eligible Investment Fund that is sponsored,
established, administered, issued, controlled, owned or operated by a Person who
would be a Disqualified Person but for subparagraph (6) of the definition of
"Disqualified Person" shall be excluded from the definition of
"Eligible Investment Fund." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Emergency Arbitrator"</B> has the meaning specified in Section
11.17.7. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Employee Benefit Plan"</B> means (i)&#160;any employee benefit
plan within the meaning of Section&#160;3(3) of ERISA, (ii)&#160;any similar
employment, consulting, severance agreement, contract, commitment, program or
other arrangement or policy (whether written or oral) providing for insurance
coverage (including self-insured arrangements), workers' compensation,
disability benefits, supplemental unemployment benefits, vacation benefits,
fringe benefits, retirement benefits, life, health or accident benefits
(including, without limitation, any "voluntary employees' beneficiary
association" as defined in Section 501(c)(9) of the Code providing for the
same or other benefits), or profit-sharing, deferred compensation, bonuses,
stock options, stock appreciation rights or other stock-based awards, or other
forms of incentive compensation or post-retirement insurance, compensation or
benefits, (iii) any Pension Fund, or (iv) any Multiemployer Plan. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Employee Indemnification Agreement</B>" means an agreement dated
August 27, 2004, between DEI and TCP pertaining to the issuance of letters by
TCP or its Affiliates to certain Employees pertaining to offers of continuing
employment of such Employees by the Company following the Closing and certain
indemnification obligations of TCP in connection therewith. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Employee Offer Letters</B>" means the letters issued by TCP or its
Affiliates to certain Employees pursuant to the Employee Indemnification
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Employees"</B> means all employees of the Company, including,
without limitation, those employed in connection with the operation of the
Business and those working in, assigned to or responsible for the oversight or
management of (<U>i.e.</U> a district or general manager) the Deferred Stores
and the Disney Retained Stores, other than those employees located in the
Flagship Stores and at the Distribution Center. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Employment Contracts" </B>means all material written employment,
consulting or independent contractor Contracts relating primarily to the
Business, including, without limitation, any written retention agreements
entered into in connection with the Business. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Encumbrance"</B> means any easement, encumbrance, lease, security
interest, lien, hypothec, charge, pledge, or comparable restriction, except for
any restrictions on transfer generally arising under any applicable federal,
state or provincial securities law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Entity"</B> means any corporation, partnership, limited
partnership, limited liability company, trust or other form of legal entity.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Environmental Requirements"</B> means all federal, state,
provincial and local government or agency Laws relating to pollution or
protection of human health and safety or the environment (including air, surface
water, ground water, land surface and subsurface strata), including Laws
relating to emissions, discharges, releases or threatened releases of Hazardous
Substances, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transportation or handling of Hazardous
Substances. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"ERISA"</B> means the Employee Retirement Income Security Act of
1974, as amended, and the related regulations and published interpretations.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"ERISA Affiliate"</B> means TDS USA, TDS Canada and all trades or
businesses (whether or not incorporated) that are members of a group of which
DEI, Seller, TDS USA or TDS Canada is a member and that are (i)&#160;a
"controlled group" within the meaning of Section&#160;414(b) of the
Code, (ii)&#160;a group "under common control" within the meaning of
Section&#160;414(c) of the Code, or (iii)&#160;an "affiliated service
group" within the meaning of Section&#160;414(m) or (o) of the Code.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Escrow Agent"</B> means Deutsche Bank or such other firm as DEI or
Seller shall select in its respective sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Estimated Closing Working Capital"</B> means the amount, estimated
in accordance with Section 2.3.1, equal to the sum of all Current Assets
reflected on the Closing Balance Sheet <U>minus</U> the sum of all Current
Liabilities reflected on the Closing Balance Sheet. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Estimated Closing Working Capital Adjustment Amount"</B> means the
positive or negative amount equal to (i)&#160;the Estimated Closing Working
Capital <U>minus</U> (ii)&#160;the Closing Working Capital Baseline. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Estimated Subsequent Closing Working Capital"</B> means the
amount, estimated in accordance with Section 6.7.3(c), equal to the sum of all
Current Assets reflected on the Subsequent Closing Balance Sheet <U>minus</U>
the sum of all Current Liabilities reflected on the Subsequent Closing Balance
Sheet. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Estimated Subsequent Closing Working Capital Adjustment
Amount"</B> means the positive or negative amount equal to (i) the
Estimated Subsequent Closing Working Capital <U>minus</U> (ii) the Subsequent
Closing Working Capital Baseline. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Excess Amount"</B> has the meaning specified in Section 3.1.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Exchange Act"</B> means the Securities Exchange Act of 1934, as
amended. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Existing DTR Licenses"</B> has the meaning specified in the
License and Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Existing Environmental Requirements"</B> means those applicable
provisions of any Environmental Requirements relating to the Business that are
both in effect and required to be met by the Company prior to the Closing Date.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Existing Restricted Name Agreements"</B> has the meaning specified
in the License and Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Expired Lease Stores"</B> has the meaning specified in
Section&#160;6.7.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Extension Date"</B> has the meaning specified in Section 7.4.4.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Allocation Schedule"</B> has the meaning specified in
Section 2.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Canada Purchase Price"</B> has the meaning specified in
Section&#160;2.3.2(d). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Closing Balance Sheet"</B> has the meaning specified in
Section 2.3.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Closing Working Capital"</B> means the sum of all Current
Assets reflected on the Final Closing Balance Sheet <U>minus</U> the sum of all
Current Liabilities reflected on the Final Closing Balance Sheet. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Closing Working Capital Adjustment Amount"</B> means the
positive or negative amount equal to (i)&#160;the Final Closing Working Capital
<U>minus</U> (ii)&#160;the Closing Working Capital Baseline. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Post-Closing Merchandise Plan"</B> has the meaning specified
in Section 6.2.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Subsequent Closing Balance Sheet"</B> has the meaning
specified in Section&#160;2.3.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Subsequent Closing Working Capital"</B> means the sum of all
Current Assets reflected on the Final Subsequent Closing Balance Sheet
<U>minus</U> the sum of all Current Liabilities reflected on the Final
Subsequent Closing Balance Sheet. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Subsequent Closing Working Capital Adjustment Amount"</B>
means the positive or negative amount equal to (i)&#160;the Final Subsequent
Closing Working Capital <U>minus</U> (ii)&#160;the Subsequent Closing Working
Capital Baseline. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final USA Purchase Price"</B> has the meaning specified in
Section&#160;2.3.2(d). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Final Working Capital Adjustment Amount"</B> has the meaning
specified in Section&#160;2.3.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Financial Statements"</B> has the meaning specified in
Section&#160;4.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Fiscal Year 2003"</B> means the twelve (12) months ended September
27, 2003. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Flagship Stores"</B> means the Disney Retained Stores located at
(a)&#160;711 Fifth Avenue, New York, New York, and (b)&#160;500 South Buena
Vista Street, Burbank, California (Disney Studio lot). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Freight Services Termination Date"</B> has the meaning specified
in Section 6.11.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Fundamental Representations"</B> means those representations and
warranties of (i) DEI and Seller contained in Sections 4.1, 4.4, 4.8.1 and 4.14
and (ii) Buyer contained in Sections 5.1, 5.2.1, 5.4, 5.5 and 5.6. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"GAAP"</B> means generally accepted accounting principles in the
United States, as in effect from time to time, consistently applied. Where more
than one alternative treatment is permitted by GAAP as of any date, GAAP shall
be deemed to refer, as of such date, to the treatment actually utilized by the
Company on a consistent basis prior to the Closing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Governmental Entity"</B> means any government or any agency,
bureau, board, commission, court, department, official, political subdivision,
tribunal or other instrumentality of any government, whether federal, state,
provincial or local, domestic or foreign. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Guarantor"</B> has the meaning specified in the Acquisition
Agreement Guarantee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Hart-Scott-Rodino Act"</B> means the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the related regulations and published
interpretations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Hazardous Substances"</B> means substances that are defined or
listed in, or otherwise classified under, any applicable Laws as "hazardous
substances," "hazardous materials," "hazardous wastes"
or "toxic substances," or any other formulation intended to define,
list or classify substances by reason of deleterious properties such as
ignitibility, corrosivity, reactivity, carcinogenicity, reproductive toxicity or
"EP toxicity," and petroleum. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"HIPAA"</B> means the Health Insurance Portability and
Accountability Act of 1996, as amended, and the related regulations and
published interpretations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Income Tax Act (Canada)"</B> means the Income Tax Act (Canada), as
amended, and the regulations thereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Indebtedness"</B> of any Person means, without duplication, (i)
all indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services (including, without limitation, reimbursement and
all other obligations with respect to surety bonds, letters of credit and
bankers' acceptances, whether or not matured, but not including obligations
to trade creditors incurred in the ordinary course of business), (ii) all
obligations of such Person evidenced by notes, bonds, debentures or similar
instruments, (iii) all indebtedness of such Person created or arising under any
conditional sale or other title retention agreements with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property), (iv) all capital lease obligations of such Person,
(v) all Indebtedness of other Persons guaranteed by such Person, (vi) all
Indebtedness referred to in clause (i), (ii), (iii), (iv) or (v) above secured
by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any lien upon or in property
(including, without limitation, accounts and contract rights) owned by such
Person, even though such Person has not assumed or become liable for the payment
of such Indebtedness, (vii) any hedging obligations with respect to the
Indebtedness referred to in clause (i), (ii), (iii), (iv), (v), or (vi) above
and (viii) any interest on or fees or costs with respect to the Indebtedness
referred to in clause (i), (ii), (iii), (iv), (v), (vi) or (vii). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Indemnified Actions"</B> means (i) those Actions set forth on
<U>TDS Schedule 4.9</U>, (ii) any Actions asserted against either TDS USA or TDS
Canada prior to the Closing Date, and (iii) any Actions asserted against either
TDS USA or TDS Canada within eighteen (18) months following the Closing Date
that arise directly from and relate solely to sales of merchandise by the
Company prior to, or other circumstances or events existing or occurring prior
to, the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Indemnified Party"</B> has the meaning specified in Section
10.3.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Indemnifying Party"</B> has the meaning specified in Section
10.3.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Information Technology"</B> means hardware, software and/or other
technology constituting part of any digital or electronic information system,
together with all services and Contracts related thereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Initial Allocation Schedule"</B> has the meaning specified in
Section 2.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Initial Canada Purchase Price"</B> has the meaning specified in
Section&#160;2.3.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Initial Purchase Price"</B> means the Estimated Closing Working
Capital Adjustment Amount paid by Buyer pursuant to Section 3.3.1, if any.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Initial USA Purchase Price"</B> has the meaning specified in
Section&#160;2.3.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Intellectual Property"</B> means (i)&#160;all patents, patent
applications, patent applications under review, and potentially patentable
ideas, (ii)&#160;all trademarks, names, brands, symbols, logos, characters,
industrial designs, merchandise designs, merchandise tools (i.e., molds, dies,
etc.) and service marks, all registrations and applications relating to the
foregoing, and the goodwill associated therewith and symbolized thereby,
(iii)&#160;all mask work rights, copyrights, copyright registrations, moral
rights and works of authorship, (iv)&#160;all Internet domain names and web
sites, (v)&#160;all work product and inventions (whether or not patented or
patentable), and (vi)&#160;any and all other comparable proprietary information,
designations and intellectual property rights, including, without limitation,
remedies against infringements thereof and rights of protection of interest
therein under the Laws of all jurisdictions. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Intellectual Property and Technology Assignment"</B> means an
Intellectual Property and Technology Assignment by TDS USA and TDS Canada, in
substantially the form attached hereto as <U>Annex B</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Intercompany Agreements and Arrangements"</B> means all Contracts
between TDS USA or TDS Canada, on the one hand, and DEI or any of its Affiliates
(other than TDS USA or TDS Canada), on the other hand, including, without
limitation, any such Contracts with respect to administration and support
services, Intellectual Property, intercompany loans of a type reflected as
"intercompany payables" or "intercompany receivables" on the
balance sheets for TDS USA and/or TDS Canada in accordance with past business
practice, tax sharing, payroll, product sourcing, supply chain, Information
Technology, employee benefits and benefits administration, legal, accounting,
treasury, insurance and strategic planning; <U>provided</U>, <U>that</U>,
"Intercompany Agreements and Arrangements" shall exclude the following
Contracts: (i) the Revolving Credit Agreement (which is a Retained Asset), (ii)
the Pre-Closing Transaction Contracts and (iii) any trade payables in the
ordinary course of business (<U>e.g.</U>, trade payables for BVHE Merchandise)
owed by the Company to DEI or any of its Affiliates (other than the Company) of
a type that have not been previously treated as "intercompany
payables". The "Intercompany Agreements and Arrangements" shall
include, without limitation, the agreements and arrangements set forth on <U>TDS
Schedule 1.1(c)</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Inventory"</B> means all inventory owned by the Company (including
merchandise inventory) as of the Closing Date, including, without limitation,
any such inventory (i) located in or on the premises of any Store (or in any
storage facility located at or near a Store), (ii) located in or on the premises
of the Distribution Center or in or on the premises of the Company's
third-party Canadian distributor, (iii) in transit to the Stores from either of
the two (2) locations identified in the preceding subparagraph (ii), or (iv)
paid for and in transit from the manufacturer or sourcing agent for such
inventory to either of the two (2) locations identified in the preceding
subparagraph (ii). For purposes of clarification, the parties hereby agree and
acknowledge that "Inventory" shall exclude any (i) inventory located
in or on the premises of, or in transit to or acquired for, the Flagship Stores
and (ii) Ordered Inventory. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Investment Canada Act"</B> means the Investment Canada Act, as
amended, and the related regulations and published interpretations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"IRS"</B> means the Internal Revenue Service or any successor
entity. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"June 2004 Working Capital Statement"</B> means a statement setting
forth the Estimated Closing Working Capital and the Estimated Closing Working
Capital Adjustment Amount, each based on the Pro Forma Balance Sheet and
calculated in good faith by DEI and Seller as if the Closing Date had occurred
on June 26, 2004, which statement is included in <U>Schedule 4.2.1</U>.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Key Employees"</B> means (i) Employees listed on <U>TDS Schedule
7.4.1</U> holding titles of, or more senior than, vice president and (ii) all
Continuing Employees not located at the Corporate Headquarters who are district
managers or general managers of the Acquired Stores, in the case of subparagraph
(i), as <U>TDS Schedule 7.4.1</U> may be amended after the date hereof in
accordance with Sections 6.3 and 7.4.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Knowledge"</B> means the actual knowledge of the applicable Person
(if such Person is a natural person) or the actual knowledge of any executive
officer of the applicable Person (if such Person is an Entity) as of the date
specified; <U>provided</U>, that (i) with respect to DEI and Seller,
"Knowledge" means the actual knowledge of any of James Fielding, Steve
Finney, Kay Murfin and Mark Rodriguez and (ii) with respect to Buyer,
"Knowledge" means the actual knowledge of any of Steve Balasiano,
Mario Ciampi, Ezra Dabah, Neal Goldberg and Seth Udasin. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Landlord"</B> means the party that, as of the Closing, holds the
landlord's or lessor's interest in a Lease. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Largest TCP Affiliate Stockholder"</B> means, with respect to each
Affiliate of TCP (other than Buyer and Buyer's Subsidiaries), the Person or
group of Persons whose beneficial ownership (within the meaning of Rule 13d-3
under the Exchange Act) of voting TCP Affiliate Securities of such Affiliate of
TCP entitles it to the largest vote in the election of the board of directors
(or comparable governing body) of such Affiliate of TCP among all holders of TCP
Affiliate Securities of such Affiliate of TCP. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Largest TCP Stockholder"</B> means the Person or group of Persons
whose beneficial ownership (within the meaning of Rule 13d-3 under the Exchange
Act) of voting TCP Securities entitles it to the largest vote in the election of
TCP's board of directors (or comparable governing body) among all holders
of TCP Securities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Law"</B>or <B>"Laws"</B> means any law, statute, order,
decree, judgment, rule, regulation, code, administrative requirement, ordinance
or other pronouncement of any Governmental Entity or having the effect of law.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Lease"</B> means any Acquired Lease or Disney Retained Lease
(including any Deferred Lease or Approved Deferred Lease) and "Leases"
means, collectively, the Acquired Leases and the Disney Retained Leases
(including the Deferred Leases and the Approved Deferred Leases). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Lease Base Rent Amounts"</B> means, with respect to a particular
Store, an amount equal to (i) the monthly base rent (or comparable payment if
designated by a different name) paid by TDS USA or TDS Canada, as applicable,
pursuant to the Lease related to such Store for the month of May 2004,
<U>multiplied by</U> (ii) twelve (12), which Lease Base Rent Amounts are set
forth opposite each Store on the Acquired Stores Schedule. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Lease Liability"</B> means, with respect to any Consent Required
Core Store, the aggregate amount of outstanding minimum rent liability under the
Lease related to such Consent Required Core Store as of October 2, 2004, as set
forth opposite such Consent Required Core Store on the Acquired Stores Schedule.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Lease Percentage Rent Amounts"</B> means, with respect to a
particular Store, the aggregate amount of percentage rent (or comparable payment
if designated by a different name) that would be required pursuant to the Lease
based on the percentage rent formula (or comparable formula if designated by a
different name) in effect on May 31, 2004, calculated using the Lease Sales
Amount for such Store, which Lease Percentage Rent Amounts are set forth
opposite each Store on the Acquired Stores Schedule. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Lease Sales Amounts"</B> means, with respect to a particular
Store, the aggregate amount of all revenues generated from all merchandise sales
in such Store for Fiscal Year 2003, excluding all relevant and permitted
exclusions pursuant to the gross sales/percentage rent provision of the Lease
for the applicable Store, which Lease Sales Amounts are set forth opposite each
Store on the Acquired Stores Schedule. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Li &amp; Fung"</B> has the meaning specified in Section 6.9.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Li &amp; Fung Agreement"</B> has the meaning specified in Section
6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"License and Conduct of Business Agreement"</B> means the License
and Conduct of Business Agreement by and among TDS Franchising, TDS USA and TDS
Canada (including the limited guarantee by DWS of the obligations of TDS
Franchising thereunder), in substantially the form attached hereto as <U>Annex
G</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"License Encumbrance Agreements"</B> has the meaning specified in
the License and Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Limited Liability Company Agreement"</B> means the Operating
Agreement for TDS USA, a copy of which has been made available to Buyer.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"LLC Distribution"</B> has the meaning specified in
Section&#160;2.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Loss"</B> means any and all claims, damages, losses, liabilities,
obligations, settlements, injunctions, suits, actions, proceedings, liens,
demands, charges, fines, penalties, costs and expenses of every kind and nature
(whether based on tort, breach of contract, product liability, patent or
copyright infringement or otherwise), including, without limitation, reasonable
fees and expenses of attorneys and other professionals. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Material Adverse Event"</B> means any fact, event or condition
that has or would reasonably be expected to have a material adverse effect on
the Business taken as a whole. The parties agree that none of the following
events or occurrences, singly or in the aggregate, shall be deemed to constitute
a Material Adverse Event to the extent that they occur on or after the date
hereof and prior to the Closing Date: (i)&#160;the loss of any Employees,
whether arising from or related to the transactions contemplated by this
Agreement or otherwise, <U>provided</U>, that such loss does not result from
Seller's or DEI's breach of Section 6.3, 7.4.1(ii) or 7.4.4;
(ii)&#160;subject to Section 8.2.2, the closure of any Store or Stores or the
financial or operational performance of any Store or Stores, <U>provided</U>,
that such events or occurrences do not result from Seller's or DEI's
breach of Section 6.3 or 6.7; (iii)&#160;events or conditions affecting TWDC or
any of its Affiliates other than the Company; (iv)&#160;any events generally
affecting the economy or world events generally, including terrorist activities
or potential or actual military conflicts; (v)&#160;events generally affecting
the industry in which the Company does business; or (vi)&#160;events or
conditions arising from the announcement of the transactions contemplated by
this Agreement. No event or condition that results from any of the foregoing
events occurring on or after the date hereof shall be deemed to constitute a
breach of any of the representations or warranties of DEI or Seller hereunder.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Material Contract"</B> means (i) any Contract pertaining to the
Business to which TDS USA or TDS Canada is a party that (A) after the Balance
Sheet Date imposes or will impose an obligation on TDS USA or TDS Canada to pay,
or under which TDS USA or TDS Canada will have the right to receive, an amount
of $300,000 or more in the aggregate, (B)&#160;creates Indebtedness of TDS USA
or TDS Canada other than in the ordinary course of business and other than any
such Indebtedness consisting of intercompany Indebtedness that will not be an
obligation of the Company as of the Closing, (C) either (I) is not terminable by
TDS USA or TDS Canada on less than one hundred fifty (150) days' prior
notice or (II) is terminable by TDS USA or TDS Canada on less than one hundred
fifty (150) days' prior notice and imposes on TDS USA or TDS Canada an
obligation to pay an amount of $300,000 or more in connection with such
termination, or (D) limits, in any material respect, the Company's ability
to conduct any business or to enter into transactions with third parties; or
(ii) any Contract between any Person who is not an Affiliate of the Company, on
the one hand, and TDS USA or TDS Canada, on the other hand, pursuant to which
such Person (A) grants TDS USA or TDS Canada the right and license to
manufacture or cause to be manufactured on its behalf consumer products bearing,
featuring or incorporating the Intellectual Property of the licensor thereunder
and (B) is entitled as the licensor to receive from TDS USA or TDS Canada
royalties for the use of such licensor's Intellectual Property.
Notwithstanding the foregoing, "Material Contracts" excludes
Employment Contracts, Employee Benefit Plans, Leases, Contracts identified on
<U>TDS Schedule 1.1(d)</U> as Retained Assets, the U.K. Lease Guarantees and the
Intercompany Agreements and Arrangements. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Membership Unit Acquisition"</B> has the meaning specified in
Section&#160;2.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Membership Units"</B> has the meaning specified in the recitals
hereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Merchant Services Agreement"</B> means that certain Amended and
Restated Merchant Services Agreement between TCP and Hurley State Bank dated as
of July&#160;1, 2000, as amended. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Michigan Avenue Store"</B> means the Disney Retained Store located
at 717 North Michigan Avenue in Chicago, Illinois. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Modified GAAP"</B> with reference to any financial statements of
TDS USA and/or TDS Canada, means that such financial statements have been
prepared in accordance with GAAP, except that they: (i)&#160;may not include all
normal year-end audit adjustments (but shall include any such normal year-end
audit adjustments (if any) that apply to inventory and/or trade payables);
(ii)&#160;may not contain notes required by GAAP; (iii)&#160;may not include
adjustments to reflect certain costs incurred by DEI or its Affiliates (other
than TDS USA or TDS Canada) on behalf of TDS USA and/or TDS Canada that would
have been included in intercompany payables had TDS USA and/or TDS Canada, as
applicable, been operating on a stand-alone basis; (iv)&#160;do not include a
provision for some or all income taxes because the tax effects accrue to DEI or
its Affiliates (other than TDS USA or TDS Canada) as the owner of TDS USA and
TDS Canada; and (v)&#160;do not and shall not include any provision for (a) any
New Rent Requirements or New Capital Expenditure Requirements or (b) any other
monetary obligations agreed to by Buyer in accordance with this Agreement in
connection with any renewal, extension, amendment or modification of any
Acquired Lease or any New Lease or in connection with obtaining any required
Consent from a Landlord under an Acquired Lease (all of which shall be the sole
responsibility of Buyer without compensation in any manner whatsoever from DEI
or Seller). Unless otherwise expressly provided herein, liabilities and
obligations that (a)&#160;are created by, or incurred pursuant to or in
connection with, this Agreement, the documents or instruments contemplated
hereby or the transactions contemplated hereby or thereby and (b)&#160;are not
reflected on the Pro Forma Balance Sheet, shall not be included on any balance
sheet prepared in connection with the working capital adjustment contemplated by
Section&#160;2.3, including, without limitation, the Closing Balance Sheet, the
Subsequent Closing Balance Sheet, Buyer's Estimated Closing Balance Sheet,
Buyer's Estimated Subsequent Closing Balance Sheet, the Final Closing
Balance Sheet or the Final Subsequent Closing Balance Sheet. In addition, unless
otherwise expressly provided herein (including, without limitation, in the
provisos in the definitions of "Current Assets" and "Current
Liabilities"), "Modified GAAP" means that, with respect to any
items (such as reserves or accruals) that are determined by estimation, any
estimates made by DEI or Seller in connection with the preparation of any
balance sheet used for purposes of the working capital adjustment contemplated
by Section&#160;2.3, including, without limitation, the Closing Balance Sheet,
that has a reasonable basis in Modified GAAP shall not be adjusted in any manner
whatsoever in connection with the preparation of any other balance sheet used
for purposes of the working capital adjustment contemplated by Section&#160;2.3,
including, without limitation, the Subsequent Closing Balance Sheet,
Buyer's Estimated Closing Balance Sheet, Buyer's Estimated Subsequent
Closing Balance Sheet, the Final Closing Balance Sheet or the Final Subsequent
Closing Balance Sheet. For the avoidance of doubt, the preceding sentence shall
not apply to the projected results of transactions that occur between the date
on which the Closing Balance Sheet is prepared by the Company, DEI and Seller
and the Closing Date, as such projections are made in good faith by the Company,
DEI and Seller pursuant to Section 2.3.1, which projections may be adjusted to
reflect the actual results of such transactions in connection with Buyer's
preparation of the Buyer's Estimated Closing Balance Sheet pursuant to
Section 2.3.2(a). For purposes of clarification, any Indebtedness owed by TDS
USA or TDS Canada to DEI or any of its Affiliates (other than TDS USA or TDS
Canada), or vice versa, of a type that has been, in accordance with past
business practice, categorized as an "intercompany payable" or an
"intercompany receivable" on the balance sheets for TDS USA and/or TDS
Canada would not, in accordance with GAAP and Modified GAAP and the terms of
this Agreement, be reflected on the balance sheets for TDS USA or TDS Canada as
an "intercompany payable" or an "intercompany receivable,"
but instead, the net of such amounts would be and shall be reflected on such
balance sheets as a credit (or, as applicable, a debit) to the
stockholder's equity of TDS USA or TDS Canada (as applicable) as a result
of the cancellation of any such "intercompany payables" and
"intercompany receivables" and the corresponding contributions of such
net amounts to the capital of TDS USA or TDS Canada in accordance with this
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Monogram"</B> has the meaning specified in Section 6.9.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Monogram Agreement"</B> has the meaning specified in Section
6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Monogram Participation Agreement"</B> means a "Participation
Agreement," as defined in and contemplated by the Monogram Agreement,
regarding participation in the credit card program established by Monogram
pursuant to the Monogram Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Month-to-Month Acquired Leases"</B> means Acquired Leases under
which TDS USA's or TDS Canada's tenancy is, as of the date hereof or
as of any date prior to or including the Closing Date, month-to-month.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Multiemployer Plan"</B> means any "multiemployer plan"
as defined in Section 4001(a)(3) of ERISA that is (or was) subject to Title IV
of ERISA. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Mutual Fund"</B> shall mean any open-end investment fund commonly
known as a "mutual fund" that combines the funds of numerous
individual investors, invests such funds in a variety of securities, and enables
each individual investor to participate on a pro rata basis in all such
investments through such investor's interest in the mutual fund;
<U>provided</U>, that, for purposes of this Agreement, any Mutual Fund that is
sponsored, established, administered, controlled or operated by a Person who
would be a Disqualified Person but for subparagraph (6) of the definition of
"Disqualified Person" shall be excluded from the definition of
"Mutual Fund." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"NAP"</B> has the meaning specified in Section 6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"NAP Agreement"</B> has the meaning specified in Section 6.9.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"New Capital Expenditure Requirements"</B> has the meaning
specified in Section&#160;6.7.1(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"New Lease"</B> has the meaning specified in Section&#160;6.7.1(b).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"New Rent Acquired Stores"</B> has the meaning specified in
Section&#160;6.7.1(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"New Rent Requirements"</B> has the meaning specified in
Section&#160;6.7.1(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"New TDS Canada"</B> means Hoop Canada, Inc., a corporation
incorporated under the laws of the Province of New Brunswick and that will be
solely owned by Canadian Purchaser. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"New TDS Canada Securities"</B> means the Securities of New TDS
Canada in whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"New TDS LLC"</B> means Hoop Retail Stores, LLC, a Delaware limited
liability company that is solely owned by USA Purchaser and is the parent of
Canadian Purchaser. Immediately following the Closing, USA Purchaser shall cause
TDS USA to be merged with and into New TDS LLC in accordance with
Section&#160;2.6.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"New TDS LLC Securities"</B> means the Securities of New TDS LLC in
whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Non-Core Stores"</B> means the Stores designated as "Non-Core
Stores" on the Acquired Stores Schedule or the Deferred Stores Schedule, as
applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Non-IT Intellectual Property"</B> means any and all Intellectual
Property that is owned, licensed, used or controlled by TDS USA or TDS Canada
other than any Intellectual Property that is embodied solely in the Company
Information Technology. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Non-LC Purchase Order"</B> means any Pre-Closing Inventory Order
with respect to which a letter of credit in support thereof was not issued prior
to the Closing, for whatever reason. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Non-Signatory Dispute"</B> has the meaning specified in Section
11.17.15. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Non-Transferable Stores"</B> has the meaning specified in
Section&#160;6.7.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Obligations"</B> has the meaning specified in the Acquisition
Agreement Guarantee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Obligor"</B> has the meaning specified in Section 6.11.11.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Ocean Sky"</B> has the meaning specified in Section 6.9.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Ocean Sky Agreement"</B> has the meaning specified in Section
6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"OLC"</B> has the meaning specified in Section 6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"OPEIU Agreement"</B> has the meaning specified in Section 4.18.2.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Operating Expenses"</B> means, with respect to any Acquired Lease,
amounts (if any) payable by the tenant pursuant to such Acquired Lease to the
applicable Landlord, typically monthly, solely for the tenant's share of
(i) real estate taxes and impositions, (ii) insurance costs, (iii) so-called
"common area maintenance" costs, (iv) utilities and (v)
merchants' association dues, in each case in accordance with the terms of
the applicable Acquired Lease. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Operational Representations"</B> means those representations and
warranties of (i) DEI and Seller contained in Article IV that are not
Fundamental Representations of DEI and Seller and (ii) Buyer contained in
Article V that are not Fundamental Representations of Buyer. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Ordered
Inventory"</B> means inventory covered by or included in a Pre-Closing
Inventory Order with respect to which, as of the Closing Date, a letter of
credit has been issued pursuant to a Trade LC Facility, but has not yet been
drawn. For purposes of clarification, the parties hereby agree that (i) if any
such letter of credit issued pursuant to a Trade LC Facility has been drawn,
such inventory shall be deemed to be included under the definition of
"Inventory" and (ii) "Ordered Inventory" shall exclude any
such inventory located in or on the premises of, or in transit to or acquired
for, the Flagship Stores. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Outlet Store"</B> means a retail store that offers products to
consumers with an emphasis on low prices, a material purpose of which is
liquidating excess, obsolete or otherwise slow-moving inventory from other
related retail activities (<U>e.g.</U>, a "Gap" outlet would liquidate
inventory from the "Gap" chain of specialty retail clothing stores).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Outstanding Canadian Purchaser Securities"</B> means the Canadian
Purchaser Securities outstanding as of any particular date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Outstanding New TDS Canada Securities"</B> means the New TDS
Canada Securities outstanding as of any particular date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Outstanding New TDS LLC Securities"</B> means the New TDS LLC
Securities outstanding as of any particular date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Outstanding TCP Securities"</B> means the TCP Securities
outstanding as of any particular date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Outstanding USA Purchaser Securities"</B> means the USA Purchaser
Securities outstanding as of any particular date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Parent Affiliate"</B> means, with respect to any Person, an
Affiliate of such Person who owns a majority of the outstanding voting equity
Securities of such Person. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Partial TDS Canada Section 116 Certificate"</B> has the meaning
specified in Section&#160;3.5.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Participation Agreements"</B> has the meaning specified in Section
6.10.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Party Designations"</B> has the meaning specified in Section
11.17.5(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"PBGC"</B> means the Pension Benefit Guaranty Corporation.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Pension Fund"</B> means an "employee pension benefit plan" within the
meaning of Section 3(2) of ERISA that is either (i) subject to the requirements
of Section 403(a) of ERISA or (ii) described in Sections 3(32), 3(33) or 4(b)(4)
of ERISA; <U>provided</U>, that, for purposes of this Agreement, any Pension
Fund (a) that is sponsored, established, administered, controlled, managed or
operated by a Person who would be a Disqualified Person but for subparagraph (6)
of the definition of "Disqualified Person" or (b) the majority of the funds of
which is contributed by a Person and/or the employees of a Person who would be a
Disqualified Person but for subparagraph (6) of the definition of "Disqualified
Person," shall be excluded from the definition of "Pension Fund." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Permits"</B> means any approval, authorization, consent, qualification,
registration, license, permit, franchise, certificate of authority or order, or
any waiver of the foregoing, required to be obtained from or issued by, or any
notice, statement or other communication required to be filed with or delivered
to, any Governmental Entity, including in connection with any applicable
franchise Laws. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Permitted Encumbrance"</B> means any Encumbrance that (i)&#160;is reflected
or disclosed in the Financial Statements, including any notes thereto;
(ii)&#160;constitutes a statutory lien or other lien not securing obligations
for borrowed money arising in the ordinary course of business; (iii)&#160;is a
lease for personal property and is reflected on <U>TDS Schedule 4.5</U> or
entered into in the ordinary course of business; or (iv)&#160;does not
materially detract from the value of the Company's interest in the property in
question or materially detract from or interfere with the use of such property
in the ordinary conduct of the Business as currently conducted. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Person"</B> means any natural person or Entity. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Per Store Inventory Allocation"</B> means an amount of Inventory equal to
(i) the aggregate book value of all Inventory <U>divided by</U> (ii) the sum of
(A) the total number of Stores (including the Acquired Stores, the Disney
Retained Stores and the Deferred Stores) in operation as of the Closing Date
other than the Flagship Stores plus (B) four (4). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Per Store Ordered Inventory Allocation"</B> means an amount of Ordered
Inventory equal to (i) the aggregate book value of all Ordered Inventory
(assuming that such Ordered Inventory were reflected on the books of the Company
as of the Closing Date) <U>divided by</U> (ii) the sum of (A) the total number
of Stores (including the Acquired Stores, the Disney Retained Stores and the
Deferred Stores) in operation as of the Closing Date other than the Flagship
Stores, <U>plus</U> (B) four (4). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Post-Closing Adjustment Amount"</B> means the positive or negative amount
equal to (i)&#160;the Final Working Capital Adjustment Amount <U>minus</U>
(ii)&#160;any Estimated Closing Working Capital Adjustment Amount paid at the
Closing (and, if applicable, the Working Capital Deferred Delivery Date)
pursuant to Section 3.2 or 3.3, as applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Post-Closing Inventory Orders"</B> means inventory purchase orders issued by
the Company (as a Subsidiary of Buyer) following the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Post Street Store"</B> means the Disney Retained Store located at 400 Post
Street in San Francisco, California. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Pre-Closing
Inventory Orders" </B>has the meaning specified in Section 6.11.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Pre-Closing Transaction Contracts"</B> means all Contracts giving effect to,
or entered into connection with, the transactions specified in Sections 2.1.1,
2.1.2, 2.1.3 and 2.1.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Pre-Closing Transactions"</B> has the meaning specified in Section&#160;2.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Pre-Signing Company Drafts"</B> means the draft dated October 14, 2004 of
the Company Credit Facility and the related Designation of Secured Lender Under
License Agreement, which are attached hereto as <U>Annex H</U>, together with
Section 16.5 of the License and Conduct of Business Agreement in the form
attached to this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Pre-Signing Wells Draft"</B> means the draft dated October 14, 2004 of the
Wells Fargo Credit Facility attached hereto as <U>Annex I</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Prime Rate"</B> means the base rate on corporate loans at large United
States money center commercial banks as such rate is reported under "prime rate"
in The Wall Street Journal from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Priority Designations"</B> has the meaning specified in Section 11.17.5(d).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Pro Forma Balance Sheet"</B> has the meaning specified in
Section&#160;4.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"PWC"</B> means PricewaterhouseCoopers LLC. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Related Agreements"</B> means the License and Conduct of Business Agreement
and the Deferred Lease Assignment and Assumption Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Remittance Date"</B> has the meaning specified in Section&#160;3.5.3.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Representatives"</B> means, with respect to any Person, the officers,
directors, employees, managers, partners, agents, consultants, advisors
(including legal advisors, financial advisors and accountants), contractors and
subcontractors of such Person. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Retail Facilities"</B> means retail shopping mall, outlet center or strip
mall facilities primarily focused on retail sales of consumer products.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Retained Asset Agreements"</B> has the meaning specified in Section 6.9.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Retained Assets"</B> means all Contracts, properties, assets and rights
owned, leased, licensed, controlled or held by TDS USA and/or TDS Canada that
are not related solely to, or are not used solely in connection with the
operation of, or are not intended solely for the benefit of, the Business,
including those Contracts, properties, assets and rights set forth on <U>TDS
Schedule 1.1(d)</U> hereto. For purposes of clarification, "Retained Assets"
will not include the Contracts, properties, assets and rights specifically set
forth on the Company Assets Schedule, which will be retained by the Company as
of the Closing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Retained Liabilities"</B> means all liabilities, obligations and commitments
arising directly under or solely in connection with the Retained Assets.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Retention Payment"</B> has the meaning specified in Section 7.4.5.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Retention Program"</B> means the retention program established by the
Company prior to the date of this Agreement with respect to certain of the
Employees, but specifically excluding the Transition Retention Program.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Revolving Credit Agreement"</B> means the Revolving Credit Agreement dated
as of May 10, 2004 between DEI and TDS USA. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"RNC"</B> has the meaning specified in Section 6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"SEC"</B> means the Securities and Exchange Commission. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Second Largest TCP Affiliate Stockholder"</B> means, with respect to each
Affiliate of TCP (other than Buyer and Buyer's Subsidiaries), the Person or
group of Persons whose beneficial ownership (within the meaning of Rule 13d-3
under the Exchange Act) of voting TCP Affiliate Securities of such Affiliate of
TCP entitles it to the second largest vote (after the Largest TCP Affiliate
Stockholder) in the election of the board of directors (or comparable governing
body) of such Affiliate of TCP among all holders of TCP Affiliate Securities of
such Affiliate of TCP. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Second Largest TCP Stockholder"</B> means the Person or group of Persons
whose beneficial ownership (within the meaning of Rule 13d-3 under the Exchange
Act) of voting TCP Securities entitles it to the second largest vote (after the
Largest TCP Stockholder) in the election of TCP's board of directors (or
comparable governing body) among all holders of TCP Securities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Section 116 Certificate"</B> has the meaning specified in
Section&#160;3.5.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Securities"</B> means any and all debt and equity securities and other
ownership interests in whatever form, including, without limitation, common
stock or shares, preferred stock or shares or other capital stock, membership,
partnership or participation interests or units, and notes, bonds, debentures or
other similar debt instruments, including, without limitation, any securities,
warrants, options or rights convertible into or exercisable for any of the
foregoing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Securities Act"</B> means the Securities Act of 1933, as amended.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Seller"</B> has the meaning specified in the preamble to this Agreement.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Seller Consent Officers"</B> means Steve Finney, James Kapenstein, Grace
Liang, Aldo Manzini and Mark Rodriguez. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Seller Disqualifying Event"</B> means (i)&#160;a negligent act or omission
or willful misconduct of a Person otherwise required to be indemnified under
Section&#160;10.2.4 (<U>provided</U>, <U>that</U>, for purposes of
clarification, Seller's or DEI's conduct of, or failure to conduct, due
diligence shall not, as applicable, constitute a negligent act or omission),
(ii)&#160;any reorganization or change in ownership of DEI, Seller or any of
their Affiliates, (iii)&#160;any change by DEI, Seller or any of their
Affiliates in the accounting basis on which its assets are valued or the
accounting basis, method, policy or practice on which its financial statements
are prepared, or (iv)&#160;any change in GAAP after the Closing Date.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Share Acquisition"</B> has the meaning specified in Section&#160;2.2.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Shares"</B> has the meaning specified in the recitals hereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Signing Date Acquired Stores"</B> means the Acquired Stores set forth on the
Acquired Stores Schedule on the date of this Agreement (<U>i.e.</U>, prior to
any amendment of the Acquired Stores Schedule pursuant to Section&#160;6.7.2 or
6.7.3). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"SKUs"</B> means stock keeping units. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Softlines"</B> has the meaning specified in the License and Conduct of
Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Specialty Retail Store"</B> has the meaning specified in the License and
Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Standard Chartered Facility"</B> means the Banking Facility Letter dated
January 16, 2004 among Standard Chartered Bank, TDS USA (as successor to The
Disney Store, Inc.), DWS, The Disney Store Limited, Disney Auctions L.L.C., ABC
Cable Networks Group, Buena Vista Theatrical Merchandise L.L.C. and Disney
Direct Marketing Services, Inc. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Store Adjustment Methodology"</B> means, in connection with the preparation
of any balance sheet of the Company or any portion of its operations that
reflects the addition or deletion of, or the operations solely of, any
Non-Transferable Stores, Expired Lease Stores, Deferred Stores or Approved
Deferred Stores, that such balance sheet shall take into account, in a manner
consistent with the manner in which Stores were deleted from the Pro Forma
Balance Sheet, only the properties, assets, liabilities and obligations directly
related to such Stores, including, without limitation, the respective Leases for
such Stores, the furniture, fixtures and equipment located in such Stores, the
Per Store Inventory Allocation and the Per Store Ordered Inventory Allocation
for such Stores, and the employees who work in such Stores. For purposes of
clarification, any calculation of Current Assets for the Approved Deferred
Stores shall include the Approved Deferred Store Inventory Amount and the
Approved Deferred Store Ordered Inventory Amount, but shall exclude any other
amount for inventory. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Store-Related Assets and Liabilities"</B> means all properties, assets,
rights, liabilities and obligations relating to the conduct and operation of the
Business pertaining to the Approved Deferred Stores, including, without
limitation, the inclusion of the Approved Deferred Store Inventory Amount and
the Approved Deferred Store Ordered Inventory Amount as a Current Asset.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Stores"</B> means the specialty retail stores operated by TDS USA or TDS
Canada under the "Disney Store" name on the date of this Agreement. For purposes
of clarification, the Stores include the Acquired Stores, the Disney Retained
Stores and the Deferred Stores. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Strike Notices"</B> has the meaning specified in Section 11.17.5(c).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Subsequent Closing"</B> has the meaning specified in Section&#160;6.7.3(d).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Subsequent Closing Balance Sheet"</B> has the meaning specified in
Section&#160;6.7.3(c). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Subsequent Closing Date"</B> means the date of the Subsequent Closing.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Subsequent Closing Period"</B> has the meaning specified in Section
6.7.3(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Subsequent Closing Working Capital Baseline"</B> means (i)&#160;the Average
Per Store Working Capital Value, <U>multiplied by</U> (ii)&#160;the number of
Approved Deferred Stores set forth on the Approved Deferred Stores Schedule as
of the Subsequent Closing Date; <U>provided</U>, <U>that</U>, for purposes of
the foregoing subparagraph (ii), if applicable, the Ala Moana Store and the
Caesar's Palace Store shall each be treated as two (2) Stores (such that the
Subsequent Closing Working Capital Baseline with respect to each such Store
shall be equal to twice the Average Per Store Working Capital Value).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Subsidiaries"</B>, as to any Person, means an Entity of which equity
Securities having ordinary voting power (other than Securities having such power
only by reason of the happening of a contingency) to elect a majority of the
directors, managers, trustees or other comparable controlling persons of such
Entity are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries, or both,
by such Person. With respect to the Company, its "Subsidiaries" shall be deemed
to exclude TDS Franchising, Disney Rewards, LLC, The Walt Disney Company (Asia
Pacific) Limited and The Disney Store (Australia) Pty Ltd., all Securities of
which are Retained Assets and will be distributed out of TDS USA to Seller prior
to the Closing pursuant to the LLC Distribution. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"SunTrust"</B> means SunTrust Bank.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"SunTrust
Agreement"</B> means the SunTrust Merchant Services Agreement, dated February 6,
2001, by and between The Disney Store, Inc. and SunTrust, as modified and
supplemented by the Addendum to Merchant Bank Card Agreement by and between The
Disney Store, Inc. and SunTrust. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Superior
Proposal"</B> means a Competing Offer from a third party that the Board of
Directors of TWDC determines in its good faith judgment (following consultation
with TWDC's financial advisor) to have economic terms that are more favorable in
the aggregate to the stockholders of TWDC than the Membership Unit Acquisition
and the Share Acquisition (taking into account all factors that such Board of
Directors may deem relevant, including, in the judgment of such Board of
Directors, the amount and form of consideration to be received in the
transaction, the timing of and likelihood of closing such Competing Offer, and
the relative value of any non-cash consideration). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Supplemental
Disclosure Items"</B> has the meaning specified in Section 6.2.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Supporting
LCs"</B> means, collectively, one or more standby letters of credit (in form and
substance approved by DEI and Seller in accordance with Section 6.11.6) issued
pursuant to the Company Credit Facility for the benefit of DEI and/or its
Affiliates, to support the payment of (i) amounts outstanding under letters of
credit issued (but not drawn) under a Trade LC Facility in connection with, or
as a payment mechanism for, Buyer Ordered Inventory and/or (ii)&#160;Disney
Umbrella Freight Services Amounts. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Tax"</B> or <B>"Taxes"</B> means (i)&#160;any and all federal, state,
provincial, local, municipal and foreign taxes, assessments and other
governmental charges, duties, impositions and liabilities of any kind, including
taxes or other charges based upon or measured by gross receipts, income,
profits, sales, capital, use and occupation, and value added, goods and
services, ad valorem, transfer, franchise, withholding, payroll, recapture,
employment, personal property, excise, duty, customs and real estate taxes, and,
in addition to the foregoing, with respect to TDS Canada, Canada Pension Plan
and provincial pension plan contributions, employment and unemployment insurance
contributions, worker's compensation and deductions at source, together, in each
case, with all interest, penalties and additions imposed with respect to such
amounts; (ii)&#160;any liability for the payment of any amounts of the type
described in subparagraph&#160;(i) as a result of being a member of an
affiliated, consolidated, combined or unitary group for any period; and
(iii)&#160;any liability for the payments of the amounts of the types described
in subparagraph&#160;(i) or (ii) as a result of being a transferee of, or a
successor in interest to, any Person or as a result of an express or implied
obligation to indemnify any Person (other than an indemnification obligation
arising under this Agreement). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Tax
Proceeding"</B> has the meaning specified in Section 7.1.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Tax Purchase Price"</B> means the aggregate amount, calculated using United
States Federal income tax principles, that must be allocated to the assets of
TDS USA. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Tax Return"</B> means a report, return or other information or form required
to be supplied to a Governmental Entity with respect to Taxes, including, where
permitted or required, combined or consolidated returns for any group of
entities that includes any Affiliate. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Tax Sharing Agreement"</B> means a Contract between or among DEI and/or any
of its Affiliates other than TDS USA and TDS Canada, on the one hand, and TDS
USA and/or TDS Canada, on the other hand, relating to the allocation of
responsibility for tax liability between or among the parties thereto.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TCP"</B> means The Children's Place Retail Stores, Inc., a Delaware corporation and
the Parent Affiliate of Buyer.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP Affiliate
Securities"</B> means Securities of any Subsidiary of TCP other than Buyer, New
TDS LLC, New TDS Canada and Buyer's other Subsidiaries (including, from and
after the Closing, the Company and its Subsidiaries), in whatever form.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TCP Guaranty and Commitment"</B> means a Guaranty and Commitment by TCP and
Buyer in favor of TDS USA, TDS Canada and TDS Franchising, in substantially the
form attached hereto as <U>Annex C</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TCP Intercompany Services Agreement"</B> means the Intercompany Services
Agreement by and among TCP and/or its Affiliates, on the one hand, and the
Company and/or its Subsidiaries, on the other hand, in substantially the form
attached to the License and Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP
Securities"</B> means the Securities of TCP in whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS Audited
Financial Statements"</B> has the meaning specified in Section 6.13. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TDS Canada"</B> has the meaning specified in the recitals to this Agreement
(giving effect to the last sentence of Section 2.6.2). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS Canada
Withheld Amount"</B> has the meaning specified in Section&#160;3.5.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS
Franchising"</B> means TDS Franchising, LLC, a California limited liability
company. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TDS Japan"</B> has the meaning specified in Section 6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TDS USA"</B> has the meaning specified in the recitals to this Agreement
(giving effect to the last sentence of Section 2.6.1). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS USA
Merger"</B> has the meaning specified in Section 2.6.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS
Schedules"</B> means those certain disclosure schedules that have been
separately delivered by DEI and/or Seller to Buyer concurrently with the
execution of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TDSJ IT Services Agreement"</B> has the meaning specified in Section 6.9.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TDSJ License Agreement"</B> has the meaning specified in Section 6.9.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Termination Date"</B> has the meaning specified in Section 9.1.5.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Theme Park"</B> means either an individual facility or a group, district or
other assemblage of facilities that is known, identified, promoted or held out
to the public as a common or unified complex, in either case offering
amusement-style attractions and/or rides (<U>e.g.</U>, roller coasters, "Space
Mountain," "It's a Small World," or the "Jaws" attraction at Universal Studios
Theme Park) and/or other substantially similar forms of entertainment,
regardless of whether a fee is charged to gain entry or admission thereto;<U>
provided</U>, <U>that</U>, "Theme Park" shall not include (i) any local, county
or state fairs, sporting arenas or sporting events or museums or (ii) any
facilities that offer amusement-style attractions and/or rides but with respect
to which the offering of such amusement-style attractions and/or rides does not
comprise more than, in the case of Retail Facilities, fifteen percent (15%), and
in the case of all other facilities, five percent (5%), of the total square
footage of such facilities that is open to the general public (<U>e.g</U>. a
gambling casino, such as the New York, New York hotel and casino in Las Vegas,
that offers amusement-style rides or games in one portion of the lobby of the
casino), <U>provided</U>, that the carveouts described in this subparagraph (ii)
shall not apply to any facility that is adjacent to, contained within, or held
out to the public as being a part of, a facility that is a "Theme Park" within
the terms of this definition. By way of example, and for illustration purposes
only, the following venues (and all components thereof) are Theme Parks for the
purposes of this definition: MAGIC KINGDOM&#174; Park, DISNEYLAND&#174; Resort,
WALT DISNEY WORLD&#174; Resort, DISNEYLAND Resort PARIS, Cedar Point, Six Flags,
LEGOland, Busch Gardens, Universal&#174; Studios and Sea World&#174;.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Theme Park Ticket Agreements"</B> means any intercompany agreement between
DEI or its Affiliates (other than the Company), on the one hand, and the
Company, on the other hand, pertaining to the purchase of Theme Park tickets by
the Company for sale through the Stores, including, without limitation, the
Domestic Retailer Ticket Agreement entered into as of January 1, 2003 by and
between WDPR and TDS USA, as amended. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Third Party
Claims"</B> has the meaning specified in Section 10.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Toronto-Dominion Facility"</B> means that certain Agreement dated as of
May&#160;23, 2002 between The Children's Place (Canada) LP and Toronto-Dominion
Bank, as amended. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Trade LC
Facility"</B> means any bank, credit or other comparable lending facility
pursuant to which DEI or any of its Affiliates is the obligor and under which
letters of credit have been issued in connection with, or as a payment mechanism
for, inventory purchase orders issued by the Company, including, without
limitation, the Standard Chartered Facility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Transaction
Taxes"</B> has the meaning specified in Section 7.1.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Transfer"</B> means any issuance, sale, transfer, assignment, subletting,
hypothecation, pledge as security or collateral, Encumbrance or other
disposition, in whole or in part, whether voluntarily or involuntarily, whether
by gift, bequest or otherwise. In the case of a hypothecation, pledge or
Encumbrance, the Transfer shall be deemed to occur both at the time of the
initial pledge and at any pledgee's sale, any sale by any secured creditor, or
any retention by any secured creditor of the pledge assets in complete or
partial satisfaction of the indebtedness for which such assets are security.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Transitional
Administrative Services Agreement"</B> has the meaning specified in Section
6.15.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Transitional
Disney Retained Stores Agreement"</B> has the meaning specified in Section
6.15.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Transitional
Distribution Services Agreement"</B> has the meaning specified in Section
6.15.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Transitional
Information Technology Services Agreement"</B> has the meaning specified in
Section 6.15.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Transition
Employees"</B> has the meaning specified in Section 7.4.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Transition Letter Agreement"</B> has the meaning specified in Section 7.4.5.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Transition
Retention Program"</B> has the meaning specified in Section 7.4.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Transition Services Termination Date"</B> has the meaning specified in
Section 7.4.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Trial
Balance"</B> means the pro forma trial balance of the Company as of June 26,
2004 giving effect as of such date to the Pre-Closing Transactions, as attached
to the Financial Statements and included in <U>TDS Schedule 4.2.1</U>.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"TWDC"</B> means The Walt Disney Company, a Delaware corporation.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"U.K. Lease Guarantees"</B> means guarantees, lines of credit, letters of credit or
comparable agreements or arrangements entered into by TDS USA under which, prior
to the Closing, TDS USA guaranteed or otherwise ensured or secured some or all
of the obligations of its Affiliates (other than TDS Canada), including, without
limitation, the agreements and arrangements set forth on <U>TDS Schedule
6.7.1</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"USA
Purchaser"</B> has the meaning specified in the preamble to this Agreement.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"USA Purchaser
Securities"</B> means the Securities of USA Purchaser in whatever form.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"ValueLink
Agreement"</B> means the Enterprise Stored Value Card Agreement, dated as of
September 9, 2004, by and between Disney Gift Card Services, Inc., a Virginia
corporation, and ValueLink, LLC, a Delaware limited liability company (d/b/a
ValueLink). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"ValueLink
Participation Agreement"</B> means a participation agreement, as contemplated by
the ValueLink Agreement, regarding participation in the gift card program
established pursuant to the ValueLink Agreement by Persons who are not
Affiliates of Disney Gift Card Services, Inc. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"WDPR"</B> has the meaning specified in Section 6.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Wells Fargo"</B> means Wells Fargo Retail Finance LLC.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Wells Fargo Credit Facility"</B> means a loan and security agreement (or an
amendment of an existing loan and security agreement) among TCP, Wells Fargo (as
Agent) and the financial institutions named therein to be entered into after the
date hereof and on or prior to the Closing Date pursuant to and in accordance
with Section 6.11.7. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Working Capital Deferred Delivery Date"</B> means December 24, 2004 or, if
the Closing occurs after December 24, 2004, the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Interpretation</U>. Except as otherwise
expressly provided in this Agreement, the following rules shall apply hereto:
(i)&#160;the singular includes the plural and the plural includes the singular;
(ii)&#160;"or" is not exclusive, and "include" and "including" are not limiting;
(iii)&#160;a reference to any Contract includes any permitted modifications,
supplements, amendments, restatements, renewals, extensions and replacements;
(iv)&#160;a reference in this Agreement to a section or annex is to the section
of or annex to this Agreement unless otherwise expressly provided; (v)&#160;a
reference to a section or paragraph in this Agreement shall, unless the context
clearly indicates to the contrary, refer to all sub-parts or sub-components of
any said section or paragraph; (vi)&#160;words such as "hereunder," "hereto,"
"hereof" and "herein," and other words of like import shall, unless the context
clearly indicates to the contrary, refer to the whole of this Agreement and not
to any particular clause hereof; (vii)&#160;a reference in this Agreement to a
"party" (whether in the singular or the plural) shall (unless otherwise
indicated herein) include both natural persons and Entities;
(viii)&#160;references herein to "Dollars" or "$" shall mean United States
dollars unless otherwise specifically stated; and (ix)&#160;with respect to any
matter requiring the approval or consent of either party hereunder, if no other
standard for granting or denying such approval or consent is provided in this
Agreement, such determination shall be made by the respective party in its sole
discretion. </FONT></P>

<P ALIGN=CENTER><B>ARTICLE II<BR>
MEMBERSHIP UNIT AND SHARE ACQUISITION</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Pre-Closing Transactions</U>. DEI, Seller
and Buyer hereby acknowledge and agree that, prior to the Closing, the following
transactions (collectively, the <B>"Pre-Closing Transactions"</B>) shall be
effected by DEI and Seller: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Distribution
to Member</U>. Subject to obtaining the requisite Consents with respect to the
distribution to Seller of the Retained Assets, Seller shall cause TDS USA to
distribute to Seller, TDS USA's sole member, the Retained Assets then held by
TDS USA and, if applicable pursuant to Section&#160;6.7.3, the Deferred Leases
to which TDS USA is a party and all properties, assets, rights, liabilities and
obligations relating to the conduct and operation of the Business pertaining to
the Deferred Stores by TDS USA prior to the Closing Date (the <B>"LLC
Distribution"</B>); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Transfer by
TDS Canada</U>. Subject to obtaining the requisite Consents with respect to the
Transfer to Canadian Transferee of the Retained Assets, DEI shall cause TDS
Canada to Transfer to Canadian Transferee the Retained Assets then held by TDS
Canada and, if applicable pursuant to Section&#160;6.7.3, the Deferred Leases to
which TDS Canada is a party and all properties, assets, rights, liabilities and
obligations relating to the conduct and operation of the Business pertaining to
the Deferred Stores by TDS Canada prior to the Closing Date (the
<B>"Canadian Transfer"</B>); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Transfer of
Intellectual Property and Technology</U>. DEI and Seller shall cause TDS USA and
TDS Canada to execute the Intellectual Property and Technology Assignment; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Intercompany
Agreements and Arrangements</U>. DEI and Seller shall cause the Company and the
other parties to the Intercompany Agreements and Arrangements to terminate the
Intercompany Agreements and Arrangements. For purposes of clarification, (i)
upon termination pursuant to this Section&#160;2.1.4, all Tax Sharing Agreements
will have no further effect for any taxable year (whether the current year, a
future year or a past year), (ii) trade payables in the ordinary course of
business (<U>e.g.</U>, trade payables for BVHE Merchandise) owed by the Company
to DEI or any of its Affiliates (other than the Company) of a type that have not
been previously treated as "intercompany payables" shall not be terminated
pursuant to this Section&#160;2.1.4, (iii) the Revolving Credit Agreement (which
is a Retained Asset) and the Pre-Closing Transaction Contracts shall not be
terminated pursuant to this Section 2.1.4 and (iv)&#160;termination of the Theme
Park Ticket Agreements pursuant to this Section&#160;2.1.4 shall be on a
going-forward basis only, the Theme Park Ticket Agreements shall remain in
effect with respect to any tickets sold to or by the Company prior to the
Closing or otherwise held in inventory by the Company as of the Closing, and any
such tickets shall remain subject to the terms of the applicable Theme Park
Ticket Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
least five (5) Business Days prior to effecting any of the Pre-Closing
Transactions, DEI and Seller shall provide Buyer (or, in the case of any
Pre-Closing Transactions effected prior to the date hereof, DEI and Seller shall
provide Buyer as soon as reasonably practicable after the date hereof) with a
copy of each document or instrument designed to give effect to the Transfers or
terminations contemplated in Sections 2.1.1, 2.1.2, 2.1.3 and 2.1.4 (but, for
the avoidance of doubt, excluding any other Contracts entered into in connection
therewith that will not, following the Closing, impose any material liabilities
or obligations on the Company other than any such liabilities or obligations
imposed pursuant to, or otherwise contemplated by, this Agreement, the License
and Conduct of Business Agreement or any other Related Agreement or the TCP
Guaranty and Commitment, such as, by way of example only and without limitation,
forms of consents and additional intercompany agreements and licenses). Such
documents and instruments shall be provided to Buyer for review purposes only,
and not for approval; <U>provided</U>, <U>that</U>, DEI and Seller shall
consider in good faith any comments of Buyer provided to DEI and Seller within
three (3) Business Days after receipt thereof, but any final determination as to
whether to accept or reject any such comments shall be made by DEI and Seller in
their respective sole discretion. DEI and Seller shall ensure that none of such
documents or instruments shall conflict with, violate or breach any provision of
this Agreement or any Related Agreement. Notwithstanding anything to the
contrary contained in this Section 2.1, none of USA Purchaser, Canadian
Purchaser or their Affiliates, including the Company following the Closing,
shall have any material liability or obligation in connection with the
Pre-Closing Transactions or any documents or instruments relating thereto, other
than (i) those imposed pursuant to, or otherwise contemplated by, this
Agreement, the License and Conduct of Business Agreement, any other Related
Agreement or the TCP Guaranty and Commitment, (ii) those for which DEI and/or
Seller have provided indemnification pursuant to the terms of this Agreement,
the License and Conduct of Business Agreement, any other Related Agreement or
the TCP Guaranty and Commitment, (iii) those reflected as a Current Liability on
the Final Closing Balance Sheet and/or the Final Subsequent Closing Balance
Sheet, (iv) those consisting of obligations to provide customary assistance,
including the execution of documents and powers of attorney granted for such
purpose, in connection with the transfer of the assets subject to such documents
or instruments and those consisting of other reasonably comparable obligations
that are customary in transactions of the types contemplated by the Pre-Closing
Transactions, and (v) those that are not covered, directly or indirectly, by any
of the preceding subparagraphs (i) through (iv) but for which DEI and/or Seller
agree to reimburse Buyer and its Affiliates for their reasonable, documented,
out-of-pocket costs and expenses incurred in connection therewith (provided that
no such reimbursement shall be required with respect to any liability or
obligation that is covered, directly or indirectly, by any of the preceding
subparagraphs (i) through (iv), inclusive). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Acquisition of the Membership Units and the
Shares</U>. Subject to the terms and conditions set forth herein,
(i)&#160;Seller hereby agrees to transfer to USA Purchaser, and USA Purchaser
hereby agrees to accept the transfer from Seller of, the Membership Units, free
and clear of any Encumbrance, except as provided in the Limited Liability
Company Agreement (the <B>"Membership Unit Acquisition"</B>), and (ii)&#160;DEI
hereby agrees to transfer to Canadian Purchaser, and Canadian Purchaser hereby
agrees to accept the transfer from DEI of, the Shares, free and clear of any
Encumbrance (the <B>"Share Acquisition"</B>). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Working Capital Adjustments</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing Date
Adjustment</U>. At least two (2) Business Days prior to the Closing Date, DEI
and Seller shall deliver to Buyer (i)&#160;the Closing Acquired Stores Schedule,
the Closing Disney Retained Stores Schedule and the Deferred Stores Schedule;
(ii)&#160;the estimated unaudited balance sheet of the Company on a combined
basis as of the Closing Date, prepared by the Company, DEI and Seller in good
faith, giving effect as of the Closing Date to the Pre-Closing Transactions (the
<B>"Closing Balance Sheet"</B>); and (iii)&#160;a letter setting forth
and certifying the Company's, DEI's and Seller's good faith
calculation, based on the Closing Balance Sheet, of the Estimated Closing
Working Capital and the Estimated Closing Working Capital Adjustment Amount. The
Closing Balance Sheet shall be prepared in a manner and form consistent with the
Pro Forma Balance Sheet (including the application of Modified GAAP), except for
adjustments made to reflect the absence of the Non-Transferable Stores, Expired
Lease Stores and the Deferred Stores in accordance with the Store Adjustment
Methodology, and the Estimated Closing Working Capital and the Estimated Closing
Working Capital Adjustment Amount shall be calculated in a manner and form
consistent with the June 2004 Working Capital Statement. Upon the Closing Date
(and, if Buyer makes the election provided for in Section 3.3.1, on or prior to
the Working Capital Deferred Delivery Date with respect to the Deferred Item
Amount only), the Estimated Closing Working Capital Adjustment Amount shall be
paid in accordance with Section&#160;3.2 or 3.3, as applicable; <U>provided</U>,
that if the Estimated Closing Working Capital Adjustment Amount is zero, there
shall be no such payment made pursuant to this Section&#160;2.3.1. If the
Estimated Closing Working Capital Adjustment Amount is positive, (A) the
<B>"Initial Canada Purchase Price"</B> shall be (x) the Estimated
Closing Working Capital Adjustment Amount multiplied by (y) a fraction, the
numerator of which is the number of Acquired Stores set forth on the Closing
Acquired Stores Schedule that were operated by TDS Canada prior to the Closing,
and the denominator of which is the total number of Acquired Stores set forth on
the Closing Acquired Stores Schedule, and (B) the <B>"Initial USA Purchase
Price"</B> shall be the Initial Purchase Price minus the Initial Canada Purchase
Price. If the Estimated Closing Working Capital Adjustment Amount is negative or
zero, the <B>"Initial Canada Purchase Price"</B> and the
<B>"Initial USA Purchase Price"</B> shall each be zero. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Post-Closing
Adjustment</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;<U>Buyer's Estimated Closing Balance Sheet and Subsequent Closing
Balance Sheet; Adjustment Statement</U>. Within six (6) months after the
Subsequent Closing Date or, if no Subsequent Closing occurs, within six (6)
months after the expiration of the Subsequent Closing Period (if applicable),
Buyer shall cause to be prepared and delivered to DEI and Seller (i) an
unaudited balance sheet of the Company on a combined basis as of the Closing
Date (<B>"Buyer's Estimated Closing Balance Sheet"</B>), (ii) Buyer's good faith
estimate of the Final Closing Working Capital Adjustment Amount based on Buyer's
Estimated Closing Balance Sheet (i.e., as if it were the Final Closing Balance
Sheet), (iii) an unaudited balance sheet reflecting the assets and liabilities
relating solely to the Approved Deferred Stores, including, without limitation,
the Approved Deferred Leases and Store-Related Assets and Liabilities, as of the
Subsequent Closing Date (<B>"Buyer's Estimated Subsequent Closing Balance
Sheet"</B>), (iv) Buyer's good faith estimate of the Final Subsequent Closing
Working Capital Adjustment Amount based on Buyer's Estimated Subsequent Closing
Balance Sheet (<U>i.e.</U>, as if it were the Final Subsequent Closing Balance
Sheet), and (v) appropriate supporting documentation for each of the foregoing
(collectively, the <B>"Adjustment Statement"</B>). Buyer's Estimated Closing
Balance Sheet and Buyer's Estimated Subsequent Closing Balance Sheet shall be
prepared in a manner and form consistent with the Closing Balance Sheet and
Subsequent Closing Balance Sheet, respectively, including the application of
Modified GAAP (and, for purposes of clarification, shall not include any
adjustment to inventory arising from any inventory valuation or inventory count
conducted by any party in connection therewith), and the Final Closing Working
Capital Adjustment Amount and the Final Subsequent Closing Working Capital
Adjustment Amount shall be calculated in a manner and form consistent with the
Estimated Closing Working Capital Adjustment Amount.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Adjustment Statement Objection</U>. During
the three (3) month period following Buyer's delivery of the Adjustment
Statement, DEI, Seller and their Representatives shall have, upon request during
normal business hours subject to reasonable prior notice, (x) the right to
examine the Adjustment Statement and all records and documentation used to
prepare the Adjustment Statement, (y) access to copies of all other books,
records and accounts and such other information relating to the Adjustment
Statement in the possession of Buyer, its Affiliates and/or their respective
accountants and other Representatives as DEI or Seller reasonably requests, and
(z) access to the employees, accountants and other Representatives of Buyer and
its Affiliates as DEI or Seller reasonably requests, to allow DEI and Seller to
examine the accuracy of the Adjustment Statement, including, without limitation,
any item on Buyer's Estimated Closing Balance Sheet or Buyer's Estimated
Subsequent Closing Balance Sheet and any item included in Buyer's good faith
estimate of the Final Closing Working Capital Adjustment Amount or the Final
Subsequent Closing Working Capital Adjustment Amount. In the event DEI or Seller
disputes any matter described in the Adjustment Statement, including any item on
Buyer's Estimated Closing Balance Sheet or Buyer's Estimated Subsequent Closing
Balance Sheet, DEI or Seller shall so inform Buyer in writing (the
<B>"Adjustment Statement Objection"</B>), setting forth a reasonably detailed
description of the basis of the Adjustment Statement Objection on or before the
last day of the three (3) month period referred to above in this Section
2.3.2(b). For purposes of clarification, DEI and Seller may examine the accuracy
of any matter described in the Adjustment Statement and submit the Adjustment
Statement Objection regardless of whether Buyer's estimated Final Closing
Working Capital Adjustment Amount or estimated Final Subsequent Closing Working
Capital Adjustment Amount set forth in the Adjustment Statement is positive,
negative or zero. If DEI or Seller delivers an Adjustment Statement Objection,
Buyer, DEI and Seller shall attempt in good faith to resolve such objection
within two (2) months following Buyer's receipt thereof. If DEI, Seller and
Buyer are unable to resolve the objection within such two (2) month period, they
shall refer their remaining differences to Grant Thornton LLP (the <B>"CPA
Firm"</B>), who shall, acting as experts in accounting and not as arbitrators or
legal experts, resolve only those accounting disagreements specifically
submitted to the CPA Firm. Buyer, DEI and Seller shall cooperate in good faith
to agree upon the specific accounting disagreements to be submitted to the CPA
Firm, the method for submitting such accounting disagreements, applicable
guidelines to govern communications with the CPA Firm and other procedural rules
with respect to the engagement of, the submission of accounting differences to,
and the resolution of such accounting differences by, the CPA Firm. In no event
shall Buyer, DEI or Seller submit to the CPA Firm, nor shall the CPA Firm
resolve, any legal disagreements. Buyer, DEI and Seller shall make readily
available to the CPA Firm all relevant books and records and any work papers
relating to the Adjustment Statement, the employees, accountants and other
Representatives of Buyer, DEI and Seller, and all other items reasonably
requested by the CPA Firm. Buyer, DEI and Seller shall jointly engage the CPA
Firm, and the fees and disbursements of the CPA Firm shall be shared equally by
Buyer, on the one hand, and DEI and Seller, on the other hand. The CPA Firm
shall be directed to deliver in writing its resolution of any disputed items
from the Adjustment Statement to DEI, Seller and Buyer no later than the
twentieth (20th) Business Day after the remaining differences underlying the
Adjustment Statement Objection are referred to the CPA Firm. Upon completion of
the foregoing procedures:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;the <B>"Final Closing Balance Sheet"</B> and the <B>"Final
Subsequent Closing Balance Sheet"</B> shall be deemed to be (A) as set forth in
the Adjustment Statement, if DEI and Seller do not object thereto within the
specified time period, (B) as agreed upon by DEI, Seller and Buyer, if DEI or
Seller objects to the Adjustment Statement but DEI, Seller and Buyer are able to
resolve such objection, (C) as determined or resolved by the CPA Firm, if DEI or
Seller objects to the Adjustment Statement and Buyer, DEI and Seller are unable
to resolve all such objections, or (D) as applicable, a combination of the
preceding subparagraphs (B) and (C); and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii)&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;the <B>"Final Working Capital Adjustment
Amount"</B> shall be either (A) the Combined Working Capital Adjustment Amount
<U>minus</U> the Adjustment Threshold, if such Combined Working Capital Adjustment
Amount is greater than the Estimated Closing Working Capital Adjustment Amount
paid at the Closing pursuant to Section 3.2 or 3.3, as applicable (and the
Deferred Item Amount paid on or prior to the Working Capital Deferred Delivery
Date, if applicable), by an amount in excess of the Adjustment Threshold, (B)
the Combined Working Capital Adjustment Amount <U>plus</U> the Adjustment
Threshold, if such Combined Working Capital Adjustment Amount is less than the
Estimated Closing Working Capital Adjustment Amount paid at the Closing pursuant
to Section 3.2 or 3.3, as applicable (and the Deferred Item Amount paid on or
prior to the Working Capital Deferred Delivery Date, if applicable), by an
amount in excess of the Adjustment Threshold, or (C) the Estimated Closing
Working Capital Adjustment Amount, if the Combined Working Capital Adjustment
Amount is not greater than or less than the Estimated Closing Working Capital
Adjustment Amount paid at the Closing pursuant to Section 3.2 or 3.3, as
applicable (and the Deferred Item Amount paid on or prior to the Working Capital
Deferred Delivery Date, if applicable), by an amount in excess of the Adjustment
Threshold.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>Final Payments</U>. Within three (3) Business Days
following completion of the foregoing procedures, (i) if the Final Working
Capital Adjustment Amount is equal to the amount calculated under subparagraph
(A) of Section 2.3.2(b)(ii), USA Purchaser shall pay to Seller the Post-Closing
Adjustment Amount (less any amount withheld pursuant to Section 3.5.1, which
amount shall be delivered to the Escrow Agent pursuant to Section 3.5.1) by wire
transfer of immediately available funds pursuant to wire instructions delivered
by Seller to USA Purchaser (and (x) Canadian Purchaser shall be responsible for
reimbursing USA Purchaser for its allocable portion thereof and (y) Seller shall
be responsible for paying DEI and Canadian Transferee their respective allocable
portions thereof), (ii) if the Final Working Capital Adjustment Amount is equal
to the amount calculated under subparagraph (B) of Section 2.3.2(b)(ii), Seller
shall pay to USA Purchaser the Post-Closing Adjustment Amount by wire transfer
of immediately available funds pursuant to wire instructions delivered by USA
Purchaser to Seller (and (x) DEI and Canadian Transferee shall be responsible
for reimbursing Seller for their respective allocable portions thereof and (y)
USA Purchaser shall be responsible for paying Canadian Purchaser its allocable
portion thereof), or (iii) if the Final Working Capital Adjustment Amount is
equal to the Estimated Closing Working Capital Adjustment Amount paid at the
Closing (and the Deferred Item Amount paid on or prior to the Working Capital
Deferred Delivery Date, if applicable), there shall be no further payment
pursuant to this Section 2.3.2(c).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Final Canada Purchase Price and Final USA
Purchase Price</U>. If the sum of the Estimated Closing Working Capital
Adjustment Amount plus the Post-Closing Adjustment Amount is positive, (i) the
<B>"Final Canada Purchase Price"</B> shall be (A) the Final Working Capital
Adjustment Amount multiplied by (B) a fraction, the numerator of which is the
number of Acquired Stores set forth on the Closing Acquired Stores Schedule plus
the number of Approved Deferred Stores set forth on the Approved Deferred Stores
Schedule, in each case which Acquired Stores and Approved Deferred Stores were
operated by TDS Canada prior to the Closing, and the denominator of which is the
total number of Acquired Stores set forth on the Closing Acquired Stores
Schedule plus the total number of Approved Deferred Stores set forth on the
Approved Deferred Stores Schedule, and (ii) the <B>"Final USA Purchase
Price"</B> shall be the Final Working Capital Adjustment Amount minus the Final
Canada Purchase Price. If the sum of the Estimated Closing Working Capital
Adjustment Amount plus the Post-Closing Adjustment Amount is negative or zero,
the <B>"Final Canada Purchase Price"</B> and the <B>"Final USA Purchase
Price"</B> shall each be zero.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Allocation of the Tax Purchase Price to
Assets</U>. For United States Tax purposes, the Tax Purchase Price, if any,
shall be allocated among the assets of TDS USA in accordance with Section 1060
of the Code as agreed upon by Buyer, DEI and Seller. A draft allocation schedule
(the <B>"Initial Allocation Schedule"</B>), setting forth the Tax Purchase Price
and the allocation of such Tax Purchase Price among the assets of TDS USA shall
be provided by Buyer to DEI and Seller within two (2) months after the Closing
Date. The Initial Allocation Schedule shall be finalized only after review and
mutual approval in writing thereof by Buyer, DEI and Seller. The approved
Initial Allocation Schedule shall be used by Buyer, DEI and Seller for federal,
state, local and other tax purposes. If Buyer, DEI and Seller are unable to
agree on the amount of the Tax Purchase Price and/or to finalize the allocation
of the Tax Purchase Price among the assets of TDS USA within two (2) months
after the Initial Allocation Schedule is provided by Buyer to DEI and Seller,
then Buyer, DEI and Seller shall promptly appoint the CPA Firm to resolve any
disagreements regarding the amount of the Tax Purchase Price and/or any
outstanding allocation issues in accordance with Section 1060 of the Code. The
decision of the CPA Firm with respect to such outstanding issues shall be final
and binding on Buyer, DEI, Seller and the Company. The fees and disbursements of
the CPA Firm shall be shared equally by Buyer, on the one hand, and DEI and
Seller, on the other hand. Buyer shall also provide an updated allocation
schedule (the <B>"Final Allocation Schedule"</B>) to DEI and Seller within two
(2) months after the Final Closing Balance Sheet is determined to account for
any changes in the Tax Purchase Price or the assets acquired by Buyer after the
date on which the Initial Allocation Schedule is delivered. The Final Allocation
Schedule shall be subject to the same review and resolution procedures as are
applicable to the Initial Allocation Schedule, limited, however, to the effects
of any adjustments to the Tax Purchase Price or the assets set forth or required
to be set forth on the Final Allocation Schedule. Each party will comply, and
Buyer will cause the Company to comply, with the filing requirements of Section
1060 of the Code and other applicable regulations and will provide to the other
party a pre-filing copy of such filings. DEI and Seller shall provide Buyer with
such information as may be reasonably requested by Buyer that is necessary for
purposes of calculating the Tax Purchase Price and that is in the possession of
DEI and Seller or that is otherwise readily available to DEI and Seller without
any additional diligence or expenditure of money by DEI, Seller or any of their
Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>338 Election</U>. Buyer hereby acknowledges
and agrees that it shall not make any election under Section&#160;338 of the
Code (or any corresponding elections under state or local Tax Laws) in
connection with the Share Acquisition. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Post-Closing Transactions</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The parties
acknowledge that TDS USA shall be merged into New TDS LLC, with New TDS LLC
being the surviving company in the merger (the <B>"TDS USA Merger"</B>), on or
within twenty (20) Business Days following the Closing Date. At least ten (10)
Business Days prior to the filing thereof with any Governmental Entity, Buyer
shall provide DEI with complete and accurate copies of all documents and
instruments to be used and/or filed in connection with the TDS USA Merger. Buyer
shall in good faith consider all comments made by DEI with respect to such
documents and instruments and shall incorporate all comments that DEI reasonably
requests. Buyer shall ensure that none of the documents or instruments to be
used and/or filed in connection with the TDS USA Merger shall conflict with,
violate or breach any provision of this Agreement, the License and Conduct of
Business Agreement or any other Related Agreement. Notwithstanding anything to
the contrary contained in this Section 2.6, neither DEI, Seller nor their
Affiliates shall have any responsibility for, or any liability in connection
with, the TDS USA Merger or any documents or instruments related thereto.
Following the TDS USA Merger, references in this Agreement (or in any Contract
executed pursuant hereto or in connection with the transactions contemplated
hereby) to "TDS USA" (including, without limitation, references to the "Company"
that include TDS USA) shall be deemed to be references to "New TDS LLC," as the
survivor of the TDS USA Merger. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The parties
acknowledge that Buyer shall be required to cause TDS Canada to be continued
under the laws of the province of New Brunswick, Canada and amalgamated with New
TDS Canada, with New TDS Canada being the survivor in the amalgamation (the
<B>"Canada Reincorporation"</B>) on or within twenty (20) Business
Days following the Closing Date (except that such date may be extended if and
only to the extent that any action taken, or failed to be taken, in error by DEI
or its Affiliates on or prior to the Closing renders it impossible to effect
such continuation and amalgamation within such twenty (20) Business-Day period,
in which event, if applicable, Buyer and the Company shall be obligated to
correct any such error and effect such continuation and amalgamation as soon as
reasonably practicable thereafter, <U>provided</U>, that DEI shall reimburse
Buyer and/or its Affiliates, as applicable, for reasonable, out-of-pocket
documented costs incurred by them in connection with the correction of any such
error(s)). The date on which the Canada Reincorporation is effected is referred
to herein as the <B>"Canada Reincorporation Date."</B> At least ten (10)
Business Days prior to the filing thereof with any Governmental Entity, Buyer
shall provide DEI with complete and accurate copies of all documents and
instruments to be used and/or filed in connection with the Canada
Reincorporation. Buyer shall in good faith consider all comments made by DEI
with respect to such documents and instruments and shall incorporate all
comments that DEI reasonably requests. Buyer shall ensure that none of the
documents or instruments to be used and/or filed in connection with the Canada
Reincorporation shall conflict with, violate or breach any provision of this
Agreement, the License and Conduct of Business Agreement or any other Related
Agreement. Notwithstanding anything to the contrary contained in this Section
2.6, neither DEI, Seller nor their Affiliates shall have any responsibility for,
or any liability in connection with, the Canada Reincorporation or any documents
or instruments related thereto. Following the Canada Reincorporation, references
in this Agreement (or in any Contract executed pursuant hereto or in connection
with the transactions contemplated hereby) to "TDS Canada" (including, without
limitation, references to the "Company" that include TDS Canada) shall be deemed
to be references to the New Brunswick corporation that is the successor by
continuance and amalgamation to TDS Canada. </FONT></P>

<P ALIGN=CENTER><B>ARTICLE III<BR>
CLOSING</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing; No Change in Terms</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;Unless this Agreement is earlier terminated under Article IX,
the closing of the Membership Unit Acquisition and the Share Acquisition (the
<B>"Closing"</B>) will take place on the date that is five (5) Business Days
following satisfaction or waiver of the conditions set forth in Article VIII, at
the offices of Irell &amp; Manella LLP, 1800 Avenue of the Stars, Suite 900, Los
Angeles, California, unless another place or time is agreed to by DEI, Seller
and Buyer.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Notwithstanding the foregoing, if, as of the date that the Closing would
otherwise have occurred pursuant to Section 3.1.1(a), the Buyer Working Capital
Amount (without taking into account the proviso contained in the definition of
"Buyer Working Capital Amount," and based on the Estimated Closing Working
Capital Adjustment Amount reported to Buyer by DEI and Seller pursuant to
Section 2.3) exceeds Fifty Million Dollars ($50,000,000), and such excess amount
(the <B>"Excess Amount"</B>) is not available for borrowing under the Wells
Fargo Credit Facility as of such date, then Buyer, in its sole discretion, shall
be entitled to postpone the Closing to a date that is up to, but not later than,
the earlier of (i) the fifteenth (15th) Business Day following the date on which
the Closing would otherwise have occurred pursuant to Section 3.3.1(a) and (ii)
February 15, 2005. In such event, Buyer: (i) shall provide DEI and Seller with
written notice of its election to postpone the Closing pursuant to this Section
3.1.1(b) on the earlier of (A) the date on which Buyer determines that the
Excess Amount is not available for borrowing under the Wells Fargo Credit
Facility as of the date on which the Closing otherwise would have occurred
pursuant to Section 3.1.1(a) and (B) the date that is one (1) Business Day after
DEI and Seller deliver to Buyer the Estimated Closing Working Capital Adjustment
Amount pursuant to Section 2.3; and (ii) shall provide DEI and Seller with at
least five (5) Business Days' prior written notice of the date, as postponed
pursuant to this Section 3.1.1(b), on which the Closing shall occur. For
purposes of clarification, Buyer shall only be entitled to one (1) postponement
of the Closing Date pursuant to this Section 3.1.1(b), and such postponement
shall not in any manner relieve Buyer of its obligations to close the Membership
Unit Acquisition and the Share Acquisition in accordance with this Agreement on
the date to which the Closing is postponed pursuant to this Section 3.1.1(b).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3.1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Change in Terms</U>. The parties agree
and acknowledge that none of the material terms or conditions of the
transactions contemplated by this Agreement, including, without limitation,
those contemplated by the Related Agreements and the TCP Guaranty and Commitment
and any financial terms or conditions contained therein, shall be modified based
on, or as a result of, the date on which the Closing occurs. Without limiting
the generality of the foregoing and by way of example only, Buyer shall not be
compensated for the fact that it may not be able to operate the Business during
all or any portion of the 2004 holiday season. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing Deliveries by DEI and Seller</U>. At
the Closing, DEI and/or Seller, as applicable, shall deliver or cause to be
delivered to USA Purchaser and/or Canadian Purchaser, as applicable: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The certificate
representing the Membership Units duly endorsed by Seller or accompanied by an
Assignment Separate from Certificate in substantially the form attached hereto
as <U>Annex D-1
</U>Transferring the Membership Units; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The certificate
representing the Shares duly endorsed by DEI or accompanied by an Assignment
Separate from Certificate in substantially the form attached hereto as <U>Annex
D-2</U> Transferring the Shares; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A properly
executed statement in a form reasonably acceptable to Buyer satisfying the
requirements of Treasury Regulation Section&#160;1.1445-2(b)(2); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the
Estimated Closing Working Capital Adjustment Amount is negative, the Estimated
Closing Working Capital Adjustment Amount, via wire transfer of immediately
available funds to such account of USA Purchaser as shall have been designated
in writing by USA Purchaser to Seller prior to the Closing (and (i) DEI shall be
responsible for reimbursing Seller for its allocable portion thereof and (ii)
USA Purchaser shall be responsible for paying Canadian Purchaser its allocable
portion thereof); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The agreements,
opinions, certificates and instruments referred to in Section 8.2
hereof;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company Minute
Books (including charters, bylaws and other comparable organizational
documents); and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The stock (or
share) ledgers and other equity ownership records of TDS USA and TDS
Canada.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing Deliveries by Buyer</U>. At the
Closing (or, as set forth below with respect to the Deferred Item Amount, on or
prior to the Working Capital Deferred Delivery Date):</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the
Estimated Closing Working Capital Adjustment Amount is positive, USA Purchaser
shall pay the Estimated Closing Working Capital Adjustment Amount (less any
amount withheld pursuant to Section&#160;3.5.1, which amount shall be delivered
to the Escrow Agent pursuant to Section&#160;3.5.1), via wire transfer of
immediately available funds to such account of Seller as shall have been
designated in writing by Seller to USA Purchaser prior to the Closing (and (i)
Canadian Purchaser shall be responsible for reimbursing USA Purchaser for its
allocable portion thereof and (ii) Seller shall be responsible for paying DEI
its allocable portion thereof); <U>provided</U>, <U>that</U>, (A) if and only if
the Closing Date occurs on or prior to November 30, 2004, a portion of the Buyer
Working Capital Amount that is equal to the Deferred Item Amount and that is
otherwise required to be delivered to Seller at the Closing may, at USA
Purchaser's election, instead be delivered to Seller on or prior to the Working
Capital Deferred Delivery Date via wire transfer of immediately available funds
to such account of Seller as shall have been designated in writing by Seller to
USA Purchaser prior to the Working Capital Deferred Delivery Date,
<U>provided</U>, <U>that</U>, in such event, USA Purchaser shall pay Seller
interest on the Deferred Item Amount from the Closing Date until the date of
payment thereof at the per annum rate set forth in Section 11.13 (and Canadian
Purchaser shall be responsible for reimbursing USA Purchaser for its allocable
portion thereof); for purposes of clarification, Buyer acknowledges and agrees
that this subparagraph (A) of this Section 3.3.1 shall be inapplicable and no
payment of any portion of the Buyer Working Capital Amount may be deferred
pursuant to this subparagraph (A) of this Section 3.3.1 if the Closing Date
occurs after November 30, 2004; and (B) up to an aggregate of Forty Million
Dollars ($40,000,000) of the Estimated Closing Working Capital Adjustment Amount
in excess of the Buyer Initial Working Capital Portion required to be delivered
to Seller at the Closing pursuant to this Section 3.3.1 may, at the election of
USA Purchaser, be delivered on the Closing Date to Seller by the Company (rather
than USA Purchaser), as a Subsidiary of Buyer, via wire transfer of immediately
available funds to such account of Seller as shall have been designated in
writing by Seller to USA Purchaser prior to the Closing, from proceeds of
borrowings under the Company Credit Facility, if such facility is established
and borrowings are available thereunder on the Closing Date; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;USA Purchaser
and/or Canadian Purchaser, as applicable, shall deliver or cause to be delivered
to DEI and/or Seller, as applicable, the agreements, opinions, certificates and
instruments referred to in Section 8.3 hereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Resignation of Officers and Directors</U>.
Effective as of the Closing Date, DEI and/or Seller shall cause the officers,
directors and/or managers of the Company who are not Continuing Employees to
resign and, if applicable, Buyer shall cause new officers, directors and/or
managers of the Company to be appointed, all in accordance with applicable Law
and the governing documents of the Company. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section 116 Requirements</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If available on
or before the Closing Date, a certificate issued by the Canada Customs and
Revenue Agency (<B>"CCRA"</B>) pursuant to section&#160;116 of the Income Tax
Act (Canada) in connection with the disposition of the Shares to Canadian
Purchaser (a <B>"Section&#160;116 Certificate"</B>) shall be provided by DEI to
Buyer on the Closing Date. Any required withholding from the Initial Purchase
Price shall be determined as follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;If the Section 116 Certificate has a certificate limit equal
to or greater than the Initial Canada Purchase Price (an <B>"Acceptable TDS
Canada Section 116 Certificate"</B>), no amount may be withheld from the Initial
Purchase Price;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;If the Section 116 Certificate has a certificate limit that is
less than the Initial Canada Purchase Price (a <B>"Partial TDS Canada Section 116
Certificate"</B>), Buyer shall withhold from the Initial Purchase Price an amount
equal to twenty-five percent (25%) of the difference between the Initial Canada
Purchase Price and the certificate limit (a <B>"TDS Canada Withheld Amount"</B>); or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;If neither an Acceptable TDS Canada Section 116 Certificate
nor a Partial TDS Canada Section 116 Certificate is delivered to Buyer on the
Closing Date, Buyer shall withhold from the Initial Purchase Price an amount
equal to twenty-five percent (25%) of the Initial Canada Purchase Price (also a
<B>"TDS Canada Withheld Amount"</B>).</FONT></P>

<P><FONT SIZE=3>Any amounts withheld pursuant to Sections&#160;3.5.1(b) or
3.5.1(c) shall forthwith be converted at the then-prevailing exchange rate to
Canadian dollars and paid by Buyer to the Escrow Agent to be held by the Escrow
Agent pursuant to the terms of this Agreement and an escrow agreement on terms
consistent herewith that are mutually agreed upon by DEI, Seller, Buyer and the
Escrow Agent. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If Buyer
withholds a TDS Canada Withheld Amount pursuant to Section&#160;3.5.1, the
Escrow Agent shall invest, on behalf of DEI, the TDS Canada Withheld Amount in
one or more investments the interest on which is not subject to Canadian
withholding tax under Part XIII of the Income Tax Act (Canada) from the Closing
Date until the earlier of the date on which the TDS Canada Withheld Amount (or a
portion thereof) is delivered to DEI or remitted to CCRA. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If, on or
before the twenty-eighth (28th) day following the end of the month in which the
Closing Date occurs (the <B>"Remittance Date"</B>): </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;DEI provides Buyer and the Escrow Agent with a copy of a
letter from CCRA confirming receipt of a section 116 application and advising
that CCRA will not enforce the remittance of funds as required by subsection
116(5) of the Income Tax Act (Canada) (<B>"CCRA Letter"</B>) in relation to the
disposition of the Shares, the escrow shall continue;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;DEI provides Buyer and the Escrow Agent with an Acceptable TDS
Canada Section 116 Certificate, the Escrow Agent shall release the TDS Canada
Withheld Amount to DEI with all interest accrued thereon to the date of such
delivery; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEI provides Buyer and the Escrow Agent with a
Partial TDS Canada Section 116 Certificate, the Escrow Agent shall remit to CCRA
a portion of the TDS Canada Withheld Amount equal to twenty-five percent (25%)
of the excess of the Initial Canada Purchase Price over the certificate limit in
the Partial TDS Canada Section 116 Certificate and shall release the remaining
portion of the TDS Canada Withheld Amount to DEI with all accrued interest on
the TDS Canada Withheld Amount to the date of such delivery.</FONT></P>

<P><FONT SIZE=3>In the absence of a CCRA Letter or a Section&#160;116
Certificate being delivered as described in Sections&#160;3.5.3(a), 3.5.3(b) or
3.5.3(c), the Escrow Agent shall remit the TDS Canada Withheld Amount to CCRA
and pay all accrued interest to the date of the remittance on the TDS Canada
Withheld Amount to DEI. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event
the escrow continues past the Remittance Date in accordance with
Section&#160;3.5.3(a), the TDS Canada Withheld Amount shall be released or
remitted as follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If DEI provides Buyer and the Escrow Agent with
an Acceptable TDS Canada Section 116 Certificate, the Escrow Agent shall release
the TDS Canada Withheld Amount to DEI with all interest accrued thereon to the
date of such delivery;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If DEI provides Buyer and the Escrow Agent with
a Partial TDS Canada Section 116 Certificate, the Escrow Agent shall remit to
CCRA a portion of the TDS Canada Withheld Amount equal to twenty-five percent
(25%) of the excess of the Initial Canada Purchase Price over the certificate
limit in the Partial TDS Canada Section 116 Certificate and shall release the
remaining portion of the TDS Canada Withheld Amount to DEI with all accrued
interest on the TDS Canada Withheld Amount to the date of such delivery; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If, prior to receiving a Section 116
Certificate described in Section 3.5.4(a) or 3.5.4(b), CCRA notifies the Escrow
Agent or a party that it is rescinding or revoking the CCRA Letter, the Escrow
Agent shall remit the TDS Canada Withheld Amount to CCRA and pay all accrued
interest on the TDS Canada Withheld Amount to the date of the remittance to DEI.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Where any
amount is remitted to CCRA pursuant to this Section 3.5, the Escrow Agent shall
furnish DEI with confirmation from CCRA that such remittance has been made and
any such remittance shall be deemed to have been paid by Buyer to DEI on account
of the Initial Canada Purchase Price. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The provisions
of Sections&#160;3.5.1 to 3.5.5 shall apply <I>mutatis mutandis</I> to the Final
Canada Purchase Price, and references to the "Closing Date" for this purpose
shall be deemed to be references to the date on which any final payment is made
pursuant to Section 2.3.2(c) and references to the "Initial Canada Purchase
Price" for this purpose shall be deemed to be references to the "Final Canada
Purchase Price." For purposes of clarification, the parties acknowledge that it
is DEI's and Seller's intent to apply initially for only one Section&#160;116
Certificate with respect to all of the transactions contemplated by this
Agreement (including the Subsequent Closing and any adjustment resulting in the
Final Canada Purchase Price), unless, as determined by DEI or Seller in its
respective sole discretion, one or more additional Section&#160;116 Certificates
may be required, in which case DEI or Seller shall be entitled to apply for such
additional certificates in its respective sole discretion. </FONT></P>

<P ALIGN=CENTER><B>ARTICLE IV<BR>
REPRESENTATIONS AND WARRANTIES OF DEI AND SELLER</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Except as disclosed on the TDS Schedules, which have been separately delivered
by DEI and Seller to Buyer concurrently with the execution of this Agreement,
each of DEI and Seller, jointly and severally, represents and warrants to Buyer
as follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;4.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Organization; Capitalization</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Incorporation
and Authority of DEI</U>. DEI is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware. DEI has
the requisite power and authority to execute and deliver this Agreement and the
documents and instruments contemplated hereby and to perform and comply with all
of the terms, conditions and covenants to be performed and complied with by it
hereunder and thereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Incorporation
and Authority of Seller</U>. Seller is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of California. Seller
has the requisite power and authority to execute and deliver this Agreement and
the documents and instruments contemplated hereby and to perform and comply with
all of the terms, conditions and covenants to be performed and complied with by
it hereunder and thereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Incorporation
and Authority of the Company; Governing Documents</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TDS USA is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
California. TDS Canada is a corporation duly organized and validly existing
under the laws of the Province of Ontario. Each of TDS USA and TDS Canada has
the requisite power and authority to own its properties and assets and carry on
the Business as currently conducted.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;DEI and Seller have heretofore delivered to Buyer true and
complete copies of (i) the charter documents (articles or certificate of
incorporation or other), bylaws, limited liability company agreements, operating
agreements and securityholders agreements of the Company as in effect on the
date hereof and (ii) other governing documents or Contracts pertaining to the
management or operation of the Company or the ownership of any Securities
thereof (collectively, <B>"Company's Governing Documents"</B>). There have been no
amendments, restatements or modifications to Company's Governing Documents not
delivered to Buyer.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Capitalization
of TDS USA</U>. One Hundred (100) units of membership interest of TDS USA are
issued and outstanding, all of which are legally and beneficially owned solely
by Seller free and clear of all Encumbrances, except as provided in the Limited
Liability Company Agreement. There are no outstanding options, warrants, rights
or other Securities of TDS USA convertible into, or exercisable for, Securities
of TDS USA. At the Closing, Seller will Transfer the Membership Units
representing all outstanding membership interests in TDS USA to Buyer free and
clear of all Encumbrances, except as provided in the Limited Liability Company
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Capitalization
of TDS Canada</U>. The authorized share capital of TDS Canada consists of an
unlimited number of common shares (without par value), of which Five Million
Three Hundred Thousand Eight (5,300,008) common shares are outstanding. The
Shares have been duly authorized and validly issued, are fully paid and
non-assessable, and are legally and beneficially owned solely by DEI free and
clear of all Encumbrances. There are no outstanding options, warrants, rights or
other Securities of TDS Canada convertible into, or exercisable for, Securities
of TDS Canada. At the Closing, DEI will Transfer the Shares to Buyer free and
clear of all Encumbrances. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <U>Tax
Classification of TDS USA</U>. For United States income tax purposes, on and
immediately prior to the Closing Date TDS USA will be classified as an entity
that is disregarded as an entity separate from its owner. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsidiaries</U>.
Except as set forth on <U>TDS Schedule 4.1.7</U>, the Company has no
Subsidiaries nor any equity interests in any other Person. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Financial Statements; Indebtedness; Liabilities
or Contingencies</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.1 <U>Financial Statements</U>. <U>TDS Schedule
4.2.1</U> contains (a)&#160;the unaudited combined balance sheet and statement
of operations of the Company as of and for the twelve (12) months ended
September 27, 2003 and as of and for the nine (9) months ended June 26, 2004
(collectively, the <B>"Combined Actual Financial Statements"</B>), (b) the pro
forma unaudited combined balance sheet of the Company as of June 26, 2004,
giving effect as of such date to the Pre-Closing Transactions (the <B>"Pro Forma
Balance Sheet"</B> and, together with the Combined Actual Financial Statements,
the <B>"Financial Statements"</B>) and (c) the June 2004 Working Capital
Statement. For the avoidance of doubt, the Financial Statements shall not be
deemed to include the Trial Balance or the June 2004 Working Capital Statement,
even though the Trial Balance and the June 2004 Working Capital Statement may be
included in <U>TDS Schedule 4.2.1</U>, and no representation or warranty
whatsoever with respect to the Trial Balance or the June 2004 Working Capital
Statement is made or deemed to be made hereby. The Financial Statements have
been prepared in all material respects in conformity with Modified GAAP. The
Financial Statements fairly present the financial condition and results of
operations of the Company as of and for the periods ending on the respective
dates thereof (subject, in the case of pro forma presentations, to the
transactions assumed therein). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Indebtedness; Liabilities or Contingencies</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>TDS Schedule 4.2.2</U> identifies the amount and creditor
of each item of Indebtedness of TDS USA or TDS Canada reflected on the Pro Forma
Balance Sheet to the extent such item of Indebtedness exceeds $100,000 in
principal amount of Indebtedness, but excluding the U.K. Lease
Guarantees.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;As of the Closing Date, TDS USA and TDS Canada shall not owe
any Indebtedness to DEI or any of its Affiliates (other than TDS USA or TDS
Canada) of a type that has been, in accordance with past business practice,
categorized as an "intercompany payable" on the balance sheets for TDS USA
and/or TDS Canada.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To the Knowledge of DEI and Seller, the
Business does not have any material liabilities of a nature that are required to
be disclosed in accordance with Modified GAAP, except (i) liabilities that are
reflected or disclosed on the Pro Forma Balance Sheet, including any contingent
liabilities reflected thereon and any liabilities reflected in any notes
thereto, (ii) liabilities that were incurred after the Balance Sheet Date in the
ordinary course of business consistent with past practice or in accordance with
Section 6.3, (iii) liabilities to be incurred after the Balance Sheet Date under
Contracts listed on <U>TDS Schedule 4.5</U>, Leases, Company Plans, Disney
Plans, this Agreement or the Related Agreements, (iv) liabilities for which DEI
and Seller are providing indemnification to Buyer and its Affiliates pursuant to
Section 10.2.1, 10.2.2 or 10.2.3 and (v) liabilities that are set forth on
<U>TDS Schedule 4.2.2</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Accounting Records and Accounting Controls;
Minute Books</U>. The Company maintains books and records that accurately
reflect in all material respects the transactions relating to the Business and
accounting controls sufficient to ensure that such transactions are executed in
accordance with management's general or specific authorization and recorded in
conformity with Modified GAAP, including, without limitation, with respect to
the periods for which the Financial Statements were being prepared. Such books
and records are true and complete in all material respects. The original minute
books of TDS USA and TDS Canada (including those with respect to each
predecessor entity) made available to Buyer for review (collectively, the
<B>"Company Minute Books"</B>) contain records that are true and complete in all
material respects of all meetings held of, and corporate or limited liability
company action taken by, the member, the shareholder, the board of directors (or
comparable governing body) and committees of the board of directors (or
comparable governing body) of TDS USA and TDS Canada (including each predecessor
entity). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Tax and Other Returns and Reports</U>. All
material Tax Returns required to be filed by or with respect to the Company or
its income, operations or assets have been filed. All such Tax Returns were
correct and complete in all material respects. All material Taxes due and
payable by or with respect to the Company or its income, operations or assets
(whether or not shown or required to be shown on any Tax Return) have been paid
other than Taxes being contested in good faith and disclosed on <U>TDS Schedule
4.4</U>. All material Taxes required to have been withheld and paid by or with
respect to the Company or its operations have been withheld and paid and all
material forms required with respect thereto, including, without limitation, IRS
Forms W-2 and 1099 and Canadian Forms NR-4 and NR-4 Summary, have been properly
completed and filed. DEI, Seller and Buyer agree to utilize, or cause their
respective Affiliates to utilize, the standard procedure set forth in Revenue
Procedure 96-60 with respect to wage reporting. Adequate provision in accordance
with Modified GAAP has been made in the books and records of the Company and in
the Pro Forma Balance Sheet for all material Taxes required to be paid or
withheld (but not yet paid or withheld) by the Company. Except as set forth on
<U>TDS Schedule 4.4</U>, none of DEI, Seller or the Company is in the process of
being examined by any Governmental Entity with respect to any Tax Returns of or
relating to the Company or its income, operations or assets (other than the
issuance of original notices of assessment to TDS Canada by Canadian revenue
authorities). Except as set forth on <U>TDS Schedule 4.4</U>, no Governmental
Entity has proposed, asserted or assessed, in each case in writing, any
deficiency, assessment or claim for Taxes of or relating to the Company or its
income, operations or assets that remain unpaid and that, individually or in the
aggregate, would constitute a Material Adverse Event. Except as set forth on
<U>TDS Schedule 4.4</U>, none of DEI, Seller or the Company has waived any
statute of limitations in respect of Taxes of or relating to the Company or its
income, operations or assets or agreed to any extension of time with respect to
any assessment or deficiency relating to Taxes of or with respect to the Company
or its income, operations or assets. Except as set forth on <U>TDS Schedule
4.4</U>, there are no liens on any of the assets of the Company that arose in
connection with any failure (or alleged failure) to pay any Tax. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Contracts</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Contracts;
No Breach or Default</U>. The Material Contracts and the Employment Contracts
(other than Contracts identified on <U>TDS Schedule 1.1(d)</U> as Retained
Assets) existing as of the date hereof are listed on <U>TDS Schedule 4.5</U>,
and true copies of the Material Contracts and the Employment Contracts,
including all amendments and supplements thereto, have been made available to
Buyer. Except as set forth on <U>TDS Schedule 4.5.1</U>: (i)&#160;each Material
Contract and Employment Contract is in effect to the extent of its terms as of
the date hereof and will be in effect to the extent of its terms as of the
Closing Date, except for those Material Contracts and Employment Contracts that
expire pursuant to their terms or are terminated other than in violation of
Section 6.3, 7.4.1(ii) or 7.4.4 prior to the Closing Date; and (ii)&#160;neither
the Company nor its Affiliates have Knowledge of, or have received written
notice declaring, a breach or default by TDS USA or TDS Canada thereunder which
breach or default remains uncured beyond the applicable cure period set forth
therein, and, to the Knowledge of DEI and Seller, no breach or default by any
other party or obligor with respect thereto has occurred thereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No
Termination or Modification</U>. Provided that the Consents and Permits listed
on <U>TDS Schedule 4.8.2</U> are obtained prior to Closing, the consummation of
the Membership Unit Acquisition, the Share Acquisition and the other
transactions contemplated by this Agreement and any other agreements and
instruments to be executed and delivered by DEI, Seller and/or any of their
Affiliates in connection herewith will not constitute a breach or violation in
any material respect of or a default in any material respect under, and will not
(and will not give any Person a right to) terminate or modify in any material
respect any rights of, or accelerate or otherwise affect in any material respect
any obligation of, TDS USA or TDS Canada under, any Material Contract or
Employment Contract. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Authorization
and Enforceability</U>. Except as set forth on <U>TDS Schedule 4.5.3</U>, each
Material Contract and Employment Contract: (i)&#160;has been duly authorized,
executed and delivered by TDS USA or TDS Canada, as applicable, and, to the
Knowledge of DEI and Seller, the other parties thereto, (ii)&#160;remains in
full force and effect to the extent of its terms without amendments or
modifications not reflected on <U>TDS Schedule 4.5</U> and made available to
Buyer; and (iii)&#160;is binding on TDS USA or TDS Canada, as applicable, and,
to the Knowledge of DEI and Seller, the other parties thereto in accordance with
its terms and applicable Laws, subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws and legal and equitable
principles affecting, limiting or relating to creditors rights generally, and
general principles of equity, including unconscionability, reasonableness and
good faith and fair dealing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;4.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Leases and Personal Property</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6.1&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>Leases</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Acquired Leases; No Breach or Default</U>.
True copies of the Acquired Leases, including all amendments and supplements
thereto, have been made available to Buyer, and a list thereof is set forth on
<U>TDS Schedule 4.6.1</U>. Except as set forth on <U>TDS Schedule 4.6.1</U>: (i)
each Acquired Lease is in effect to the extent of its terms as of the date
hereof and will be in effect to the extent of its terms as of the Closing Date,
except for those Acquired Leases that expire pursuant to their terms or are
terminated other than in violation of Section 6.3 or 6.7 prior to the Closing
Date; and (ii) neither the Company nor its Affiliates have Knowledge of, or have
received written notice declaring, a breach or default by TDS USA or TDS Canada
under any Acquired Lease, which breach or default remains uncured beyond the
applicable cure period set forth in the applicable Acquired Lease, and, to the
Knowledge of DEI and Seller, no breach or default by any other party or obligor
with respect to any Acquired Lease (including the Landlord thereunder) has
occurred thereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Termination or Modification</U>. Provided that
the Consents and Permits listed on <U>TDS Schedule 4.8.2</U> are obtained prior to
Closing, the consummation of the Membership Unit Acquisition, the Share
Acquisition and the other transactions contemplated by this Agreement and any
other agreements and instruments to be executed and delivered by DEI, Seller
and/or any of their Affiliates in connection herewith will not constitute a
breach or violation in any material respect of or a default in any material
respect under, and will not (and will not give any Person a right to) terminate
or modify in any material respect any rights of, or accelerate or otherwise
affect in any material respect any obligation of, TDS USA or TDS Canada under,
any Acquired Lease.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Authorization and Enforceability</U>. Except
as set forth on <U>TDS Schedule 4.6.1</U>, each of the Acquired Leases: (i) has
been duly authorized, executed and delivered by TDS USA or TDS Canada, as
applicable, and, to the Knowledge of DEI and Seller, the other parties thereto,
(ii) remains in full force and effect to the extent of its terms without
amendments or modifications not reflected on <U>TDS Schedule 4.6.1</U> and made
available to Buyer; and (iii) is binding on TDS USA or TDS Canada, as
applicable, and, to the Knowledge of DEI and Seller, the other parties thereto,
in accordance with its terms and applicable Laws, subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws and legal and
equitable principles affecting, limiting or relating to creditors rights
generally, and general principles of equity, including unconscionability,
reasonableness and good faith and fair dealing.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Eminent Domain</U>. The Company has not received
written notice of any proceedings in eminent domain, expropriation, condemnation
or other similar proceedings that are pending, and, to the Knowledge of DEI and
Seller, there are no such proceedings threatened, affecting any portion of the
real property leased under the Acquired Leases.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>Owned Real Property</U>. The Company does not own any real
property used in the Business.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>No Assignment</U>. TDS USA or TDS Canada is the tenant
under each Acquired Lease and neither TDS USA nor TDS Canada has Transferred its
rights or interests under any Acquired Lease.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>Guarantees</U>. Other than the U.K. Lease Guarantees and
any guarantees of any Acquired Leases listed on <U>TDS Schedule 4.6.1</U>,
neither TDS USA nor TDS Canada has provided any guarantees with respect to any
lease for real property.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>Company Remodel Plans</U>. Copies of the Company Remodel
Plans that are true and complete in all material respects have been made
available to Buyer prior to the date hereof.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Personal
Property</U>. The Company has good and valid title to its owned personal
property assets used in the Business, free and clear of any Encumbrances, except
for Permitted Encumbrances. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Non-IT Intellectual Property and Information
Technology</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Non-IT
Intellectual Property; Disney Information Technology</U>. As of the Closing, the
Company will not own, license, control or otherwise possess any rights to use
any Non-IT Intellectual Property (except as may be provided in the License and
Conduct of Business Agreement) or Disney Information Technology. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Company
Information Technology</U>. The Company owns or possesses adequate and
enforceable rights to use the Company Information Technology in connection with
the Business as currently conducted. Except as set forth on <U>TDS Schedule
4.7.2</U>, the Company has not granted to any unrelated Person any license,
sublicense or other similar right relating in whole or in part to the use of the
Company Information Technology. Except as set forth on <U>TDS Schedule 4.9</U>,
no Action alleging that the Company's use or proposed use of the Company
Information Technology infringes in any material respect upon or violates in any
material respect the rights of any Person in or to such Company Information
Technology is pending or, to the Knowledge of DEI and Seller, threatened against
or affecting TDS USA or TDS Canada or any of their respective properties or
assets. To the Knowledge of DEI and Seller, the Company has not received written
notice that its use of the Company Information Technology infringes upon or
violates the rights of any Person in or to such Company Information Technology.
Provided that the Consents and Permits listed on <U>TDS Schedule 4.8.2</U> are
obtained prior to Closing, except as set forth on <U>TDS Schedule 4.7.2</U>, the
execution by DEI, Seller and/or any of their Affiliates, as applicable, of this
Agreement, the Related Agreements and the other agreements and documents to be
executed by them in connection herewith or therewith, and the consummation of
the transactions contemplated hereby or thereby, will not impair, in any
material respect, the right of the Company to use the Company Information
Technology. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Authorization; No Conflicts</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.8.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Authorization</U>.
All necessary action on the part of each of DEI, Seller and their Affiliates, as
applicable, has been duly and validly taken to authorize the execution, delivery
and performance of this Agreement, the Related Agreements and any other
agreements and instruments to be executed and delivered by it in connection
herewith. This Agreement has been duly executed and delivered by DEI and Seller
and constitutes the legally valid and binding obligation of each of them,
enforceable against each of them in accordance with its terms, and the Related
Agreements, when executed and delivered by DEI, Seller and/or their Affiliates
who are parties thereto, will constitute the legally valid and binding
obligations of such parties, enforceable against such parties in accordance with
their respective terms, in each case subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws and legal and equitable
principles affecting, limiting or relating to creditors rights generally, and
general principles of equity, including unconscionability, reasonableness and
good faith and fair dealing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.8.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No
Conflicts</U>. Provided that, prior to the Closing, (a)&#160;the Consents
required to be obtained from third Persons listed on <U>TDS Schedule 4.8.2</U>
(excluding any Consents under Leases for Non-Transferable Stores, Expired Lease
Stores and Deferred Stores) and the Permits required to be obtained from any
Governmental Entity listed on <U>TDS Schedule 4.8.2</U> (including, without
limitation, any required approval under the Investment Canada Act) are obtained,
(b)&#160;any required filings under the Hart-Scott-Rodino Act have been made and
the applicable waiting period thereunder shall have expired or been terminated,
and (c)&#160;any consents, waivers, filings, authorizations or other approvals
as may be required under applicable Law have been obtained, neither the
execution, delivery and performance by DEI, Seller and/or any of their
Affiliates, as applicable, of this Agreement, the Related Agreements or any
other agreements and instruments to be executed and delivered by them in
connection herewith or therewith nor the consummation of the transactions
contemplated hereby or thereby will: (i)&#160;violate any provision of the
charter, articles, bylaws, operating agreement or similar organizational or
governing documents of DEI, Seller, any such Affiliate, TDS USA or TDS Canada;
(ii)&#160;violate in any material respect any Law to which DEI, Seller, any such
Affiliate, TDS USA or TDS Canada is subject; (iii)&#160;violate in any material
respect any Material Contract, Employment Contract or Acquired Lease; or
(iv)&#160;result in the imposition of any Encumbrance (other than Permitted
Encumbrances) against TDS USA or TDS Canada or any of their respective
properties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Legal Proceedings</U>. Except as set forth
on <U>TDS Schedule 4.9</U>, there is no Action pending or, to the Knowledge of
DEI and Seller, threatened against TDS USA or TDS Canada (i) the sole purpose of
which is to obtain equitable relief to enjoin TDS USA or TDS Canada from
engaging in any particular activity, (ii) seeking damages in excess of $750,000,
(iii) that otherwise would constitute a Material Adverse Event or (iv) that has
or might reasonably be expected to have a material adverse effect on the
respective abilities of DEI, Seller or any of their Affiliates to perform their
respective obligations under this Agreement or the Related Agreements, as
applicable, or the transactions contemplated hereby or thereby. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Permits</U>. The Company holds all Permits
that are required to permit the Company to conduct the Business, other than
Permits the absence of which would not constitute a Material Adverse Event.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Compliance with Law</U>. The Business is
being conducted in accordance with applicable Laws, except for such
noncompliance as would not constitute a Material Adverse Event. Except as set
forth on <U>TDS Schedule 4.11</U>, to the Knowledge of DEI and Seller, none of
DEI, Seller or the Company has received notice of non-compliance with applicable
Laws from any Governmental Entity since January 1, 2003. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Employee Benefit Plans</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.12.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Disney
Plans</U>. Buyer has no obligation to contribute to, or any liability in respect
of, any Disney Plan and, following the Closing, the Company will have no
obligation to contribute to, or any liability in respect of, any Disney Plan.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.12.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Employee
Benefit Plan Information</U>. <U>TDS Schedule 4.12.2</U> sets forth a true and
complete list of all material Employee Benefit Plans in which Continuing
Employees participate. The Company has made available to Buyer: (i) with respect
to each Employee Benefit Plan listed on <U>TDS Schedule 4.12.2</U>, the current
summary plan description of or, if the Company is not required to prepare, file
or distribute a summary plan description, all documents that set forth the terms
of such Employee Benefit Plan and any related trust, or a written description of
such Employee Benefit Plan; (ii) the OPEIU Agreement; and (iii) the current
Company employee policy manual. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.12.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Company
Plans</U>. As of the date hereof, there are two (2) Company Plans, which are
listed on <U>TDS Schedule 4.12.3</U>. As of the Closing, there shall be no
Company Plans. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.12.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No HIPAA
Violations</U>. Neither the Company, nor any employee, officer, director,
administrator or agent thereof, is or has been in violation of the transaction
and code set rules under Sections 1172 to 1175 of HIPAA or the HIPAA privacy
rules under 45 C.F.R. Part 160 and Subparts A and E of Part 164. No penalties
have been imposed on the Company, any Company Plan, or any employee, officer,
director, administrator or agent thereof, under Section 1176 or 1177 of HIPAA.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.12.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Parachute
Payments</U>. The Company is not obligated under any Employee Benefit Plan or
any other agreement to pay any amount that would subject the recipient of such
payment to any excise tax under Section 4999 of the Code. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.12.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Prohibited
Transactions</U>. As of the date hereof, the Company has not engaged in any
material transaction in violation of Section 404 or 406 of ERISA or any material
"prohibited transaction" as defined in Section 4975(c)(1) of the Code, for which
no exemption exists under Section 408 of ERISA or Section 4975(c)(2) of the
Code. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.12.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Continuing
Employee Schedule</U>. The information contained on <U>TDS Schedule 7.4.1</U>
pertaining to the current position and length of service of each Continuing
Employee listed thereon is true and complete in all material respects. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Environmental Compliance</U>. Except as set
forth on <U>TDS Schedule 4.13</U>, to the Knowledge of DEI and Seller, the
Business is in compliance with Existing Environmental Requirements, except for
such noncompliance as would not constitute a Material Adverse Event. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.14&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Brokers or Finders</U>. No agent,
broker, finder, investment or commercial banker or other Person or firm engaged
by or acting on behalf of DEI or any of its Affiliates in connection with the
negotiation, execution or performance of this Agreement, the Related Agreements
or the transactions contemplated hereby or thereby is or will be entitled to any
broker's or finder's or similar fee or other commission as a result of this
Agreement, the Related Agreements or such transactions, except for any fee that
may become payable to Bear, Stearns &amp; Co. Inc. or Goldman, Sachs &amp; Co.,
for which DEI and/or Seller shall have sole responsibility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.15&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Retained Assets</U>. Except as set forth on
<U>TDS Schedule 1.1(d)</U>, the Company does not own, lease, license, control or
hold any properties, assets or rights that constitute Retained Assets.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.16&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Absence of Certain Changes and Events</U>.
From the Balance Sheet Date through the date hereof, except as set forth on
<U>TDS Schedule 4.16</U> or as otherwise disclosed in the TDS Schedules or as
expressly contemplated by this Agreement (including, without limitation, Section
2.1), and except as may have been required by applicable Law and except for any
actions that do not affect or relate to the Business, the Company has conducted
the Business only in the ordinary course and the Company has not: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agreed to
incur any obligation or liability of the Business outside the ordinary course of
business that individually calls for payment by the Company of more than
$250,000 in any specific case or $750,000 in the aggregate, other than under any
Material Contracts, Employment Contracts, Leases or Retained Asset Agreements;
or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Transferred
any non-Lease assets of the Business owned by the Company (i) to Seller or DEI
or their Affiliates, except for (A) distributions or other Transfers of the
Retained Assets, (B) distributions or dividends in the form of cash and/or cash
equivalents, (C) Transfers of cash and/or cash equivalents to pay intercompany
loans or other intercompany debt and (D) Transfers of Disney Dollars or Disney
Theme Park Passports; or (ii) to any third party, except for dispositions of
property to third parties (A) in the ordinary course of business or (B) not
greater than $250,000 in any specific case or $1,000,000 in the aggregate
outside the ordinary course of business; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;made any
capital expenditure commitments (other than New Capital Expenditure
Requirements) with respect to the Business of more than $650,000 individually or
$2,000,000 in the aggregate; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;granted any
increase in the salary or benefits of any Continuing Employees, other than (i)
regularly scheduled salary or benefit increases in the ordinary course of
business, (ii) increases in salary and benefits in the ordinary course of
business in connection with promotions and/or increases of responsibilities or
duties, (iii) payment or agreement to pay regularly scheduled bonuses in the
ordinary course of business, and (iv) with respect to Employment Contracts as
set forth in Section 6.3.9; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;discontinued
the Retention Program with respect to any Continuing Employee; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;acquired,
directly or indirectly, substantially all of the assets of, or a controlling
equity interest in, any Person, which assets or equity interests do not
constitute Retained Assets, or entered into any commitment to do the same; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;incurred any
Indebtedness other than Indebtedness (i) consisting of intercompany Indebtedness
that will not be an obligation of the Company as of the Closing, (ii) incurred
in the ordinary course of business consistent with past practice, such as trade
payables and accruals, or (iii) incurred in connection with actions permitted to
be taken under Section 6.3; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;prepaid any
expense, except for any such prepayments (i) made in the ordinary course of
business or (ii) not greater than $250,000 in any specific case or $500,000 in
the aggregate outside the ordinary course of business; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;agreed to take
(or cause to be taken) any actions described in Sections 4.16.1 through 4.16.8.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.17&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Title to Assets</U>. The Company has good
title to all assets purported to be owned by it and used solely in the Business,
free and clear of all Encumbrances, except for Permitted Encumbrances (provided
that no representation or warranty is made or deemed to be made hereby with
respect to any Retained Assets). Other than as contemplated by this Agreement,
the Related Agreements, any Acquired Lease or any Material Contract, no material
property improvements (including leasehold improvements), material equipment or
other material tangible assets owned by the Company and used solely in the
Business (and not constituting a Retained Asset) are subject to any commitment
or other arrangement for their sale or use by any Affiliate of Seller or DEI or
third parties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;4.18&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Labor Matters</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.18.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as set
forth on <U>TDS Schedule 4.18</U>, in connection with the Business, (i) the
Company is not a party to any labor agreement with respect to the Continuing
Employees with any labor organization, group or association and (ii) since
January&#160;1, 2003, the Company has not experienced any attempt by a labor
organization to organize or represent any of the Continuing Employees. In
connection with the Business, the Company is in compliance in all material
respects with all applicable Laws respecting employment practices, terms and
conditions of employment and wages and hours and is not engaged in any unfair
labor practice. There is no unfair labor practice charge or complaint against
the Company pending before the National Labor Relations Board arising out of the
Company's activities with respect to the Business and, to the Knowledge of DEI
and Seller, there are no facts that would give rise thereto. There is no labor
strike or labor disturbance pending or, to the Knowledge of DEI and Seller,
threatened against the Company in connection with the Business. The Company has
not experienced any material work stoppage in connection with the Business since
January&#160;1, 2003. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.18.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There are no
collective bargaining agreements currently in effect that cover any Employees of
the Business or any retired Employees of the Business other than the Agreement
dated as of August 1, 2004 between DEI and Office and Professional Employees
International Union Local No. 140 (the <B>"OPEIU Agreement"</B>). None of the
Employees of the Business who are covered by the OPEIU Agreement either as of
the date of this Agreement or as of the Closing Date are Continuing Employees.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.19&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Other Agreements to Sell</U>. Neither
Seller nor DEI nor their Affiliates have any legal obligation, absolute or
contingent, to any Person other than Buyer to sell the Shares and the Membership
Units or to enter into any agreement with respect thereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.20&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Payments</U>. During the twelve (12) month
period immediately preceding the date hereof, to the Knowledge of DEI and
Seller, neither the Company nor any of its officers or directors has, directly
or indirectly, in connection with the Business, made any material payment to any
supplier of the Company or any officer, director, partner, employee or agent of
any such supplier or any governmental official that, when made, was illegal
under applicable Law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.21&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Bank Accounts</U>. <U>TDS Schedule 4.21</U>
sets forth a list of each bank in which the Company maintains an account or safe
deposit box and the corresponding number of each such account or safe deposit
box. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.22&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>DWS</U>. As of the date hereof, DWS has
fixed assets with a book value of at least One Hundred Million Dollars
($100,000,000). </FONT></P>

<P ALIGN=CENTER><B>ARTICLE V<BR>
REPRESENTATIONS AND WARRANTIES OF BUYER</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Buyer represents and warrants to DEI and Seller as follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Organization; Capitalization</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Organization
and Authority of USA Purchaser</U>. USA Purchaser is a limited liability company
duly formed, validly existing and in good standing under the laws of the State
of Delaware. USA Purchaser has the requisite power and authority to
(a)&#160;execute and deliver this Agreement and the documents and instruments
contemplated hereby, (b)&#160;perform and comply with all of the terms,
conditions and covenants to be performed and complied with by it hereunder and
thereunder and (c)&#160;own its properties and assets and carry on its business
as contemplated by this Agreement and the License and Conduct of Business
Agreement. USA Purchaser is wholly owned by TCP and was newly formed for the
sole purpose of entering into and consummating the transactions contemplated by
this Agreement, and USA Purchaser has and will have no assets or operations
other than acting as a holding company for New TDS LLC and the Membership Units
and the indirect parent company for Canadian Purchaser. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Incorporation
and Authority of New TDS LLC and New TDS Canada</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>New TDS LLC</U>. New TDS LLC is a limited
liability company duly formed, validly existing and in good standing under the
laws of the State of Delaware. New TDS LLC has the requisite power and authority
to (i) execute and deliver the documents and instruments contemplated hereby,
(ii) enter into, perform its obligations in connection with and consummate the
TDS USA Merger, and (iii) own its properties and assets and carry on its
business as contemplated by this Agreement and the License and Conduct of
Business Agreement and as intended to be conducted following the TDS USA Merger.
New TDS LLC is wholly owned by USA Purchaser and was newly formed for the sole
purpose of serving as the parent for Canadian Purchaser and entering into and
consummating the TDS USA Merger and acting as a licensee under the License and
Conduct of Business Agreement, and New TDS LLC has and will have no assets or
operations other than, following the TDS USA Merger, those associated with the
Business.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>New TDS Canada</U>. New TDS Canada is a corporation duly
incorporated, validly existing and in good standing under the laws of the
Province of New Brunswick. As of the Closing Date, New TDS Canada (i) will have
the requisite power and authority to (A) execute and deliver the documents and
instruments contemplated hereby, (B) enter into, perform its obligations in
connection with and consummate the Canada Reincorporation and (C) own its
properties and assets and carry on its business as contemplated by this
Agreement and the License and Conduct of Business Agreement and as intended to
be conducted following the Canada Reincorporation; and (ii) will be a wholly
owned subsidiary of Canadian Purchaser, newly formed for the sole purpose of
entering into and consummating the Canada Reincorporation and acting as licensee
under the License and Conduct of Business Agreement. New TDS Canada has and will
have no assets or operations other than, following the Canada Reincorporation,
those associated with the Business.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Incorporation
and Authority of Canadian Purchaser</U>. Canadian Purchaser is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State of Delaware. Canadian Purchaser has the requisite power and authority to
(a)&#160;execute and deliver this Agreement and the documents and instruments
contemplated hereby, (b)&#160;perform and comply with all of the terms,
conditions and covenants to be performed and complied with by it hereunder and
thereunder and (c)&#160;own its properties and assets and carry on its business
as contemplated by this Agreement and the License and Conduct of Business
Agreement. Canadian Purchaser is a wholly owned subsidiary of New TDS LLC that
was newly formed for the sole purpose of entering into and consummating the
transactions contemplated by this Agreement, and Canadian Purchaser has and will
have no assets or operations other than acting as a holding company for New TDS
Canada and the Shares. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Incorporation
and Authority of TCP</U>. TCP is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware. TCP has
the requisite power and authority to (a)&#160;execute and deliver the
Acquisition Agreement Guarantee and the documents and instruments contemplated
thereby, (b)&#160;perform and comply with all of the terms, conditions and
covenants to be performed and complied with by TCP thereunder and (c)&#160;own
its properties and assets and carry on its business as currently conducted.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Capitalization;
Outstanding Securities</U>. The authorized capital of USA Purchaser consists of
Ten (10) units of membership interest, all of which are outstanding. The
authorized capital of New TDS LLC consists of Ten (10) units of membership
interest, all of which are outstanding. The authorized capital of Canadian
Purchaser consists of One Thousand (1,000) shares of common stock, all of which
are outstanding. The authorized share capital of New TDS Canada consists of an
unlimited number of common shares, of which One Hundred (100) are issued and
outstanding. All Outstanding USA Purchaser Securities (a)&#160;are, and as of
the Closing Date will be, solely owned by TCP, (b)&#160;have been, and as of the
Closing Date will have been, duly authorized and validly issued, and
(c)&#160;are, and as of the Closing Date will be, fully paid and non-assessable
and held by TCP free and clear of all Encumbrances. All Outstanding New TDS LLC
Securities (aa)&#160;are, and as of the Closing Date will be, solely owned by
USA Purchaser, (bb)&#160;have been, and as of the Closing Date will have been,
duly authorized and validly issued, and (cc)&#160;are, and as of the Closing
Date will be, fully paid and non-assessable and held by USA Purchaser free and
clear of all Encumbrances. All Outstanding Canadian Purchaser Securities
(x)&#160;are, and as of the Closing Date will be, solely owned by New TDS LLC,
(y)&#160;have been, and as of the Closing Date will have been, duly authorized
and validly issued, and (z)&#160;are, and as of the Closing Date will be, fully
paid and non-assessable and held by New TDS LLC free and clear of all
Encumbrances. As of the Closing Date, all Outstanding New TDS Canada Securities
(xx) will be solely owned by Canadian Purchaser, (yy)&#160;will have been duly
authorized and validly issued, and (zz)&#160;will be fully paid and
non-assessable and held by Canadian Purchaser free and clear of all
Encumbrances. There are no outstanding options, warrants, rights or other
Securities convertible into, or exercisable for, USA Purchaser Securities,
Canadian Purchaser Securities, New TDS LLC Securities or New TDS Canada
Securities. <U>Buyer Schedule 5.1.5(a)</U> sets forth a true and complete list
of (i)&#160;all Outstanding TCP Securities as of the date hereof and
(ii)&#160;to Buyer's Knowledge, the names of the beneficial holders of five
percent (5%) or more of such Outstanding TCP Securities and the amount of
Outstanding TCP Securities held by each such holder. All Outstanding TCP
Securities (1) have been, and as of the Closing Date will have been, duly
authorized and validly issued, and (2) are, and as of the Closing Date will be,
fully paid and non-assessable. Except as set forth on <U>Buyer Schedule
5.1.5(a)</U>, there are no outstanding options, warrants, rights or other
Securities convertible into, or exercisable for, TCP Securities. The Outstanding
TCP Securities as of the Closing Date and, to Buyer's Knowledge, the names of
the beneficial holders of five percent (5%) or more of such Outstanding TCP
Securities and the amount of Outstanding TCP Securities held by each such holder
shall be as set forth on Buyer's Closing Capitalization Table delivered to DEI
and Seller pursuant to Section 6.4.1. Except as set forth on <U>Buyer Schedule
5.1.5(b)</U>, none of USA Purchaser, New TDS LLC or Canadian Purchaser has, and
as of the Closing Date none of USA Purchaser, New TDS LLC, Canadian Purchaser or
New TDS Canada will have, any direct or indirect Subsidiaries nor any other debt
or equity investments in any other Person, and TCP does not have, and as of the
Closing Date will not have, any direct or indirect Subsidiaries nor any other
debt or equity investments in any other Person that will be engaged after the
Closing in the Business in any manner. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Buyer's
Governing Documents</U>. Buyer has heretofore delivered (or, in the case of the
bylaws of New TDS Canada, will deliver prior to the Closing) to DEI and Seller
true and complete copies of (i)&#160;the charter documents (articles or
certificate of incorporation or other), bylaws, limited liability company
agreements, operating agreements and securityholders agreements of each of USA
Purchaser, New TDS LLC, Canadian Purchaser, New TDS Canada, TCP and any Parent
Affiliate of TCP as in effect on the date hereof (or, in the case of the bylaws
of New TDS Canada, as will be in effect on the Closing Date) and (ii)&#160;other
governing documents or Contracts pertaining to the management or operation of
USA Purchaser, New TDS LLC, Canadian Purchaser, New TDS Canada, TCP and/or TCP's
Parent Affiliates or the ownership of any Securities thereof (collectively,
"Buyer's Governing Documents"). There have been no amendments, restatements or
modifications to Buyer's Governing Documents not delivered to DEI and Seller.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;5.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Authorization; No Conflicts</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Authorization</U>.
All necessary action on the part of each of USA Purchaser and Canadian Purchaser
and each of its respective Affiliates, as applicable, has been duly and validly
taken to authorize the execution, delivery and performance of this Agreement,
the Related Agreements, the Acquisition Agreement Guarantee, the TCP Guaranty
and Commitment, and any other agreements and instruments to be executed and
delivered by it in connection herewith. This Agreement and the Acquisition
Agreement Guarantee have been duly executed and delivered by Buyer and TCP,
respectively, and constitute the legally valid and binding obligations of Buyer
and TCP, respectively, enforceable against Buyer and TCP, respectively, in
accordance with their respective terms, and the Related Agreements and the TCP
Guaranty and Commitment, when executed and delivered by Buyer and/or its
Affiliates who are parties thereto, will constitute the legally valid and
binding obligations of such parties, enforceable against such parties in
accordance with their respective terms, in each case subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws and legal and
equitable principles affecting, limiting or relating to creditors rights
generally, and general principles of equity, including unconscionability,
reasonableness and good faith and fair dealing. The Membership Unit Acquisition
and the Share Acquisition have been duly approved by all necessary action on the
part of each of USA Purchaser and Canadian Purchaser, including, as applicable,
approval of TCP, as the sole member of USA Purchaser, and the Board of Directors
of Canadian Purchaser. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No
Conflicts</U>. Provided that, prior to the Closing, (a)&#160;the Permits
required to be obtained from any Governmental Entity listed on <U>TDS Schedule
4.8.2</U> (including, without limitation, any required approval under the
Investment Canada Act) are obtained, (b)&#160;any required filings under the
Hart-Scott-Rodino Act have been made and the applicable waiting period
thereunder shall have expired or been terminated, and (c)&#160;any consents,
waivers, filings, authorizations or other approvals as may be required under
applicable Law have been obtained, then neither the execution, delivery and
performance by Buyer and/or any of its Affiliates, as applicable, of this
Agreement, the Related Agreements, the Acquisition Agreement Guarantee, the TCP
Guaranty and Commitment, or any other agreements or instruments to be executed
and delivered by them in connection herewith or therewith nor the consummation
of the transactions contemplated hereby or thereby will: (i)&#160;violate any
provision of Buyer's or any such Affiliate's articles, charter, bylaws,
operating agreement or similar organizational or governing documents;
(ii)&#160;violate any Law to which Buyer or any such Affiliate is subject that
would have a material adverse effect on Buyer's or any such Affiliate's ability
to perform its obligations hereunder or thereunder; (iii)&#160;violate any
material Contract to which Buyer or any such Affiliate is a party or is subject,
including, without limitation, the Wells Fargo Credit Facility, the
Toronto-Dominion Facility and the Merchant Services Agreement; or
(iv)&#160;result in the imposition of any material Encumbrance against Buyer or
any such Affiliate or any of their respective properties. Without limiting the
foregoing, Buyer hereby represents and warrants to DEI and Seller that (x) the
Company and the Business to be Transferred to Buyer (including the Acquired
Stores and all properties, assets, rights, liabilities and obligations relating
to the conduct and operation of the Business and such Acquired Stores) shall not
be subject to or in any manner encumbered by the Wells Fargo Credit Facility or
the Toronto-Dominion Facility and shall not constitute collateral or any other
security interest thereunder, and (y) the Company and the Business to be
Transferred to Buyer (including the Acquired Stores) shall not be subject to any
provisions of the Merchant Services Agreement (including such provisions as may
relate to promotion of TCP's private label credit card or related credit card
program, the issuance, sponsorship, marketing or acceptance of, or other
participation with respect to, any other private label or co-branded credit
card, or the use or sharing of customer lists or similar information).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Legal Proceedings</U>. There is no Action
pending or, to the Knowledge of Buyer, threatened against or affecting Buyer or
any of its Affiliates or any of their respective properties or assets that has
or might reasonably be expected to have a material adverse effect on the
respective abilities of Buyer or any of its Affiliates to perform their
respective obligations under this Agreement, the Related Agreements, the
Acquisition Agreement Guarantee, or the TCP Guaranty and Commitment, as
applicable, or the transactions contemplated hereby or thereby. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Buyer's Financing and Liquidity</U>.
<U>Buyer Schedule 5.4</U> sets forth, as of the date hereof, (a) a true and
complete list of Buyer's and TCP's anticipated sources of funds (other than
those set forth on <U>Buyer Schedule 5.1.5(a)</U>) to acquire the Membership
Units and the Shares and pay all other amounts required to be paid by Buyer
and/or TCP under this Agreement, the Related Agreements, the Acquisition
Agreement Guarantee and the TCP Guaranty and Commitment, including the identity
of each such source and, if available, the approximate amount expected to be
funded by each such source and a summary of the material terms and conditions on
which Buyer and/or TCP expect to obtain such funds, and (b) Buyer's and TCP's
good faith estimate of their internal and external sources of liquidity for a
period of two (2) years following the Closing Date, including a reasonably
detailed description of the provider and, if available, the type, material terms
and amount of each such source of liquidity. Buyer and TCP will have available,
on the Closing Date, the Working Capital Deferred Delivery Date, the Subsequent
Closing Date and the date on which final payments are due under Section
2.3.2(c), sufficient funds to enable them to consummate the Membership Unit
Acquisition and the Share Acquisition and pay all other amounts required to be
paid by them as of the Closing Date, the Working Capital Deferred Delivery Date,
the Subsequent Closing Date and the date on which final payments are due under
Section 2.3.2(c), respectively, under this Agreement, the Related Agreements,
the Acquisition Agreement Guarantee and the TCP Guaranty and Commitment. The
funds used by Buyer and TCP to consummate the Membership Unit Acquisition and
the Share Acquisition and pay such other amounts shall have been drawn under the
Company Credit Facility or contributed, provided or otherwise made available to
Buyer or TCP as set forth on Buyer's Closing Capitalization Table delivered to
DEI and Seller pursuant to Section 6.4.1. As of the Closing Date, Buyer's
Liquidity Plan and the sources of liquidity identified therein shall be as
reported to DEI and Seller pursuant to Section 6.4.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Brokers or Finders</U>. No agent, broker,
finder, investment or commercial banker or other Person or firm engaged by or
acting on behalf of Buyer or any of its Affiliates in connection with the
negotiation, execution or performance of this Agreement, the Related Agreements,
the Acquisition Agreement Guarantee, the TCP Guaranty and Commitment or the
transactions contemplated hereby or thereby is or will be entitled to any
broker's or finder's or similar fees or other commission as a result of this
Agreement, the Related Agreements, the Acquisition Agreement Guarantee, the TCP
Guaranty and Commitment or such transactions, except for any fee that may become
payable to Peter J. Solomon Company, for which Buyer shall have sole
responsibility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Investment Representations</U>. Buyer
understands that the Membership Units and the Shares have not been registered
under the Securities Act and are being offered and transferred under an
exemption from registration contained in the Securities Act based in part upon
the following representations of Buyer: (i)&#160;Buyer is an "accredited
investor" within the meaning of Regulation D under the Securities Act;
(ii)&#160;Buyer is acquiring the Membership Units and the Shares for Buyer's own
account for investment purposes only, and not with a view towards their
distribution in violation of the Securities Act or applicable "blue sky" laws of
any state; and (iii)&#160;by reason of its business or financial experience,
Buyer has the capacity to protect its own interests in connection with the
transactions contemplated by this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Non-Canadian; Non-Resident of Canada</U>.
Neither USA Purchaser nor Canadian Purchaser is a Canadian within the meaning of
the Investment Canada Act, and each of USA Purchaser and Canadian Purchaser is a
non-resident of Canada within the meaning of the Income Tax Act (Canada).
</FONT></P>

<P ALIGN=CENTER><B>ARTICLE VI<BR>
COVENANTS WITH RESPECT TO CONDUCT OF DEI, SELLER,<BR>
COMPANY AND BUYER PRIOR TO CLOSING</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
the date hereof through and including the Closing Date (or, to the extent
specifically provided in this Article VI, including, without limitation, Section
6.7, following the Closing Date), Buyer, DEI and Seller will, and DEI and/or
Seller will cause the Company to, comply with the applicable terms and
provisions of this Article VI. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;6.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Access; Books and Records</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon reasonable
notice given in accordance with this Agreement from Buyer to DEI and Seller, DEI
and Seller will authorize and permit Buyer and its Representatives (and other
Persons acting on behalf of Buyer (including Buyer's lenders) that (i) sign a
confidentiality agreement with DEI and/or its Affiliates on terms substantially
the same as those contained in the Confidentiality Agreement and (ii) are
approved by DEI and Seller in their respective business judgment) to have
reasonable access during normal business hours, in such manner as will not
interfere with the conduct of the business of the Company and subject to the
indemnification obligations set forth in Section 6.1.3, to all of the Company's
books, records, Tax Returns (other than consolidated or combined Tax Returns
that include the income and activities of entities other than the Company,
unless and only to the extent that DEI and Seller determine in their respective
sole discretion that any portion thereof relates solely to the income and
activities of TDS USA or TDS Canada and it is practical to provide such limited
portion to Buyer) and other information pertaining to the Business as Buyer may
from time to time reasonably request, and, at Buyer's expense, to make copies of
such books, records and other documents, and to discuss the Business with the
officers, accountants and counsel of the Company as reasonably requested by
Buyer, and, upon at least three (3) Business Days' written notice from Buyer to
DEI and Seller, to enter, inspect and investigate the Acquired Stores. DEI and
Seller hereby agree and acknowledge that pursuant to and in accordance with the
preceding sentence, they shall, upon request by Buyer, provide access to the
following specific information pertaining to the Business (provided that (a) DEI
or Seller has the appropriate personnel to extract, collect and transmit such
specific information and (b) any incremental costs incurred by DEI or its
Affiliates to extract, collect and transmit such specific information shall be
paid by Buyer within ten (10) Business Days after presentation of an invoice
therefor), and Buyer acknowledges that any analysis of such information shall be
performed by Buyer and not by DEI or its Affiliates: (i) monthly and weekly
data, by department, regarding units and cartons of merchandise shipped by or on
behalf of the Company during the full twelve (12) months most recently completed
prior to the date hereof and (ii) monthly and weekly data, by department,
regarding units and cartons of merchandise received by the Company during the
full twelve (12) months most recently completed prior to the date hereof. Any
information provided to or on behalf of Buyer or any Person acting on its behalf
pursuant to this Section 6.1 will be subject to the provisions of Section 11.9.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither Buyer
nor any Person acting on its behalf shall make any contact with the vendors,
suppliers, landlords or employees (other than any Seller Consent Officer) of the
Company or any of its Affiliates or other parties to any Contract or Lease with
the Company or any of its Affiliates or conduct any environmental sampling or
invasive or destructive testing, except with the express prior written consent
of one (1) of the Seller Consent Officers (whether such written consent has been
given prior to, or is given after, the date hereof), which consent (i) may
relate either to a particular communication or to a process by which certain
communications may occur, (ii) may be granted or withheld in the sole discretion
of the applicable Seller Consent Officer, and (iii) may be provided by any
Seller Consent Officer via email or in any other written format; provided,
however, that Seller and DEI shall permit Buyer to communicate with Employees
and landlords and vendors of the Company in the presence, or with the
participation, of a duly authorized representative of DEI or any of its
Affiliates. Nothing herein will obligate DEI, Seller or the Company to take
actions that would violate the terms of any applicable Law or any Contract or
Lease to which the Company or any of its Affiliates is a party or by which the
Company, any of its Affiliates or the assets of the Company or any of its
Affiliates are bound. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall
defend (either with counsel satisfactory to DEI, or at the option of DEI, DEI
and its Affiliates may conduct their own defense at Buyer's sole cost and
expense), indemnify and hold DEI and its Affiliates harmless from and against
any and all Loss arising directly or indirectly from, out of or based on Buyer's
exercise of its rights under this Section 6.1, whether by Buyer itself or by any
Person acting on Buyer's behalf. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Financial Statements; Updates to TDS Schedules;
Post-Closing Merchandise Plan</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Financial
Statements</U>. DEI or Seller will furnish to Buyer (i) within ten (10) Business
Days after the last day of each fiscal month of the Company, monthly unaudited
combined balance sheets and statements of operations of the Business for the
preceding fiscal month of the Company, which shall be prepared in the ordinary
course of business consistent with past practice (except, in the case of past
practice, as disclosed therein with respect to any particular item(s)) but shall
not necessarily be prepared in accordance with GAAP or Modified GAAP, and (ii)
within fifteen (15) Business Days after the last day of each fiscal quarter of
the Company, quarterly unaudited combined balance sheets, statements of
operations and cash flows of the Business for the preceding fiscal quarter of
the Company, which shall fairly present the financial condition and results of
operation of the Business and shall be prepared in all material respects in
conformity with Modified GAAP during the periods covered (except, in the case of
Modified GAAP, as disclosed therein with respect to any particular item(s)).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Updates to
TDS Schedules</U>. No later than five (5) Business Days prior to the Closing
Date, DEI and Seller shall be entitled to deliver to Buyer an amendment of any
portion of the TDS Schedules that relate to the representations and warranties
of DEI and Seller under this Agreement to reflect any additions thereto that
occurred or were discovered between the date of this Agreement and the Closing
Date (any such additions, the <B>"Supplemental Disclosure Items"</B>). Each of
DEI, Seller and Buyer acknowledges and agrees that (i) subject to subparagraph
(ii) below, the Supplemental Disclosure Items shall be deemed to be incorporated
into such TDS Schedules effective as of the date of this Agreement as if
actually set forth therein on the date of this Agreement solely for purposes of
determining whether the condition contained in subparagraph (a) of Section 8.2.1
has been satisfied; (ii) if any Supplemental Disclosure Item relates to an
action or omission on the part of DEI or Seller that would constitute a breach
of Section 6.3, 6.7, 7.4.1(ii) or 7.4.4, the addition of such Supplemental
Disclosure Item to the TDS Schedules shall not be deemed to cure such breach;
and (iii) the indemnification obligations of DEI and Seller with respect to the
Supplemental Disclosure Items shall be determined pursuant to Section 10.2.1(ix)
rather than Section 10.2.1(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Post-Closing Merchandise Plan</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Preparation of Draft Post-Closing Merchandise
Plan</U>. In order to better ensure that the Business is not diminished or wasted
during the period prior to the Closing Date, DEI and Seller shall prepare (or
shall cause to be prepared) one (1) or more formalized merchandise plans setting
forth information relating to merchandise categories and styles, assortment and
manufacturers to be employed by the Company, and the budget therefor, that
relate or may relate to any period after the Closing Date and that affect or may
affect the Business to be acquired by Buyer pursuant to this Agreement (each
such formalized merchandise plan, a <B>"Draft Post-Closing Merchandise
Plan"</B>). DEI and Seller shall deliver (or shall cause to be delivered) to
Buyer, upon preparation thereof, each such Draft Post-Closing Merchandise Plan.
If and when a Draft Post-Closing Merchandise Plan becomes a Final Post-Closing
Merchandise Plan pursuant to subparagraph (b) or (c) below, then DEI and Seller
shall, subject to the provisions contained in this Section 6.2.3, cause the
Company to comply in all material respects with such Final Post-Closing
Merchandise Plan.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Final Post-Closing Merchandise Plans and
Changes to Final Post-Closing Merchandise Plans Prior to Buyer's Election Under
Subparagraph (c)</U>. Unless and until Buyer makes the election specified in
subparagraph (c) of this Section 6.2.3 (which election shall be invalid during
any period in which any filing or matter under the Hart-Scott-Rodino Act is
pending) in the manner provided therein, the provisions of this subparagraph (b)
shall apply.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Final Post-Closing Merchandise Plans</U>.
DEI and Seller shall consult with Buyer regarding the contents of each Draft
Post-Closing Merchandise Plan and shall consider in good faith any
recommendations made by Buyer (which recommendations must be made within five
(5) Business Days following Buyer's receipt of any Draft Post-Closing
Merchandise Plan) with respect to the contents thereof (including, without
limitation, those recommendations set forth in subparagraph (d) below);
<U>provided</U>, that DEI and Seller shall, in their respective sole discretion,
make any final determinations regarding any changes to or modifications of the
contents, or other any other component or element, of such Draft Post-Closing
Merchandise Plan. Following consultation with Buyer regarding a Draft
Post-Closing Merchandise Plan and after any changes or modifications to such
Draft Post-Closing Merchandise Plan are made by DEI and Seller in their
respective sole discretion, a Draft Post Closing Merchandise Plan shall become a
<B>"Final Post-Closing Merchandise Plan."</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Material Changes to Final
Post-Closing Merchandise Plans</U>. In the event that DEI, Seller or the Company
propose to make any material changes to a Final Post-Closing Merchandise Plan,
or to materially deviate from any of the terms thereof, in each case, in the
ordinary course of business, DEI and Seller shall consult with Buyer regarding
any such changes to, or deviations from, a Final Post-Closing Merchandise Plan
and shall consider in good faith any recommendations made by Buyer with respect
to such proposed changes or deviations; <U>provided</U>, that DEI and Seller
shall, in their respective sole discretion, make any final determinations
regarding any such changes to, or deviations from, a Final Post-Closing
Merchandise Plan. If DEI, Seller or the Company propose to make any material
changes to a Final Post-Closing Merchandise Plan, or to cause or permit the
Company to materially deviate from the terms thereof, other than any such
changes or deviations that are in the ordinary course of business (as to which
the preceding sentence shall apply), DEI and Seller shall, in each case, obtain
the prior approval of Buyer thereto (which approval shall not be unreasonably
withheld, conditioned or delayed and which approval shall be granted or denied
within two (2) Business Days after request thereof by DEI and
Seller).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Final Post-Closing Merchandise Plans and
Changes to Final Post-Closing Merchandise Plans After Special Election by
Buyer</U>. Buyer may elect to have the provisions of this subparagraph (c) apply
in lieu of the provisions of subparagraph (b). If Buyer desires to elect the
provisions of this subparagraph (c), Buyer shall give written notice of such
election to DEI and Seller, and the provisions of this subparagraph (c) shall
become effective on the fifth (5th) Business Day following receipt of such
notice by DEI and Seller (<U>provided</U>, <U>that</U>, such election shall be
invalid during any period in which any filing or matter under the
Hart-Scott-Rodino Act is pending).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Final Post-Closing Merchandise
Plans</U>. Buyer shall have the right to approve each Draft Post-Closing
Merchandise Plan, which approval shall not be unreasonably withheld, conditioned
or delayed and, in any event, shall be approved or disapproved within five (5)
Business Days of submission; <U>provided</U>, that, in the event that Buyer
designates one (1) or more manufacturers to be used in connection with any such
Draft Post-Closing Merchandise Plan that was not originally included in such
Draft Post-Closing Merchandise Plan (each, a <B>"Buyer Designated
Manufacturer"</B>), then (x) the Company shall not be required to use such Buyer
Designated Manufacturer (A) if such Buyer Designated Manufacturer was on the
list of disapproved manufacturers maintained by DEI and its Affiliates in the
ordinary course of business prior to Buyer's designation of such manufacturer as
a Buyer Designated Manufacturer or (B) if doing so would materially impair the
Company's ability to implement the Draft Post-Closing Merchandise Plan or its
ability to operate the Business, including, without limitation, as a result of
such Buyer Designated Manufacturer's refusal to enter into the Company's
standard vendor's memorandum of understanding or manufacturer's agreement or to
comply with the Company's standard code of conduct for manufacturers or such
Buyer Designated Manufacturer's inability to meet the Company's quality
standards, and (y) if the Company uses such Buyer Designated Manufacturer, Buyer
shall have the indemnification and reimbursement obligations set forth under
Section 6.2.3 (c)(iii)(B). Upon approval by Buyer thereof, a Draft Post-Closing
Merchandise Plan shall become a <B>"Final Post-Closing Merchandise
Plan."</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Changes to Final Post-Closing
Merchandise Plans</U>. In the event that DEI, Seller or the Company propose to make
any material changes to a Final Post-Closing Merchandise Plan, or to materially
deviate from any of the terms thereof, DEI and Seller shall, in each case,
obtain the prior approval of Buyer thereto (which approval shall not be
unreasonably withheld, conditioned or delayed and which approval shall be
granted or denied within two (2) Business Days after request thereof by DEI and
Seller); <U>provided</U>, that, for purposes of this provision, the following
changes to, or deviations from, a Final Post-Closing Merchandise Plan shall be
considered immaterial and shall not require approval by Buyer pursuant to this
subparagraph (c)(ii): (A) any changes to the budget under such Final
Post-Closing Merchandise Plan of up to three percent (3%) more or three percent
(3%) less than the total dollar amount provided therein (<U>provided</U>, that
on the sixtieth (60th) day following the date hereof, the foregoing percentages
shall automatically be increased to five percent (5%)) and (B) any changes in
the types or categories of SKUs under such Post-Closing Merchandise Plan
affecting up to three percent (3%) of the total SKUs reflected in such
Post-Closing Merchandise Plan (<U>provided</U>, that on the sixtieth (60th) day
following the date hereof, the foregoing percentage shall automatically be
increased to five percent (5%)).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Indemnification;
Reimbursement</U>. Except for, and only to the extent of, any Loss resulting
directly from the breach of any obligations of DEI, Seller and/or their
Affiliates owed to any Buyer Designated Manufacturer, Buyer shall defend,
indemnify, pay, reimburse and hold DEI, Seller and each of their Affiliates and
the officers, directors, agents, representatives, employees, successors and
assigns of each, forever harmless from and against any and all Loss (which, in
the case of the following subparagraph (B), shall be deemed to include lost
profits, notwithstanding any other provision of this Agreement to the contrary)
imposed on or incurred or suffered by such Person arising directly or indirectly
from, out of or based on (A) any Action asserted against DEI, Seller or their
Affiliates relating to, arising out of, or resulting from, Buyer's election to
make effective the provisions of this subparagraph (c) of this Section 6.2.3 or
Buyer's exercise of its approval rights over the matters set forth in this
subparagraph (c) of this Section 6.2.3, and (B) if the Closing does not occur
and the transactions contemplated by this Agreement are not consummated, the
Company's use of any Buyer Designated Manufacturer in connection with any Final
Post-Closing Merchandise Plan, including, without limitation, any such Loss
relating to, arising out of or resulting from (1) any failure of such Buyer
Designated Manufacturer to deliver merchandise manufactured pursuant to such
Final Post-Closing Merchandise Plan in accordance with the terms of any purchase
order issued by the Company or its Affiliates, (2) any failure of products
manufactured by such Buyer Designated Manufacturer pursuant to such Final
Post-Closing Merchandise Plan to comply with the specifications therefor
provided by the Company or its Affiliates to such Buyer Designated Manufacturer,
(3) any and all product liability arising from any merchandise manufactured by
such Buyer Designated Manufacturer pursuant to such Final Post-Closing
Merchandise Plan, including, without limitation, any alleged deficiency or
inadequacy in any instructions, warnings, labels or other materials included
with any such merchandise, the fitness of any such merchandise for its intended
use by consumers, any defect in design, material or workmanship of such
merchandise, any misbranding, adulteration or unsafe feature of such
merchandise, any failure of such merchandise to comply with any applicable Laws,
any breach of the Company's standard vendor's memorandum of understanding or
manufacturer's agreement or code of conduct for manufacturers, and any misuse of
any name, brand, trademark, trade name, trade dress, logo, symbol, character,
patent, copyrighted work, trade secret or other proprietary designation or
intellectual property of the Company or its Affiliates by such Buyer Designated
Manufacturer in connection with such merchandise, and (4) any injury to person
or property or illness or death allegedly resulting from the foregoing
subparagraph (3); <U>provided</U>, <U>that</U>, Buyer shall be subrogated to the
rights of DEI, Seller and their Affiliates with respect to any Loss indemnified,
paid or reimbursed by Buyer pursuant to this subparagraph (B) of this Section
6.2.3(c)(iii). The obligations of Buyer under this Section 6.2.3(c)(iii) shall
survive the expiration or termination of this Agreement indefinitely.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Recommendations as to Contents of Draft
Post-Closing Merchandise Plans</U>. In connection with any recommendations,
approvals or disapprovals of Buyer regarding the contents of any Draft
Post-Closing Merchandise Plan pursuant to subparagraph (b) or (c) of this
Section 6.2.3, Buyer shall be entitled to make recommendations regarding (i) the
types and quantities of SKUs to be ordered pursuant to such Draft Post-Closing
Merchandise Plan and new products or new SKUs, regardless of whether any such
product or SKU is contained in the Draft Post-Closing Merchandise Plan, (ii)
prospective manufacturers of products contained in the Draft Post-Closing
Merchandise Plan or new products recommended by Buyer, provided that Buyer
acknowledges and agrees that each manufacturer of products for the Company must
be a manufacturer that has entered into the Company's standard vendor's
memorandum of understanding and standard manufacturer's agreement, including a
standard manufacturer's code of conduct, in a form satisfactory to DEI in its
sole discretion, none of which may consist of a manufacturer with an existing,
exclusive manufacturing relationship with any of Buyer or its Affiliates or DEI,
Seller or any of their respective Affiliates, and (iii) the cost to be incurred
by the Company that Buyer believes to be reasonable in connection with the
manufacture of any particular products by any prospective manufacturer. In
addition, upon Buyer's reasonable request, DEI and Seller shall provide product
designs, samples and specifications to Buyer with respect to a limited selection
of SKUs or product categories as determined by DEI in its sole discretion, and
Buyer shall be permitted to provide such product designs, samples and
specifications to any manufacturer approved in accordance with this Section
6.2.3(d) in connection with obtaining a price estimate for the manufacture of
the applicable products.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Retail Pricing Information</U>.
Notwithstanding anything to the contrary contained in this Agreement, the
parties hereby agree and acknowledge that (i) no Draft Post-Closing Merchandise
Plan or Final Post-Closing Merchandise Plan shall contain any information
relating to retail pricing for Softlines, (ii) none of DEI, Seller or the
Company shall have any obligation to provide Buyer with any information relating
to retail pricing for Softlines, (iii) Buyer shall not, in connection with any
recommendations, approvals or disapprovals of Buyer regarding the contents of
any Draft Post-Closing Merchandise Plan or Final Post-Closing Merchandise Plan
pursuant to subparagraph (b) or (c) of this Section 6.2.3, be entitled to make
any recommendations relating to retail pricing for Softlines, and (iv) Buyer
shall not be entitled to disapprove a Draft Post-Closing Merchandise Plan, or
any changes to or deviations from a Final Post-Closing Merchandise Plan, in each
case, pursuant to subparagraph (b) or (c) of this Section 6.2.3, based on any
issue relating to retail pricing information for Softlines (or the lack
thereof).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Conduct of Business</U>. Unless otherwise
consented to in writing by Buyer (which consent shall not be unreasonably
withheld, conditioned or delayed), except as otherwise contemplated by this
Agreement (including, without limitation, Sections 2.1, 6.7, 6.9 and 6.10) and
except as may be required by applicable Law and except for any of the following
actions that do not affect or relate to the Business (which actions shall not be
prohibited by this Section 6.3), DEI and Seller will not permit the Company to:
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) prepay any
expense, except any such prepayments (A) made in the ordinary course of business
or (B) not greater than $250,000 in any specific case or $500,000 in the
aggregate made outside of the ordinary course of business or (ii) conduct the
Business except in the ordinary course; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;agree to incur
any obligation or liability of the Business outside of the ordinary course of
business that individually calls for payment by the Company of more than
$250,000 in any specific case or $750,000 in the aggregate, other than under any
Material Contracts, Employment Contracts, Leases or Retained Asset Agreements;
or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;enter into any
new lease or sublease or take assignment of any lease or sublease that would
become an Acquired Lease, other than as contemplated by Section 6.7 or unless it
expires prior to the Closing Date or it is on a month-to-month basis that is
terminable by giving notice only; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;renew, extend,
amend or modify any Acquired Lease other than in the ordinary course of
business, consistent with past business practices, or as contemplated by Section
6.7, except that (i) any Month-to-Month Acquired Leases may continue on a
month-to-month basis and (ii) any Acquired Lease may be extended up to, but not
beyond, January 31, 2005 without the consent of Buyer; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Transfer any of
the Acquired Leases; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Transfer any
non-Lease assets of the Business, except for (i) distributions or other
Transfers of the Retained Assets to DEI, Seller or their Affiliates, (ii)
distributions or dividends of cash and/or cash equivalents to DEI, Seller or
their Affiliates, (iii) Transfers of cash and/or cash equivalents to DEI, Seller
or their Affiliates to pay intercompany loans or other intercompany debt, (iv)
Transfers of Disney Dollars or Disney Theme Park Passports to DEI, Seller or
their Affiliates and (v) other distributions or Transfers of property
(A)&#160;in the ordinary course of business or (B)&#160;not greater than
$250,000 in any specific case or $1,000,000 in the aggregate outside the
ordinary course of business; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;make any
capital expenditure commitments (other than New Capital Expenditure
Requirements) with respect to the Business of more than $650,000 individually or
$2,000,000 in the aggregate; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;grant any
increase in the salary or benefits of any Continuing Employees, other than
(i)&#160;regularly scheduled salary or benefit increases in the ordinary course
of business, (ii) increases in salary and benefits in the ordinary course of
business in connection with promotions and/or increases of responsibilities or
duties, (iii)&#160;payment or agreement to pay regularly scheduled bonuses in
the ordinary course of business, and (iv) with respect to Employment Contracts
as set forth in Section 6.3.9; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;except as
otherwise provided in Section 6.3.8, renew, renegotiate amend or extend any
Employment Contract with a Continuing Employee (other than any renewal,
renegotiation, amendment or extension of the existing terms of any Employment
Contract that does not provide for an increase of more than twenty-five percent
(25%) in existing compensation) or enter into or assume or acquire any new
employment contract that provides for annualized compensation to any single
individual in excess of $125,000; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;except as
otherwise provided in Section 6.3.9 (i) hire or otherwise appoint any persons
holding titles of vice president (or a more senior position or title), district
managers or general managers<B> </B>or (ii) except for cause or any legal
requirement, terminate or otherwise dismiss any Key Employees (for purposes of
clarification, this Section 6.3.10 shall not prohibit DEI or its Affiliates
(other than the Company) from hiring any Key Employee who voluntarily applies
for or otherwise voluntarily solicits employment with DEI or any such Affiliate
of DEI); or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;except as
otherwise provided in Section 6.3.8, 6.3.9, 7.4.4 or 7.4.5, adopt or amend any
bonus, profit-sharing, incentive, severance or other Employee Benefit Plan,
Contract or commitment for the benefit of any Continuing Employees, except as
otherwise required under applicable Law; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;discontinue
the Retention Program with respect to any Continuing Employee; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;amend the
articles of organization, operating agreement, articles of incorporation or
bylaws of TDS USA or TDS Canada or make any change in the authorized, issued or
outstanding membership interests, capital stock (or shares) or any other equity
Security of TDS USA or TDS Canada; Transfer, or purchase, redeem, retire or
otherwise acquire, any of the membership interests in or shares of, or any
Security convertible into capital stock (or shares), membership interests or
other equity Securities of, TDS USA or TDS Canada; or grant or issue any stock
option or warrant relating to, right to acquire, or Security convertible into,
shares of capital stock (or shares), membership interests or other equity
Security of TDS USA or TDS Canada; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.14&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;acquire,
directly or indirectly, substantially all of the assets of, or a controlling
equity interest in, any Person, or enter into any commitment to do the same; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.15&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;incur any
Indebtedness (other than Indebtedness (i)&#160;consisting of intercompany
Indebtedness that will not be an obligation of the Company as of the Closing,
(ii)&#160;incurred in the ordinary course of business consistent with past
practice, such as trade payables and accruals, or (iii)&#160;incurred in
connection with actions permitted to be taken under this Section 6.3); or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.16&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;enter into or
amend any Material Contract; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.17&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;agree to take
(or cause to be taken) any actions prohibited by this Section 6.3. </FONT></P>

<P><FONT SIZE=3>In addition, from the date hereof to the Closing Date or the
earlier expiration or termination of this Agreement, DEI shall not, nor shall it
permit its Affiliates to, (i) open for the first time, within a five (5) mile
radius of any Acquired Store, an Outlet Store focused principally on the sale of
consumer products that bear, feature or incorporate Disney Branded Properties
comparable to the merchandise offered in the Stores; (ii) enter into any
Contract that, if existing prior to the date of this Agreement, would have
constituted a License Encumbrance Agreement, an Existing Restricted Name
Agreement or a Company License Agreement Restriction Agreement; or (iii) enter
into a DTR License with a Specialty Retail Store without complying with the
restrictions contained in Section 6.2.2 of the License and Conduct of Business
Agreement, as if it were the first contract year thereunder and the Company were
the "Licensee" thereunder, subject to the exclusions contained in Section 6.2.4
of the License and Conduct of Business Agreement, and DEI further acknowledges
and agrees that any such DTR License entered into from the date hereof to the
Closing Date shall be taken into account in determining the compliance of TDS
Franchising and its Affiliates with the provisions of Section 6.2.2 of the
License and Conduct of Business Agreement, as applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Capitalization, Financing and Liquidity of
Buyer and TCP</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Capitalization
and Financing</U>. No later than five (5) Business Days prior to the Closing
Date, Buyer shall deliver to DEI and Seller a list setting forth (a)&#160;all
Outstanding TCP Securities as of the Closing Date, (b)&#160;to Buyer's
Knowledge, the names of the beneficial holders of five percent (5%) or more of
such Outstanding TCP Securities and the amount of Outstanding TCP Securities
held by each such beneficial holder, and (c) if applicable, Buyer's and TCP's
anticipated sources of other funds to acquire the Membership Units and the
Shares and pay all other amounts required to be paid by Buyer and/or TCP under
this Agreement, the Related Agreements, the Acquisition Agreement Guarantee and
the TCP Guaranty and Commitment, including the identity of each such source, the
amount to be funded by each such source and a summary of the material terms and
conditions on which Buyer or TCP will obtain such funds (such list, <B>"Buyer's
Closing Capitalization Table"</B>). Buyer's Closing Capitalization Table shall,
with respect to the information required under subparagraphs&#160;(a) and (b) of
this Section 6.4.1, show changes to such information from the information set
forth on <U>Buyer Schedule 5.1.5(a)</U> and, with respect to the information
required under subparagraph&#160;(c) of this Section 6.4.1, show changes to such
information from the information set forth on <U>Buyer Schedule 5.4</U>. As of
the Closing Date, Buyer's Closing Capitalization Table as so delivered to DEI
and Seller shall remain true, correct and accurate. As of the Closing Date,
neither Buyer nor TCP shall accept or use, nor permit its Affiliates to accept
or use, any funds contributed, provided or otherwise made available to Buyer,
TCP or any of its Affiliates by any Disqualified Person, directly or indirectly,
in connection with the acquisition of the Membership Units or the Shares or the
payment of other amounts required to be paid by Buyer and/or TCP under this
Agreement, the Related Agreements, the Acquisition Agreement Guarantee and the
TCP Guaranty and Commitment. To the extent the information in Buyer's Closing
Capitalization Table differs in any material respect from that set forth on
<U>Buyer Schedule </U>5.1.5(a) or <U>Buyer Schedule 5.4</U>, Buyer's Closing
Capitalization Table shall be subject to the approval of DEI and Seller in their
respective sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Liquidity
Plan</U>. No later than five (5) Business Days prior to the Closing Date, Buyer
shall deliver to DEI and Seller a list setting forth, as the following will
exist as of the Closing Date, Buyer's good faith estimate of its and TCP's
internal and external sources of liquidity for a period of two (2) years
following the Closing Date, including a reasonably detailed description of the
provider, type, material terms and amount of each such source of liquidity
(<B>"Buyer's Liquidity Plan"</B>). Buyer's Liquidity Plan shall show changes to
such information from the information set forth on <U>Buyer Schedule 5.4</U>. As
of the Closing Date, Buyer's Liquidity Plan as so delivered to DEI and Seller
shall remain true, correct and accurate. Neither Buyer nor TCP shall accept or
use, nor permit its Affiliates to accept or use, any funds contributed, provided
or otherwise made available to Buyer, TCP or any of its Affiliates by any
Disqualified Person, directly or indirectly, in connection with Buyer's
Liquidity Plan or otherwise in connection with the Business. To the extent the
information in Buyer's Liquidity Plan differs in any material respect from that
set forth on <U>Buyer Schedule 5.4</U>, Buyer's Liquidity Plan shall be subject
to the approval of DEI and Seller in their respective sole discretion.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Buyer's
Governing Documents</U>. Buyer hereby agrees to make (or, as applicable, to
cause its Affiliates to make) all amendments, modifications or other changes to
Buyer's Governing Documents (regardless of whether such documents were provided
to DEI and Seller prior to the date hereof pursuant to Section 5.1.6) necessary
to cause all of Buyer's Governing Documents to comply in all respects with the
provisions of the License and Conduct of Business Agreement. Not later than ten
(10) Business Days prior to the Closing Date, Buyer shall deliver to DEI and
Seller drafts of all of Buyer's Governing Documents, as revised (as applicable)
to comply in all respects with the provisions of the License and Conduct of
Business Agreement. DEI and Seller shall have the right to review and comment on
all provisions of Buyer's Governing Documents, which comments shall be
considered by Buyer in good faith, and the final versions of all of Buyer's
Governing Documents (regardless of whether such documents were provided to DEI
and Seller prior to the date hereof pursuant to Section 5.1.6) shall be subject
to the approval of DEI and Seller in their respective sole discretion. As of the
Closing Date, Buyer's Governing Documents as approved by DEI and Seller in their
respective sole discretion pursuant to this Section 6.4.3 shall remain true,
correct and accurate. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notification of Certain Matters</U>. DEI and
Seller shall give prompt notice to Buyer, and Buyer shall give prompt notice to
DEI and Seller, of (i)&#160;the occurrence, or failure to occur, of any event
that would be likely to cause any representation or warranty by such party
contained in this Agreement to be untrue or inaccurate (a) in the case of DEI
and Seller in a manner that would cause a Material Adverse Event
(<U>provided</U>, <U>that</U>, any representation or warranty of DEI and Seller
contained herein that is already qualified by "materiality" or "Material Adverse
Event" shall be deemed to be not so qualified for purposes of this Section 6.5,
so that there will be no duplication between such qualifier contained within
such representation or warranty and the "Material Adverse Event" qualifier in
this clause) or (b) in the case of Buyer, in any material respect
(<U>provided</U>, <U>that</U>, any representation or warranty of Buyer contained
herein that is already qualified by "materiality" shall be deemed not to be so
qualified for purposes of this Section 6.5, so that there will be no duplication
between such qualifier contained within such representation or warranty and the
"in any material respect" qualifier contained in this clause) and (ii)&#160;any
failure of such party to comply with or satisfy, in any material respect, any
covenant or condition to be complied with or satisfied by it under this
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Permits and Consents</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Permits</U>.
DEI, Seller and Buyer each agree to cooperate and use their commercially
reasonable efforts to obtain (and will promptly prepare all registrations,
filings, applications, requests and notices relating to) all Permits that may be
necessary to consummate the transactions contemplated by this Agreement.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Consents</U>.
To the extent that the Consent of a third Person with respect to any Material
Contract or Employment Contract is required in connection with the transactions
contemplated by this Agreement, DEI, Seller and Buyer shall use their
commercially reasonable efforts (other than the expenditure of money or, unless
otherwise agreed to by the parties hereto or otherwise permitted by this
Agreement, any amendment or modification of any such Contract) to obtain such
Consent prior to the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effect of
Failure to Obtain Permits or Consents</U>. The failure by DEI, Seller or Buyer
to obtain one (1) or more Permits or Consents of third Persons with respect to
any Material Contracts or Employment Contracts in connection with the
transactions contemplated hereby shall not constitute a breach of this Agreement
by DEI, Seller or Buyer for any purpose (including, without limitation, for
purposes of Sections 9.1.2, 9.1.3, 9.1.4 and 9.1.5), and, except as set forth in
Section 8.1.2, no such failure by DEI, Seller or Buyer shall relieve any party
of its obligation to effect the Closing as contemplated herein. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Lease Matters</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Landlord Consents</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>Cooperation to Obtain Consents</U>. To the extent the
Consent of a third Person with respect to any Lease is required in connection
with the transactions contemplated by this Agreement (as indicated on the
Acquired Stores Schedule), DEI and Seller shall, and shall cause their
Affiliates to, and Buyer shall, use their commercially reasonable efforts to
obtain such Consent prior to the Closing Date, with the scheduling, organizing
and conducting of all negotiations in connection therewith to be determined by
DEI and Buyer in good faith consultation and cooperation with one another,
<U>provided</U>, that Buyer shall use its best efforts to ensure that no
substantive communications or negotiations pertaining to any such Lease or
Consent shall occur between Buyer or any of its Affiliates and any Landlord
without either (A) the participation of a duly authorized representative of DEI
or any of its Affiliates or (B) the express prior written consent of one (1) of
the Seller Consent Officers (whether such written consent has been given prior
to, or is given after, the date hereof), which consent (i) may relate either to
a particular communication or to a process by which certain communications may
occur, (ii) may be granted or withheld in the business judgment of the
applicable Seller Consent Officer, and (iii) may be provided by any Seller
Consent Officer via email or in any other written format. Without limiting the
foregoing, Buyer's cooperation hereunder shall include promptly delivering to
DEI all information regarding Buyer, TCP and their respective Affiliates,
Subsidiaries, officers, directors and employees as may be reasonably requested
by, and upon reasonable notice making its and TCP's officers, directors and
employees available to, DEI, Seller, the Landlords and/or their respective
lenders. If at any time prior to the Closing Date either party obtains Knowledge
that any of the Acquired Stores has been or will be leased by the Landlord to an
unrelated third party, the party obtaining such Knowledge shall promptly inform
the other party thereof.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;<U>Lease Amendments and New Leases</U>. In the event that, in
connection with obtaining any Consent that is required with respect to any Lease
in connection with the transactions contemplated by this Agreement (as indicated
on the Acquired Stores Schedule), it becomes necessary for TDS USA, TDS Canada
and/or Buyer or its Affiliates to renew, extend, amend or modify any Acquired
Lease or to enter into any new lease or sublease or take assignment of any lease
or sublease for an Acquired Store (for purposes of this Section 6.7.1, each such
new or assigned lease or sublease for an Acquired Store is referred to as a
<B>"New Lease"</B>) or to agree to do any of the foregoing, each such New Lease
or renewal, extension, amendment or modification of an Acquired Lease shall be
subject to the consent of each of DEI and Buyer, such consent not to be
unreasonably withheld, conditioned or delayed. Notwithstanding the foregoing,
(A) DEI acknowledges and agrees that, if any such New Lease or renewal,
extension, amendment or modification of an Acquired Lease shall by its terms not
take effect unless and until the Closing Date shall have occurred, Buyer and its
Affiliates shall consult with DEI in connection with such New Lease or renewal,
extension, amendment or modification of an Acquired Lease, but DEI's consent
shall not be required with respect thereto and Buyer may cause New TDS LLC to
enter into such New Lease or renewal, extension, amendment or modification, to
be effective contingent upon the consummation of the transactions contemplated
hereby, (B) Buyer acknowledges that it does not possess the authority to enter
into, or to cause New TDS LLC or any of Buyer's Affiliates to enter into, any
New Lease or renewal, extension, amendment or modification of an Acquired Lease
that would become effective prior to the Closing Date, and (C) Buyer
acknowledges and agrees that it shall not in any event withhold its consent to
any New Lease or any renewal, extension, amendment or modification of any
Acquired Lease on the grounds that such New Lease or renewal, extension,
amendment or modification would:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) with respect to Core Stores only, establish
(in the case of a New Lease) or extend, amend or modify (in the case of a
renewal, extension, amendment or modification of an Acquired Lease) the term of
such New Lease or Acquired Lease, so long as (x) with respect to a number of
Core Stores not exceeding ten percent (10%) of the total number of Core Stores,
such term does not extend for more than ten (10) years after the Closing Date
(but with no minimum length of term requirement) and (y) with respect to the
remainder of the Core Stores, such term extends for at least seven (7) years and
for not more than ten (10) years after the Closing Date; and (B) with respect to
Non-Core Stores, establish (in the case of a New Lease) or extend, amend or
modify (in the case of a renewal, extension, amendment or modification of an
Acquired Lease) the term of such New Lease or Acquired Lease, so long as (x)
with respect to a number of Non-Core Stores not exceeding ten percent (10%) of
the total number of Non-Core Stores, such term does not extend for more than
five (5) years after the Closing Date (but with no minimum length of term
requirement) and (y) with respect to the remainder of the Non-Core Stores, the
term shall be subject to the consent of each of DEI and Buyer, such consent not
to be unreasonably withheld, conditioned or delayed, as provided above in this
Section 6.7.1(b);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;impose or increase base rent
and/or percentage rent (or any comparable rent payment under a different name)
due under such New Lease or Acquired Lease after the Closing (the amount of such
new base rent and/or percentage rent, the <B>"New Rent Requirements"</B> and the
Acquired Stores leased pursuant to the New Leases and/or Acquired Leases under
which New Rent Requirements are imposed or increased pursuant to this Section
6.7.1(b), the <B>"New Rent Acquired Stores"</B>), so long as the aggregate
annual amount of base rent and percentage rent payable under all New Leases and
Acquired Leases for the New Rent Acquired Stores (with any such percentage rent
to be an amount calculated using the Lease Sales Amount for each such New Rent
Acquired Store and the applicable percentage rent formula under such New Lease
or Acquired Lease as if it had been in effect in Fiscal Year 2003) does not
exceed an amount equal to one hundred thirty percent (130%) of (A) the sum of
the Lease Base Rent Amounts for such New Rent Acquired Stores, <U>plus</U> (B)
the sum of the Lease Percentage Rent Amounts for such New Rent Acquired Stores;
<U>provided</U>, <U>that</U>, with respect to Non-Core Stores, the foregoing
provisions of this subparagraph (ii) of this Section 6.7.1(b) shall only apply
to a number of Non-Core Stores not exceeding ten percent (10%) of the total
number of Non-Core Stores, and, with respect to the remainder of the Non-Core
Stores, the New Rent Requirements shall be subject to the consent of each of DEI
and Buyer, such consent not to be unreasonably withheld, conditioned or delayed,
as provided above in this Section 6.7.1(b); and/or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;impose or increase capital expenditure
requirements under such New Lease or Acquired Lease after the Closing (the
amount of such new capital expenditure requirements, the <B>"New Capital
Expenditure Requirements"</B>), so long as (A) such New Lease or Acquired Lease has
a term of at least seven (7) years, (B) any New Capital Expenditure Requirements
associated with any required renovation, remodel or build-out of an Acquired
Store do not exceed $650,000 for any single Acquired Store and (C) the Company
shall have a period of not less than one (1) year after the Closing Date to
complete any required renovation, remodel or build-out of such Acquired Store.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Consent Fees</U>. In the event that, in
connection with obtaining any Consent that is required with respect to any Lease
in connection with the transactions contemplated by this Agreement (as indicated
on the Acquired Stores Schedule), any third party shall require, or condition
its Consent upon, payment of a Consent Fee, DEI and Seller shall determine in
their respective sole discretion whether to pay such Consent Fee and, if DEI and
Seller determine to pay such Consent Fee, the payment thereof shall be the sole
responsibility of DEI and/or Seller; <U>provided</U>, <U>that</U>, Buyer shall
have the right, in its sole discretion, as provided in Section 6.7.2(a)(i), to
pay any such Consent Fee within five (5) Business Days after DEI provides notice
to Buyer that DEI and Seller have elected not to pay such Consent Fee.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Release from U.K. Lease Guarantees</U>. DEI
and Seller shall use, and shall cause their Affiliates to use, commercially
reasonable efforts to facilitate the release of TDS USA from the U.K. Lease
Guarantees, <U>provided</U>, <U>that</U>, such efforts shall not include
providing substitute guarantors, security deposits, stand-by letters of credit
or other credit enhancement devices in connection therewith. If TDS USA is not
released from any U.K. Lease Guarantees prior to the Closing, DEI and Seller
shall indemnify and hold Buyer and its Affiliates harmless from and against any
and all Loss arising directly or indirectly from, out of or based on the U.K.
Lease Guarantees.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Changes to
Acquired Stores Schedule and Disney Retained Stores Schedule</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
&nbsp;&nbsp;&nbsp;&nbsp;<U>Deletions from Acquired Stores Schedule</U>. In the
event that (i) any third Person, with respect to any Acquired Lease for which
the Consent of such Person is required hereunder (as indicated on the Acquired
Stores Schedule), conditions its Consent upon terms that are not acceptable to
DEI or Seller in its respective business judgment (unless either (1) such terms
consist of the payment of a penalty, fee or other charge that, within five (5)
Business Days after notice thereof from DEI to Buyer, Buyer elects, in its sole
discretion, to cause TCP to pay on behalf of DEI or Seller or (2) such terms
consist of changes to the applicable Lease that would not be obligations of DEI,
Seller or their Affiliates following the Closing and, within five (5) Business
Days after notice thereof from DEI to Buyer, Buyer has consented thereto in
accordance with Section 6.7.1(b)), (ii) any Acquired Lease expires pursuant to
its terms prior to the Closing Date and the Company is not able to continue its
tenancy thereunder on a month-to-month basis upon terms that are acceptable to
DEI or Seller in its respective business judgment, including, without
limitation, the absence of any penalty, fee or other charge, including
incremental, additional holdover rent (unless, within five (5) Business Days
after notice thereof from DEI to Buyer, Buyer elects, in its sole discretion, to
cause TCP to pay any such penalty, fee or other charge, including incremental,
additional holdover rent, on behalf of DEI or Seller), or (iii) DEI or Seller
otherwise determines that any particular Acquired Lease should not be included
among the assets of the Company in connection with the Membership Unit
Acquisition and/or the Share Acquisition because, in DEI's or Seller's judgment
in its respective sole discretion, it has become impractical for any other
reason to obtain the Consent of the Landlord thereunder, then DEI and Seller
shall have the right (x) in the case of subparagraph (i) or (iii) above, to
amend the Acquired Stores Schedule to remove therefrom the Store leased under
such particular Lease and, unless added to the Deferred Stores Schedule pursuant
to Section 6.7.3(a), amend the Disney Retained Stores Schedule to add thereto
the Store leased under such particular Lease and (y) in the case of subparagraph
(ii) above, to amend the Acquired Stores Schedule to remove therefrom the Store
leased under such particular Lease and to terminate operations at such Store.
Stores that are removed from the Acquired Stores Schedule and added to the
Disney Retained Stores Schedule pursuant to this Section 6.7.2(a) are referred
to herein as <B>"Non-Transferable Stores,"</B> and Stores that are removed from
the Acquired Stores Schedule as a result of the circumstances described in
subparagraph (ii) above are referred to herein as <B>"Expired Lease Stores."</B>
Nothing in this Section 6.7.2(a) shall limit the rights of DEI and Seller to add
any Stores removed from the Acquired Stores Schedule as a result of the
circumstances described in subparagraph (i) or (iii) above to the Deferred
Stores Schedule pursuant to Section 6.7.3(a) rather than to the Disney Retained
Stores Schedule pursuant to this Section 6.7.2(a), and any election as to the
schedule to which any particular Acquired Store shall be added shall be made by
DEI and Seller in their respective sole discretion.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effective Date of Amendments to Acquired Stores
Schedule or Disney Retained Stores Schedule; Termination of Certain Leases</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On the Monday of each week,
beginning on the Monday following the first full week after the date hereof, DEI
and Seller shall give written notice to Buyer of any amendments to be made to
the Acquired Stores Schedule or the Disney Retained Stores Schedule pursuant to
this Section 6.7.2 during the preceding week. Any such amendments to the
Acquired Stores Schedule or the Disney Retained Stores Schedule shall
automatically become effective on the third (3rd) Business Day following the
giving of such written notice by DEI and Seller to Buyer (<U>provided</U>, that
(i) if the Closing Date falls on a day that is before the third (3rd) Business
Day following the giving of any such notice pursuant to this Section 6.7.2(b),
then any such amendments to the Acquired Stores Schedule or the Disney Retained
Stores Schedule shall automatically become effective on the date that is two (2)
Business Days before the Closing Date and (ii) DEI and Seller shall be entitled
to give Buyer a final written notice pursuant to this Section 6.7.2(b) on the
date that is two (2) Business Days before the Closing Date, and any such
amendments to the Acquired Stores Schedule or the Disney Retained Stores
Schedule contained in such notice shall automatically become effective on such
date). Notwithstanding anything herein to the contrary, the failure by DEI or
Seller to give any written notice to Buyer pursuant to this Section 6.7.2(b)
shall not constitute a breach of this Agreement by DEI or Seller for any purpose
(including, without limitation, for purposes of Sections 9.1.3, 9.1.4 and
9.1.5).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEI and Seller shall be
entitled to terminate (and/or to cause TDS USA or TDS Canada, as applicable, to
terminate) any Disney Retained Lease; <U>provided</U>, <U>that</U>, in the event
that a Signing Date Acquired Store that is a Core Store is added to the Disney
Retained Stores Schedule pursuant to this Section 6.7.2, DEI and Seller shall
not terminate (or permit TDS USA or TDS Canada to terminate) the Lease relating
to such Store or terminate operations at such Store until the tenth (10th)
Business Day following the effective date of the amendment to the Disney
Retained Stores Schedule pursuant to which such Store is added to the Disney
Retained Stores Schedule (or, if earlier, on the date that is two (2) Business
Days before the Closing Date) and, upon Buyer's request, DEI shall consult with
Buyer during such time period regarding obtaining any required Consent under the
Lease for such Core Store rather than terminating such Lease (<U>provided</U>,
<U>that</U>, DEI shall have no obligation whatsoever to gree to any terms
proposed by Buyer).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEI and Seller shall not
terminate (and shall not permit TDS USA or TDS Canada, as applicable, to
terminate) any Lease that is not a Disney Retained Lease without the prior
written consent of Buyer (which consent shall not be unreasonably withheld,
conditioned or delayed); <U>provided</U>, <U>that</U>, the foregoing shall not
otherwise limit any other rights of DEI or Seller under this Agreement
(including, without limitation, under this Section 6.7.2).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effect of Failure to Obtain Lease Consents</U>.
Provided that DEI and Seller shall have complied with their obligation to
exercise commercially reasonable efforts to obtain the Consents required with
respect to the Leases in connection with the transactions contemplated hereby
(as indicated on the Acquired Stores Schedule) pursuant to Section 6.7.1(a), the
failure by DEI or Seller to obtain one (1) or more Consents with respect to any
Lease or Leases in connection with the transactions contemplated hereby shall
not constitute a breach of this Agreement by DEI or Seller for any purpose
(including, without limitation, for purposes of Sections 9.1.3, 9.1.4 and
9.1.5), and, except as set forth in Sections 8.2.2 and 8.3.2, no such failure by
DEI or Seller shall relieve any party of its obligation to effect the Closing as
contemplated herein.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.7.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsequent Closing for Deferred Leases</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Deferred Leases</U>. In the event that, upon
satisfaction or waiver of all of the conditions set forth in Article VIII
(including the conditions set forth in Sections 8.2.2 and 8.3.2 with respect to
the minimum number of Consent Required Core Stores), any Consents of third
Persons required to be obtained in connection with the transactions contemplated
by this Agreement pursuant to the terms of any particular Acquired Leases (as
indicated on the Acquired Stores Schedule) have not been obtained, the Closing
shall occur in accordance with the provisions of Section 3.1, <U>provided</U>,
that (a) the Acquired Stores Schedule shall be amended (but not earlier than two
(2) Business Days before the Closing Date) to remove therefrom the Store(s)
leased under such particular Lease(s) and such Store(s) shall be added to the
Deferred Stores Schedule (unless previously transferred to the Disney Retained
Stores Schedule pursuant to Section 6.7.2(a)), and (b) in addition to the
Retained Assets, Seller shall cause TDS USA to distribute to Seller in
connection with the LLC Distribution, and DEI shall cause TDS Canada to Transfer
to Canadian Transferee in connection with the Canadian Transfer, those Acquired
Leases as to which Consents of third Persons are required to be, but as of the
date that is two (2) Business Days before the Closing Date have not been,
obtained (such Acquired Leases are referred to herein as <B>"Deferred
Leases"</B>) and all properties, assets, rights, liabilities and obligations
relating to the conduct and operation of the Business pertaining to the Deferred
Stores.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsequent Closing Period</U>. In the event
there are Deferred Leases upon the Closing, during the period commencing on the
Closing Date and ending on the earlier to occur of (i) the date that is four (4)
months after the Closing Date and (ii) the date on which all Consents required
from third Persons with respect to the Deferred Leases, if any, shall have been
obtained (such period, if applicable, the <B>"Subsequent Closing Period,"</B>
<U>provided</U>, <U>that</U>, there shall be no Subsequent Closing Period if
there are no Deferred Leases upon the Closing), DEI, Seller and Buyer shall
continue to use their commercially reasonable efforts to obtain any Consents
required from third Persons with respect to the Deferred Leases in connection
with the transactions contemplated by this Agreement (as indicated on the
Acquired Stores Schedule) as set forth in and in accordance with the terms of
Section 6.7.1 (including Section 6.7.1(b)); <U>provided</U>, that if at any time
during the Subsequent Closing Period DEI or Seller determines, in its respective
sole discretion, that obtaining a Consent for any particular Deferred Lease has
become impractical, then, upon five (5) Business Days written notice from DEI to
Buyer (during which period DEI shall, upon Buyer's request, consult with Buyer
regarding such Deferred Lease), DEI and Seller may cease pursuing such Consent.
When the requisite Consents with respect to any Deferred Lease have been
obtained, the Deferred Stores Schedule shall be amended to remove therefrom the
Store leased under such particular Deferred Lease and such Store shall be added
to the Approved Deferred Stores Schedule. Within two (2) Business Days after the
end of each calendar month during the Subsequent Closing Period and within five
(5) Business Days after the last day of the Subsequent Closing Period, DEI and
Seller shall give written notice to Buyer of any Deferred Leases with respect to
which the requisite Consents have been obtained and of any amendments to the
Approved Deferred Stores Schedule pursuant to this Section 6.7.3 (all such
Deferred Leases as to which such Consents are obtained, collectively, the
<B>"Approved Deferred Leases"</B>).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Approved Deferred Stores Schedule and
Subsequent Closing Balance Sheet</U>. No later than fifteen (15) Business Days
after the last day of the Subsequent Closing Period, DEI and Seller shall
deliver to Buyer (i) the Approved Deferred Stores Schedule, (ii) DEI's and
Seller's good faith estimated unaudited balance sheet reflecting the assets and
liabilities of Seller and Canadian Transferee relating solely to the Approved
Deferred Stores, including, without limitation, the Approved Deferred Leases and
Store-Related Assets and Liabilities, as of the Subsequent Closing Date (the
<B>"Subsequent Closing Balance Sheet"</B>), and (iii) a letter certifying as to
DEI's and Seller's good faith calculation of the Estimated Subsequent Closing
Working Capital Adjustment Amount. The Subsequent Closing Balance Sheet shall be
prepared in substantially the same manner and form as the Pro Forma Balance
Sheet (including the application of Modified GAAP), except for adjustments made
to limit the Subsequent Closing Balance Sheet to the Approved Deferred Stores in
accordance with the Store Adjustment Methodology.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsequent Closing; Deliveries</U>. The
closing with respect to all Approved Deferred Leases (the <B>"Subsequent
Closing"</B>) will take place as soon as reasonably practicable, and in any
event within five (5) Business Days, following the delivery by DEI and Seller to
Buyer of the Approved Deferred Stores Schedule, the Subsequent Closing Balance
Sheet and any other items required by Section 6.7.3(c). At the Subsequent
Closing:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Seller shall
deliver, and DEI shall cause Canadian Transferee to deliver, to Buyer the
Deferred Lease Assignment and Assumption Agreement (which shall include a
bring-down to the Subsequent Closing Date of the representations and warranties
contained in subparagraphs (a), (b), (c), (d) and (f) of Section 4.6.1 with
respect to the Approved Deferred Stores only), Transferring the Approved
Deferred Leases and Store-Related Assets and Liabilities to TDS USA and/or TDS
Canada, as applicable, duly executed by Seller and Canadian Transferee;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall
deliver to Seller and Canadian Transferee the Deferred Lease Assignment and
Assumption Agreement, duly executed by TDS USA and/or TDS Canada, as applicable;
and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;any Deferred
Stores that are not Approved Deferred Stores as of the Subsequent Closing Date
shall be deemed to be Disney Retained Stores.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Survival of
Section 6.7</U>. The provisions of this Section 6.7 shall survive the Closing
until the Subsequent Closing Date or, if no Subsequent Closing occurs, until
expiration of the Subsequent Closing Period. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Regulatory Filings and Deliveries</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Hart-Scott-Rodino
Act</U>. DEI, Seller and Buyer will, or, as applicable, will cause their
respective ultimate parent entities to, promptly make any and all filings
required to be made under the Hart-Scott-Rodino Act in connection with the
transactions contemplated hereby, to the extent not already made. DEI, Seller
and Buyer shall furnish to each other such necessary information and reasonable
assistance as the other may request in connection with its preparation of
necessary filings or submissions under the provisions of the Hart-Scott-Rodino
Act. The parties hereby acknowledge that, as of the date hereof, each has
received notice that early termination of the waiting period under the
Hart-Scott-Rodino Act has been granted with respect to the transactions
contemplated by this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Investment
Canada Act</U>. Buyer will, or, as applicable, will cause its Affiliates to,
promptly make any and all filings required to be made under the Investment
Canada Act in connection with the transactions contemplated hereby. Buyer will,
or, as applicable, will cause its Affiliates to, cooperate and negotiate
reasonably and in good faith with Heritage Canada and comply with all reasonable
requests of Heritage Canada. Upon Buyer's request, Seller, DEI and TDS Canada
will provide reasonable cooperation to Buyer in connection with filings under
the Investment Canada Act and in connection with any reasonable requests of
Heritage Canada, provided that Buyer shall reimburse DEI, Seller and TDS Canada,
as applicable, for any out-of-pocket expenses (excluding fees and expenses of
attorneys and any filing fees under the Investment Canada Act, which are
addressed in Section 11.12) reasonably incurred by DEI, Seller or TDS Canada, as
applicable, in connection with providing such cooperation to Buyer. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Competition
Act</U>. DEI, Seller and Buyer agree and acknowledge that the transactions
contemplated hereby are not "pre-notifiable" under the Competition Act.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Franchise
Information</U>. At least twenty (20) Business Days prior to the Closing Date,
DEI and/or Seller shall deliver to Buyer (a) the Uniform Franchise Offering
Circular pertaining to TDS USA and (b) the information pertaining to TDS Canada
that is necessary to comply with Canadian franchise Law applicable to TDS Canada
and, at least five (5) Business Days prior to the Closing Date, Buyer shall
deliver to DEI and Seller a written letter, in form and substance reasonably
satisfactory to DEI and Seller, confirming that Buyer and its Affiliates have
had at least ten (10) Business Days to review and ask questions regarding such
Uniform Franchise Offering Circular and such information pertaining to TDS
Canada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Retained Asset Agreements</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>General</U>.
TDS USA and/or TDS Canada are currently parties to certain Contracts that
constitute a portion of, or relate directly and primarily to, the Retained
Assets (collectively, the <B>"Retained Asset Agreements"</B>), including,
without limitation, the following: (i) the Agreement among TDS USA, Retail
Networks Co., Ltd. (<B>"RNC"</B>) and Oriental Land Co., Ltd. (<B>"OLC"</B>)
with respect to the operation of The Disney Store Japan (<B>"TDS Japan"</B>)
dated April 1, 2002 (as amended, the <B>"TDSJ License Agreement"</B>); (ii) the
Information Technology Services Agreement among TDS USA, RNC and OLC dated April
1, 2002 (as amended, the <B>"TDSJ IT Services Agreement"</B>); (iii) the Amended
and Restated Credit Card Program Agreement between TDS USA and Monogram Credit
Card Bank of Georgia (<B>"Monogram"</B>) dated as of February 11, 1994 (as
amended, the <B>"Monogram Agreement"</B>); (iv) the Buying Agency Agreement
among TDS USA, Disney Worldwide Services, Inc. (<B>"DWS"</B>), Disneyland
Merchandise Importing (<B>"DLMI"</B>), Walt Disney Parks and Resorts, LLC
(<B>"WDPR"</B>) and Li &amp; Fung (Trading) Limited (<B>"Li &amp; Fung"</B>)
entered into as of October 1, 2001 (as amended, the <B>"Li &amp; Fung
Agreement"</B>); (v) the Buying Agency Agreement among TDS USA, DWS and NAP,
Inc. (<B>"NAP"</B>) dated April 8, 2003 (as amended, the
<B>"NAP Agreement"</B>); (vi) the Buying Agency Agreement among TDS
USA, DWS, DLMI, WDPR and Ocean Sky International Enterprise Limited
(<B>"Ocean Sky"</B>) dated as of August 27, 2002 (as amended, the
<B>"Ocean Sky Agreement"</B>); (vii)&#160;the Standard Chartered
Facility; and (viii)&#160;the other Contracts set forth on <U>TDS Schedule
1.1(d)</U>. For purposes of clarification, the Retained Asset Agreements
consisting of Contracts pertaining to Disney Information Technology or Non-IT
Intellectual Property are separately addressed in Sections 4.7 and 7.8. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Pre-Closing
Obligations Regarding Certain Retained Asset Agreements</U>. DEI and Seller
agree that they shall use their commercially reasonable efforts (other than the
expenditure of money or, except as DEI or Seller may determine in its respective
sole discretion, the amendment or modification of any of the following Retained
Asset Agreements) to do the following prior to the Closing: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;with respect to the TDSJ License Agreement and
the TDSJ IT Services Agreement, assign TDS USA's obligations thereunder to DEI
or one of its Affiliates (other than the Company) and obtain the Consent of RNC
and OLC to such assignment;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;with respect to the Monogram Agreement, (i)
assign TDS USA's obligations thereunder to DEI or one of its Affiliates (other
than the Company) and obtain the Consent of Monogram to such assignment, and
(ii) cause TDS USA to enter into a Monogram Participation Agreement to be
effective as of the Closing Date (and DEI and Seller shall provide a copy
thereof to Buyer);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;with respect to the Li &amp; Fung Agreement,
amend such agreement so that TDS USA is no longer a party thereto and, to the
extent reasonably requested by Buyer, arrange for an introduction of Buyer to Li
&amp; Fung in order to enable Buyer, TDS USA and/or TDS Canada to enter into a
new agreement with Li &amp; Fung pertaining to the Business; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;with respect to the NAP Agreement, the Ocean
Sky Agreement and the Standard Chartered Facility, amend each such agreement so
that TDS USA is no longer a party thereto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Other
Retained Asset Agreements</U>. DEI and Seller agree that they shall use their
commercially reasonable efforts (other than the expenditure of money or, except
as DEI or Seller may determine in its respective sole discretion, the amendment
or modification of any of the Retained Asset Agreements) prior to the Closing to
obtain any Consent or take such other action as may be necessary to distribute
to Seller in connection with the LLC Distribution or Transfer to Canadian
Transferee in connection with the Canadian Transfer any other Retained Asset
Agreements not specifically referenced in Section 6.9.2 or to assign any such
other Retained Asset Agreements to DEI or any of its Affiliates (other than the
Company). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effect of
Failure to Assign or Amend Retained Asset Agreements</U>. The parties agree that
the failure by DEI or Seller to assign, distribute, amend or obtain any Consent
required under any Retained Asset Agreement in connection with the transactions
contemplated hereby shall not constitute a breach of this Agreement by DEI or
Seller for any purpose (including, without limitation, for purposes of Sections
9.1.3, 9.1.4 and 9.1.5), and no such failure by DEI or Seller shall relieve
Buyer of its obligation to effect the Closing as contemplated herein. The
parties further agree that, if any Retained Asset Agreements are not distributed
to Seller in connection with the LLC Distribution, Transferred to Canadian
Transferee in connection with the Canadian Transfer or assigned to DEI or any of
its Affiliates (other than the Company) as of the Closing Date, the parties
shall be required to perform their respective obligations with respect to such
Retained Asset Agreements as set forth under Section 7.5 (provided that, in such
event, DEI or Seller shall provide Buyer with a copy of any such Retained Asset
Agreement). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Participation Agreements</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.10.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>General</U>.
DEI and/or its Affiliates (other than the Company) are currently parties to
certain Contracts in which TDS USA and/or TDS Canada participate or under which
TDS USA and/or TDS Canada are third party beneficiaries or otherwise derive
benefit (collectively, the <B>"Participation Agreements"</B>), including,
without limitation, the American Express Card Service Agreement dated September
12, 2003 between American Express Travel Related Services Company, Inc.
(<B>"Amex"</B>) and DWS (as amended, the <B>"Amex Agreement"</B>), the Canada
Mastercard Agreement, the ValueLink Agreement and the Disney Supply Chain
Arrangements. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Negotiations
Regarding the Amex Agreement, the Canada Mastercard Agreement and Other Credit
and Charge Card Agreements</U>. DEI and Seller agree that, prior to the Closing,
Buyer shall be entitled, in its sole discretion, to negotiate with (i) Amex with
respect to an agreement pursuant to which the Company would be entitled to
accept Amex credit and charge cards following the Closing, (ii) Bank of Montreal
(or another servicing bank) with respect to an agreement pursuant to which the
Company would be entitled to accept Mastercard credit and charge cards in Canada
following the Closing and/or (iii) subject to Section 6.11.9 and DEI and
Seller's determination of the status of SunTrust and the SunTrust Agreement
thereunder, one (1) or more additional servicing banks with respect to one (1)
or more agreements pursuant to which the Company would be entitled to accept
Visa, Mastercard, Discover or other major credit or charge cards in the United
States or Canada following the Closing (as and to the extent necessary to ensure
that the Company will be in a position to accept such credit and charge cards),
<U>provided</U> that, in the case of each of subparagraphs (i), (ii) and (iii)
of this Section 6.10.2: (A) such agreement shall become effective only after the
Closing, (B) Buyer shall provide DEI with each draft of such agreement that is
distributed between the parties thereto (redlined to reflect changes therein)
and shall consider in good faith any comments made by DEI with respect to such
drafts, and (C) Buyer shall not, and shall not permit the Company or its
Affiliates to, enter into such agreement unless the final version thereof has
been approved in writing by DEI in its business judgment, such approval or
disapproval to be communicated to Buyer within five (5) Business Days after such
final version is provided to DEI (<U>provided</U>, <U>that</U> such approval
shall be in DEI's sole discretion with respect to any terms or conditions
that relate to any matters that may, as determined by DEI in its sole
discretion, be expected to violate, constitute a default under or breach in any
material respect, or, even if not constituting an actual violation, default or
breach, may be expected to materially conflict with or impair the rights,
benefits or value accruing to DEI or its Affiliates under or in connection with,
this Agreement, the License and Conduct of Business Agreement, any other Related
Agreement, the TCP Guaranty and Commitment, the Intellectual Property of DEI or
any of its Affiliates, and/or any material Contract to which any of DEI or its
Affiliates is a party or under which any of DEI's or its Affiliates'
properties or assets are bound, including, without limitation, Contracts and
strategic alliances between DEI or its Affiliates and Visa USA, Bank One, N.A.
and/or their respective Affiliates). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.10.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>ValueLink
Agreement</U>. DEI and Seller agree that they shall use their commercially
reasonable efforts (other than the expenditure of money or, except as DEI or
Seller may determine in its respective sole discretion, the amendment or
modification of the ValueLink Agreement) to cause TDS USA (and, as applicable as
determined by DEI in its sole discretion, TDS Canada) to enter into a ValueLink
Participation Agreement to be effective as of the Closing Date (and DEI and
Seller shall provide a copy thereof to Buyer). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.10.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Rights
Under Participation Agreements</U>. Buyer acknowledges and agrees that,
following the Closing, except as set forth in Section 6.11.3 with respect to the
Disney Supply Chain Arrangements and subject to Section 6.10.3, the Company
shall not be entitled to any rights, interests, benefits or other participation
under any of the Participation Agreements, all of which shall be solely for the
benefit of, and solely the obligations of, DEI and its Affiliates (other than
the Company), and following the date hereof, DEI and/or its Affiliates shall be
entitled, in their respective sole discretion, except as otherwise provided in
Section 6.10.2, to negotiate amendments, restatements or other modifications to
any of the Participation Agreements in order to terminate TDS USA's and/or TDS
Canada's rights, interests, benefits and participation thereunder, and Buyer
hereby consents to such amendments, restatements or other modifications to such
Participation Agreements. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.10.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effect of
Failure to Assign or Amend Participation Agreements</U>. The parties agree that
the failure by DEI, Seller or their Affiliates to amend, restate, modify, enter
into, assign or obtain any Consent required under any Participation Agreement in
connection with the transactions contemplated hereby shall not constitute a
breach of this Agreement by DEI or Seller for any purpose (including, without
limitation, for purposes of Sections 9.1.3, 9.1.4 and 9.1.5), and no such
failure by DEI or Seller shall relieve Buyer of its obligation to effect the
Closing as contemplated herein. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Certain Transactions and Agreements</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Company
Bank Accounts; Powers of Attorney</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Prior to the Closing, DEI and/or Seller
shall use their commercially reasonable efforts to remove effective as of the
Closing Date, as an authorized signatory with respect to TDS Canada's bank
account # **, held at the Bank of Montreal (the <B>"Bank of Montreal
Account"</B>), any Person that is so authorized and (ii) to the extent not done
prior to the Closing despite the exercise of their commercially reasonable
efforts, following the Closing, as soon as reasonably practicable following
Buyer's or the Company's request, DEI and/or Seller shall remove, effective
immediately, as an authorized signatory with respect to the Bank of Montreal
Account, any Person that is so authorized and that is not a Continuing Employee.
Buyer shall cooperate with DEI and Seller as reasonably requested by DEI or
Seller to arrange for the designation of substitute authorized signatories with
respect to the Bank of Montreal Account. Buyer acknowledges and agrees that it
shall have no right to or interest in the Bank of Montreal Account or any
amounts held therein prior to the Closing Date.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior to the Closing, DEI and/or Seller shall
use their commercially reasonable efforts to change, effective as of the Closing
Date, the owner or holder of each bank account owned or held in the name of TDS
USA and/or TDS Canada (other than the Bank of Montreal Account) to DEI or one of
its Affiliates (other than TDS USA or TDS Canada). Such bank accounts shall
include, without limitation, all savings, checking, deposit, credit and similar
accounts and any safe deposit box owned by or held in the name of TDS USA or TDS
Canada (other than the Bank of Montreal Account). Following the Closing, as soon
as reasonably practicable following Buyer's or the Company's request, DEI and/or
Seller shall change such ownership of any such bank account to the extent not
done prior to the Closing despite the exercise of their commercially reasonable
efforts. Buyer shall cooperate with DEI and Seller as reasonably requested by
DEI or Seller to arrange for such change in ownership to DEI or its designated
Affiliate (other than TDS USA or TDS Canada) following the Closing. Buyer
acknowledges and agrees that it shall have no right to or interest in any of
such accounts or any amounts held therein.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior to the Closing, DEI and/or Seller shall
use their commercially reasonable efforts to terminate effective as of the
Closing Date, and following the Closing, as soon as reasonably practicable
following Buyer's or the Company's request, DEI and/or Seller shall terminate
(to the extent not done prior to the Closing despite the exercise of their
commercially reasonable efforts) effective immediately, any power of attorney
given by the Company in favor of DEI, Seller and/or their employees, officers,
directors or Affiliates, other than any such power of attorney that is contained
in this Agreement, the Related Agreements, the Pre-Closing Transaction Contracts
(other than any Pre-Closing Transaction Contract that was not provided to Buyer
prior to the Closing in violation of Section 2.1) or any other Contracts entered
into in connection therewith.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Letters of
Credit Relating to Inventory Orders</U>. The parties acknowledge and agree that
(a) DEI or its Affiliates (other than the Company) shall be responsible for any
obligations incurred under letters of credit issued pursuant to a Trade LC
Facility in connection with, or as a payment mechanism for, inventory purchase
orders issued by the Company on or prior to the Closing Date (<B>"Pre-Closing
Inventory Orders"</B>), and (b) the Company, as a Subsidiary of Buyer, (i) shall
be solely responsible for issuing or causing the issuance of, and for any and
all obligations under, letters of credit issued in connection with, or as a
payment mechanism for, Post-Closing Inventory Orders and Non-LC Purchase Orders,
and DEI and its Affiliates shall not have any responsibility or liability
therefor, (ii) shall not under any circumstances issue, or cause to be issued,
under any Trade LC Facility (and the Company shall have no right to cause to be
issued under any Trade LC Facility), any letters of credit for Post-Closing
Inventory Orders or Non-LC Purchase Orders and (iii) if the Closing occurs,
shall indemnify and hold DEI and its Affiliates (other than the Company)
harmless from any Loss incurred in connection with any Post-Closing Inventory
Orders and/or any Non-LC Purchase Orders and/or any letters of credit issued in
connection therewith. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Disney
Umbrella Freight Services</U>. To the extent requested by the Company after the
Closing, DEI or its Affiliates (other than the Company) shall continue to
provide to the Company the Disney Umbrella Freight Services until the
forty-fifth (45<SUP>th</SUP>) day following the Closing Date or, if earlier, the
date following the Closing selected by Buyer (the <B>"Freight Services
Termination Date"</B>). After the Freight Services Termination Date, DEI and its
Affiliates shall cease to provide any such Disney Umbrella Freight Services to
the Company, and Buyer or the Company shall be solely responsible for procuring
any required, comparable replacement services for the Company. Any unpaid
invoices for Disney Umbrella Freight Services existing as of the Closing and any
invoices for Disney Umbrella Freight Services received by the Company after the
Closing shall by paid by DEI within thirty (30) days following submission
thereof by the Company to DEI (<U>provided</U>, that, the Company shall promptly
submit such invoices to DEI and shall not increase DEI's liability thereunder
through any delay or negligence on the part of the Company). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**.
</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Certain
Pre-Closing Expenses</U>. No later than ten&#160;(10) Business Days following
DEI's submission of an invoice or other comparable request for reimbursement to
Buyer, whether or not the Closing shall occur, Buyer shall pay directly to DEI
(and not to the Company) an amount equal to all costs and expenses incurred by
the Company or its Affiliates for those activities or items set forth on <U>TDS
Schedule 6.11.5</U>, or such portion thereof as is set forth on such schedule.
Any such costs and expenses incurred by the Company or its Affiliates following
the Closing Date in respect of such activities shall be borne solely by the
Company and/or TCP, as the case may be, and none of DEI or its Affiliates shall
have any liability or responsibility therefor. This covenant shall survive any
expiration or termination of this Agreement indefinitely. If, following the
Closing, DEI or any of its Affiliates becomes subject to an audit or other
governmental investigation or proceeding relating to or in connection with any
Form I-9 that has been provided to Buyer in connection with the payment of
expenses for activities or items set forth on
<U>TDS Schedule 6.11.5</U>, then, within five (5) Business Days after DEI's
request, Buyer or its Affiliates (as applicable) shall, at their sole cost and
expense, provide to DEI or its designated Affiliate an original of any and all
such Forms I-9. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Company Credit
Facility; Supporting LCs</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall at its sole cost and expense,
establish on or prior to the Closing (and have in place as of the Closing) the
Company Credit Facility in accordance with the terms and provisions of this
Section 6.11.6, which credit facility, as of the Closing (i) shall provide for
the issuance of letters of credit in connection with, or as a payment mechanism
for, Post-Closing Inventory Orders and Non-LC Purchase Orders and (ii) shall
comply with all of the terms and provisions of this Agreement, the License and
Conduct of Business Agreement, any other Related Agreement and the TCP Guaranty
and Commitment. Buyer hereby represents and warrants that, prior to the date
hereof, DEI and Seller have been provided with initial drafts of all material
Contracts to be entered into by Buyer or its Affiliates (including the Company,
as a Subsidiary of Buyer) in connection with the Company Credit Facility. Buyer
shall, from and after the date hereof, provide DEI and Seller with each new or
revised draft of all Contracts to be entered into by Buyer or its Affiliates
(including the Company, as a Subsidiary of Buyer) or any other Person in
connection with the Company Credit Facility that is distributed between the
parties thereto (if applicable, redlined to reflect changes therein). In the
event that any such new or revised draft Contract relating to the Company Credit
Facility reflects modifications, whether direct or indirect, to any DEI Related
Provision that have been requested by Buyer or its Affiliates, Wells Fargo or
its Affiliates, any lender under the Company Credit Facility or any Person other
than DEI, Seller and their Affiliates, then (i) DEI and Seller shall have the
right to review and comment on such modifications, which comments shall be
considered by Buyer and its Affiliates in good faith, and (ii) the final version
of each DEI Related Provision shall be subject to the prior written approval of
DEI and Seller in their respective business judgment, such approval or
disapproval to be communicated to Buyer within five (5) Business Days after such
final versions are provided to DEI; provided that DEI and Seller acknowledge and
agree that they have approved the versions of the DEI Related Provisions
contained in the Pre-Signing Company Drafts, subject to their right to comment
on and approve any direct or indirect modifications thereof that may be proposed
by any Person (other than DEI, Seller and their Affiliates). Buyer hereby agrees
to use all of its commercially reasonable efforts, and to cause its Affiliates
to use all of their commercially reasonable efforts, to resolve or cause the
resolution of (including, without limitation, using all of their commercially
reasonable efforts to negotiate with the applicable bank or banks and/or their
respective Representatives), any issues arising out of or resulting from the
exercise by DEI and Seller of their approval rights under this Section 6.11.6
relating to DEI Related Provisions. For purposes of clarification, to the extent
DEI's and Seller's approval is required in accordance with the preceding
sentences of this Section 6.11.6(a), any credit facility established by Buyer
for and on behalf of the Company that is not approved by DEI and Seller in
accordance with and as and to the extent provided in this Section 6.11.6 or that
does not otherwise comply with the other terms and provisions of this Agreement
(including, without limitation, the other terms and provisions of this Section
6.11.6), or that does not comply with all of the terms and provisions of the
License and Conduct of Business Agreement, any other Related Agreement and the
TCP Guaranty and Commitment, shall not be considered the "Company Credit
Facility" for purposes of this Agreement and shall be deemed a breach of this
Agreement, the License and Conduct of Business Agreement, any such other Related
Agreements and the TCP Guaranty and Commitment. Upon the Closing, subject to
satisfaction of the provisions of this Section 6.11.6(a), DEI agrees that it
shall cause TDSF to execute and deliver to Wells Fargo, as agent under the
Company Credit Facility, the Designation of Secured Lender Under License
Agreement included as part of <U>Annex H</U> hereto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buyer may, at its sole option, cause the
Company Credit Facility (i) to provide for the issuance of Supporting LCs and
(ii) to allow for the payment from the proceeds of borrowings thereunder of the
Estimated Closing Working Capital Adjustment Amount pursuant to and in
accordance with Section 3.3.1. If, as of the Closing, the Company Credit
Facility provides for the issuance of Supporting LCs, then Buyer may elect to
cause one (1) or more Supporting LCs (which shall be in form and substance
approved by DEI and Seller in their respective business judgment) to be issued
as of the Closing and, if Buyer so elects, then: (i) Buyer shall notify DEI and
Seller at least ten (10) Business Days prior to the Closing Date of its election
to have Supporting LCs issued as of the Closing and shall, at least three (3)
Business Days prior to the Closing Date, provide DEI and Seller with evidence
satisfactory to DEI and Seller in their respective business judgment, that such
Supporting LCs will be issued as of the Closing; (ii) Buyer shall, at least ten
(10) Business Days prior to the Closing Date, provide DEI and Seller with
initial drafts of such Supporting LCs and any related Contracts (to the extent
not already reviewed and approved by DEI and Seller pursuant to subparagraph (a)
of this Section 6.11.6), and shall, thereafter, provide DEI and Seller with each
revised draft of any such Supporting LC and related Contract that is distributed
between the parties thereto (redlined to reflect changes therein), and DEI and
Seller shall have the right to review and comment on all drafts of such
Supporting LCs and Contracts, which comments shall be considered by Buyer in
good faith, and all final terms and provisions of such Supporting LCs and
Contracts shall be subject to the prior written approval of DEI and Seller in
their respective business judgment; and (iii) DEI and Seller shall notify Buyer,
at least five (5) Business Days prior to the Closing Date, of (A) the number of
outstanding letters of credit issued (but not drawn) pursuant to a Trade LC
Facility as of such date in connection with, or as a payment mechanism for,
Buyer Ordered Inventory, and the total outstanding obligations relating to Buyer
Ordered Inventory as of such date under each such letter of credit, and (B) the
estimated Disney Umbrella Freight Services Amounts as of such date. The
estimates provided by DEI and Seller pursuant to the preceding subparagraph
(iii) of this Section 6.11.6(b) shall not be binding on DEI, Seller or the
Company in connection with their preparation of the Closing Balance Sheet, the
parties acknowledging and agreeing that such estimates may increase or decrease
in connection with the preparation of the Closing Balance Sheet.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If any Supporting LCs that have been approved
in writing by DEI and Seller as provided in this Section 6.11.6 are issued as of
the Closing, then (if applicable), (i) Buyer Ordered Inventory shall exclude any
such inventory with respect to which a Supporting LC has been issued as of the
Closing pursuant to and in accordance with this Section 6.11.6 in an amount
sufficient to support payment of the entire liability under the issued but
undrawn letter of credit under the Trade LC Facility that relates to or covers
the inventory that would otherwise be classified as Buyer Ordered Inventory and
(ii) the Disney Umbrella Freight Services Amounts shall exclude any such amounts
in respect of which a Supporting LC has been issued as of the Closing pursuant
to and in accordance with this Section 6.11.6. Following the Closing, DEI and
its Affiliates shall be entitled to draw immediately upon demand under any
Supporting LC in an amount equal to any amount DEI or its Affiliates is required
to pay for any Buyer Ordered Inventory or Disney Umbrella Freight Services if
such payment is not reimbursed by the Company within three (3) Business Days
after demand for such reimbursement by DEI or its Affiliates to the Company
(accompanied by copies of a bill of lading and/or invoice referred to in the
next sentence). Notwithstanding the foregoing, and for purposes of
clarification, any and all Supporting LCs must provide that DEI and its
Affiliates shall be entitled to draw thereunder immediately upon demand without
presenting any documentation or other evidence of the right to payment
thereunder other than a bill of lading and/or invoice that relate to the Buyer
Ordered Inventory or an invoice that relates to the Disney Umbrella Freight
Services covered by the applicable Supporting LC, together with a signed
statement of an officer of DEI or one of its Affiliates that, to the knowledge
of such officer, the Company has failed to reimburse DEI or its Affiliates for
such payment. In the event that, following the Closing, any Supporting LC
becomes unenforceable and/or DEI or any of its Affiliates is unable to collect
for any reason any part of the payments owed to it under such Supporting LC,
then (i) Buyer shall pay to DEI, within one (1) Business Day following DEI's
demand therefor, all amounts owed to DEI under such Supporting LC and, until all
such amounts are indefeasibly paid in full to DEI, Buyer shall be and remain
liable for all such amounts and (ii) Buyer shall reimburse DEI or any of its
Affiliates, upon demand, for any and all costs and expenses incurred by DEI or
its Affiliates in connection with the collection of payments due and owing to
such Person under such Supporting LC. Upon reimbursement (including through a
draw on a Supporting LC) of a payment made by DEI or its Affiliates with respect
to Buyer Ordered Inventory, the applicable bill of lading, if and to the extent
assignable, shall be assigned to the Company (if such bill of lading is not
issued in the name of the Company but is instead issued in the name of DEI or
any of its Affiliates).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Wells Fargo
Credit Facility</U>. Buyer hereby represents and warrants that, prior to the
date hereof, DEI and Seller have been provided with initial drafts of all
material Contracts to be entered into by Buyer or its Affiliates (including the
Company, as a Subsidiary of Buyer) in connection with the Wells Fargo Credit
Facility. Buyer shall, from and after the date hereof, provide DEI and Seller
with each new or revised draft of all Contracts to be entered into by Buyer or
its Affiliates (including the Company, as a Subsidiary of Buyer) or any other
Person in connection with the Wells Fargo Credit Facility that is distributed
between the parties thereto (if applicable, as redlined to reflect changes
therein). In the event that any such new or revised draft Contract relating to
the Wells Fargo Credit Facility reflects modifications, whether direct or
indirect, to any DEI Related Provision that have been requested by Buyer or its
Affiliates, Wells Fargo or its Affiliates, any lender under the Wells Fargo
Credit Facility or any Person other than DEI, Seller and their Affiliates, then
(i) DEI and Seller shall have the right to review and comment on such
modifications, which comments shall be considered by Buyer and its Affiliates in
good faith, and (ii) the final version of each DEI Related Provision shall be
subject to the prior written approval of DEI and Seller in their respective
business judgment, such approval or disapproval to be communicated to Buyer
within five (5) Business Days after such final versions are provided to DEI;
provided that DEI and Seller acknowledge and agree that they have approved the
versions of the DEI Related Provisions contained in the Pre-Signing Wells Draft,
subject to their right to comment on and approve any direct or indirect
modifications thereof that may be proposed by any Person (other than DEI, Seller
and their Affiliates). Buyer hereby agrees to use all of its commercially
reasonable efforts, and to cause its Affiliates to use all of their commercially
reasonable efforts, to resolve or cause the resolution of (including, without
limitation, using all of their commercially reasonable efforts to negotiate with
Wells Fargo and/or its Representatives), any issues arising out of or resulting
from the exercise by DEI and Seller of their approval rights under this Section
6.11.7 with respect to DEI Related Provisions. For purposes of clarification, to
the extent DEI's and Seller's approval is required in accordance with the
preceding sentences of this Section 6.11.7, any Contract relating to the Wells
Fargo Credit Facility that is not approved by DEI and Seller in accordance with
and as and to the extent provided in this Section 6.11.7 or that does not
otherwise comply with the other terms and provisions of this Agreement
(including, without limitation, the other terms and provisions of this Section
6.11.7), or that does not comply with all of the terms and provisions of the TCP
Guaranty and Commitment, the License and Conduct of Business Agreement or any
other Related Agreement, shall be deemed a breach of this Agreement, the TCP
Guaranty and Commitment, the License and Conduct of Business Agreement and/or
any such other Related Agreements. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Distribution
Center Observers</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From and after the date hereof and pursuant to
and in accordance with this Section 6.11.8, Buyer shall be entitled to designate
up to but not more than three (3) persons that are either employees of Buyer or
its Affiliates or employees of Buyer's Representatives, which persons must be
approved in advance by DEI and Seller in their respective business judgment
pursuant to subparagraph (b) of this Section 6.11.8, to be present on site at
the Distribution Center (each such person, a <B>"DC Observer"</B>). The role of
each DC Observer shall be limited solely to that of observation, and no DC
Observer shall have any other rights or benefits by virtue of such person's
designation as a DC Observer. None of the DC Observers shall (i) in any manner,
interfere with the conduct of the business of the Company (or, from and after
the Closing, the business of DEI or any of its Affiliates) or (ii) have any
rights of oversight with respect to any of the employees of the Company (or,
from and after the Closing, any employees of DEI or its Affiliates) or any right
to instruct, for any reason or in any manner, such employees. Each DC Observer
shall at all times during which such person is a DC Observer remain an employee
of Buyer or one of its Affiliates or Representatives, and as between Buyer and
DEI and its Affiliates, Buyer shall be solely responsible for paying all costs
related to or arising in connection with each DC Observer, including, without
limitation, any employment-related costs. In addition, Buyer shall indemnify and
hold harmless DEI and its Affiliates for any Loss incurred by any of them in
connection with, or as a result of (i) the exercise of Buyer's rights under this
Section 6.11.8 and/or (ii) the designation, placement, removal or replacement of
any person as a DC Observer.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If Buyer elects to exercise its rights to
designate one (1) or more DC Observers, Buyer shall give prior written notice
thereof to DEI and Seller, which notice shall state: (i) that Buyer is electing
to exercise its rights pursuant to this Section 6.11.8, (ii) the name of the
person or persons designated as a DC Observer, and (iii) the position held by
each such person at Buyer or the applicable Affiliate or Representative of
Buyer. DEI and Seller shall, as soon as practicable after receipt of such
notice, inform Buyer of their approval or disapproval of Buyer's designee or
designees, and, upon approval of a designee by DEI and Seller in their
respective business judgment, such designee shall become a DC Observer. In the
event that any designee of Buyer is disapproved by DEI and/or Seller, Buyer
shall be entitled to select a replacement designee, and shall repeat the
procedures outlined in this subparagraph (b) until a designee is approved by DEI
and Seller in accordance with this Section 6.11.8. Buyer, DEI and Seller shall
each have the right, in their respective sole discretion, to remove any person
from the role of DC Observer, for any reason or no reason at all. In the event
that Buyer removes any person from the role of DC Observer or any person resigns
from the role of DC Observer, Buyer shall give written notice of such removal or
resignation to DEI and Seller. In the event that DEI or Seller removes any
person from the role of DC Observer, DEI or Seller, as applicable, shall give
written notice of such removal to Buyer. Neither DEI nor any of its Affiliates
shall have any responsibility or liability for or in connection with the removal
of any person from the role of DC Observer, whether such removal is effected by
Buyer, DEI, Seller or their respective Affiliates or Representatives. If, upon
removal or resignation of any person from the role of DC Observer, Buyer elects
to designate a replacement DC Observer, then such replacement shall be
designated pursuant to and in accordance with the provisions of this Section
6.11.8 (including, without limitation, this subparagraph (b)).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buyer's rights pursuant to this Section 6.11.8
to designate one (1) or more DC Observers and to have such DC Observers present
on-site at the Distribution Center shall terminate upon the termination of the
Transitional Distribution Services Agreement, and from and after such date,
Buyer shall have no right to have any of its employees or the employees of its
Affiliates or Representatives present at the Distribution Center.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>SunTrust
Agreement</U>. DEI and Seller agree that if, and from and after the date on
which, DEI and Seller determine that SunTrust (or its successor) has refused to
provide a Consent under the SunTrust Agreement to the transactions contemplated
by this Agreement, notwithstanding compliance by Buyer, DEI and Seller with
Section 6.6.2 (with DEI to provide Buyer with written notice of such inability
to obtain a Consent within five (5) Business Days of such determination), then
Buyer shall be entitled, in its sole discretion, to negotiate with SunTrust (or
another servicing bank) prior to the Closing, with respect to an agreement
pursuant to which the Company would be entitled to accept Mastercard and Visa
credit and charge cards in the United States following the Closing, subject to
the terms and conditions of subparagraphs (A), (B) and (C) of Section 6.10.2.
The parties agree that the failure by DEI or Seller to obtain the Consent of
SunTrust (or, as applicable, its successor) under the SunTrust Agreement in
connection with the transactions contemplated hereby shall not constitute a
breach of this Agreement by DEI or Seller for any purpose (including, without
limitation, for purposes of Sections 9.1.3, 9.1.4 and 9.1.5), and no such
failure by DEI or Seller shall relieve Buyer of its obligation to effect the
Closing as contemplated herein. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Company
Plans</U>. DEI and Seller shall terminate the Company Plans (or, as applicable,
shall cause the Company Plans to be terminated) prior to the Closing.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Certain
Transactions by TCP</U>. In the event that any Affiliate of TCP (i) becomes an
"Affiliate Guarantor" as defined in and pursuant to the terms of the TCP
Guaranty and Commitment or (ii) becomes bound by the obligations, restrictions
or provisions pertaining to TCP under the TCP Guaranty and Commitment pursuant
to the terms and conditions contained in the definition of "TCP" under the TCP
Guaranty and Commitment (assuming, for purposes of this Section 6.11.11, that
the TCP Guaranty and Commitment had been executed and delivered and was in
effect as of the date hereof) (any such Affiliate of TCP described in
subparagraphs (i) and (ii), an <B>"Obligor"</B>), Buyer shall promptly
thereafter provide written notice to DEI and Seller of such event, and the
obligation of the parties to execute and deliver (or cause their Affiliates to
execute and deliver) certain documents as set forth in Section 6.16 shall apply
to the execution and delivery of the TCP Guaranty and Commitment (or, as
applicable, a guarantee of the obligations of TCP thereunder) by such Obligors.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Certain
Employee Cards and Other Property</U>. Buyer hereby agrees and acknowledges
that, prior to the Closing, the Company or its Affiliates shall be entitled to
collect, from any and all of the Continuing Employees, the following items that
were issued to or otherwise granted to such Continuing Employees prior to the
Closing (collectively, the <B>"Disney Issued Property"</B>): (i) all
identification cards issued by the Company or its Affiliates, (ii) all business
cards given to the Continuing Employees identifying the Continuing Employees as
employees of the Company or its Affiliates, (iii) all employee credit or charge
cards, benefit cards, and/or other payment instruments issued by the Company or
its Affiliates, including, without limitation, "Silver Passes" for Theme Parks
of the Company or its Affiliates, Disney's Visa Card, procurement cards and
telephone calling cards, and (iv) all vehicles identified in item 21 of <U>TDS
Schedule 1.1(d)</U>. To the extent that prior to the Closing the Company or its
Affiliates do not collect all of the Disney Issued Property from the Continuing
Employees, Buyer shall, from and after the Closing, provide reasonable
assistance to DEI and its Affiliates, and shall cooperate with them, to procure
the return of all such Disney Issued Property from the Continuing Employees to
DEI and its Affiliates. From and after the Closing, Buyer shall indemnify and
hold DEI and its Affiliates harmless from any Loss incurred by any of them in
connection with the use of any Disney Issued Property after the Closing by any
of the Continuing Employees. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Solvency Opinion</U>. DEI, Seller and/or
one or more of their Affiliates shall obtain an opinion, addressed to DEI and
Seller, from Jefferies &amp; Company, Inc., or if such firm is unable to render
such opinion, such other firm as DEI or Seller shall select in its respective
sole discretion, regarding the solvency of TDS USA following the consummation of
the transactions contemplated by this Agreement, the form and content thereof to
be satisfactory to DEI and Seller in their respective business judgment. DEI and
Seller shall provide a copy of such solvency opinion to Buyer. DEI and Seller,
on the one hand, and Buyer, on the other hand, shall each be responsible for
paying one-half of all fees, expenses and costs of the firm rendering such
solvency opinion incurred in connection with obtaining such solvency opinion,
<U>provided</U>, that Buyer shall not be required to pay more than One Hundred
Thousand Dollars ($100,000) of such fees, expenses and costs. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Company Audit</U>. At least five (5)
Business Days prior to the Closing, DEI and Seller shall cause to be prepared
and delivered to Buyer the combined balance sheets of TDS USA and TDS Canada as
of September 27, 2003 and June 26, 2004 and the related combined statements of
operations and retained earnings and of cash flows of TDS USA and TDS Canada for
each of the two (2) fiscal years ended September&#160;28, 2002 and September 27,
2003, respectively, and the nine (9) months ended June&#160;26, 2004, which
shall be prepared in accordance with GAAP and audited by PWC (collectively, the
<B>"TDS Audited Financial Statements"</B>). TCP shall have the right to include
such TDS Audited Financial Statements in its current report on Form 8-K filed
with the SEC relating to the transactions contemplated hereby and in any other
reports or registration statements filed by TCP with the SEC. DEI and Seller, on
the one hand, and Buyer, on the other hand, shall each be responsible for paying
one-half of the auditor fees and reasonable and documented out-of-pocket auditor
expenses incurred in connection with such audit, provided, that Buyer shall not
be required to pay more than Two Hundred Fifty Thousand Dollars ($250,000) of
such fees and expenses. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.14&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Competing Offers</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.14.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither DEI
nor Seller shall, nor shall either of them authorize or permit the Company or
their respective Affiliates or any of the officers, directors, employees,
investment bankers, financial advisors, attorneys, accountants or other
representatives of DEI, Seller, the Company or their respective Affiliates to,
contact any person for the purpose of soliciting any Competing Offer, or
participate in any discussions or negotiations, or provide third parties with
any nonpublic information, relating to any such Competing Offer;
<U>provided</U>, <U>that</U>, if the Board of Directors of TWDC determines in
good faith and based on advice of its financial advisor and after consultation
with outside legal counsel that a Competing Offer that did not result from a
breach of this Section 6.14.1 is or might reasonably be considered to be a
Superior Proposal, DEI, Seller, the Company and their Affiliates may (a) furnish
information with respect to the Company, DEI, Seller and their Affiliates to any
Person under a customary confidentiality agreement, which shall not be less
favorable to DEI and Seller in any material respect than the Confidentiality
Agreement, (b) participate in discussions and negotiations regarding such
Competing Offer and (c) if the Board of Directors of TWDC determines in good
faith and based on advice of counsel that such Competing Offer is a Superior
Proposal and that, in order for such Board of Directors to comply with its
fiduciary duties, it is required to cause the acceptance of such Competing Offer
by DEI and/or its Affiliates, accept such Superior Proposal, enter into a letter
of intent or understanding (whether or not binding) and/or binding definitive
agreements therefor and terminate this Agreement under Section 9.1.6,
<U>provided</U>, <U>that</U>, prior to taking any such action under this
subparagraph (c) of this Section 6.14.1, TWDC shall have provided Buyer with at
least three (3) Business Days written notice of its intention to do so and of
the material economic terms of such Superior Proposal. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.14.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEI and Seller
shall promptly advise Buyer in writing of the identity of any Person who makes a
Competing Offer as to which DEI or its Affiliates intend to engage in any of the
activities described in subparagraphs (a), (b) or (c) of Section 6.14.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.15&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Transitional Services Agreements;
Bifurcation of License and Conduct of Business Agreement; Operating Manual;
Additional Documents to be Prepared Prior to Closing</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.15.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Transitional
Services</U>. Buyer, on the one hand, and DEI and Seller, on the other hand,
hereby agree to provide to each other (or, as applicable, to cause their
Affiliates to so provide) the transitional services described in subparagraphs
(a)-(d) (inclusive) of this Section 6.15.1. Such transitional services shall be
provided during the period beginning on the Closing Date and ending on the date
specified in the applicable transitional services agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEI and/or its Affiliates, on the one hand, and
Buyer, the Company and/or their Affiliates, on the other hand, shall provide to
each other certain administrative services and DEI or its Affiliates shall
provide certain office facilities to the Company, in each case on a transitional
basis and in accordance with the terms set forth on <U>TDS Schedule
6.15.1(i)</U> (the <B>"Transitional Administrative Services
Agreement"</B>).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEI and/or its Affiliates shall provide the
Company with certain inventory distribution services through the Distribution
Center operated by the Company prior to the Closing on a transitional basis and
in accordance with the terms set forth on <U>TDS Schedule 6.15.1(ii)</U> (the
<B>"Transitional Distribution Services Agreement"</B>).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEI and/or its Affiliates, on the one hand, and
Buyer, the Company and/or their Affiliates, on the other hand, shall provide to
each other certain Information Technology services on a transitional basis and
in accordance with the terms set forth on <U>TDS Schedule 6.15.1(iii)</U> (the
<B>"Transitional Information Technology Services Agreement"</B>).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company shall operate the Deferred Stores
(including any Approved Deferred Stores) and the Disney Retained Stores (other
than the Flagship Stores) from and after the Closing Date and, as applicable,
conduct the closure thereof, in each case in accordance with the terms set forth
on <U>TDS Schedule 6.15.1(iv)</U> (the <B>"Transitional Disney Retained Stores
Agreement"</B>).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.15.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Bifurcation
of License and Conduct of Business Agreement</U>. Prior to the Closing, at the
election of DEI and Seller (to be exercised in their respective sole
discretion), DEI, Seller and Buyer shall negotiate in good faith and in a
commercially reasonable manner and as expeditiously as practicable to bifurcate
the License and Conduct of Business Agreement into two (2) separate Contracts,
one consisting of a License Agreement pertaining primarily to the Intellectual
Property licensed by TDS Franchising to the Company thereunder and the royalties
arising therefrom, and the other consisting of a Conduct of Business Agreement
pertaining primarily to the operation of the Stores by the Company thereunder.
DEI and Seller shall take the lead in drafting and revising such bifurcated
Contracts. Both parties agree that, in connection with such bifurcation, they
shall in good faith maintain the relationship of the parties thereunder as if it
were a single Contract (e.g., as appropriate, including cross-termination and
other comparable provisions to ensure that the bifurcation of the combined
Contract does not alter the nature of the relationship between the parties
thereunder), and that the resulting bifurcated Contracts shall, taken together,
not contain, reflect or create any change to the respective rights and
obligations of the parties that would have existed among the parties to the
combined Contract if it were not so bifurcated. In addition, in connection with
such bifurcation, the parties may elect to relocate portions of the bifurcated
License Agreement and Operating Agreement into schedules or exhibits thereto as
the parties deem reasonable and appropriate. In the event that the License and
Conduct of Business Agreement is bifurcated prior to the Closing in the manner
provided in this Section 6.15.2, then all references in this Agreement to the
License and Conduct of Business Agreement shall be deemed to be references to
the bifurcated Contract in which the applicable provisions reside or, if
applicable, to both such Contracts, and the obligations of the parties to
execute and deliver (or to cause their Affiliates to execute and deliver)
certain documents as set forth in Section 6.16 shall apply to both the License
Agreement and the Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.15.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Operating
Manual</U>. The Operating Manual contemplated by the License and Conduct of
Business Agreement shall be substantially in the form attached hereto as <U>TDS
Schedule 6.15.3</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.15.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Additional
Documents</U>. Prior to the Closing, DEI, Seller and Buyer shall negotiate and
complete in good faith and in a commercially reasonable manner and as
expeditiously as practicable the terms and conditions of any additional
agreements, documents and instruments as DEI or Seller shall determine are
reasonably necessary, desirable or appropriate in order to consummate the
transactions contemplated by this Agreement, which agreements, documents and
instruments shall be subject to the mutual approval of the parties in their
respective business judgment, except as to matters pertaining to any
Intellectual Property of DEI or its Affiliates, which shall be subject to the
approval of DEI in its sole discretion and the approval of Buyer in its business
judgment. DEI and Seller shall take the lead in drafting and revising any and
all such agreements, documents and instruments. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.16&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Execution and Delivery of Documents</U>.
Provided that the conditions to the obligations of the parties to consummate the
transactions contemplated by this Agreement as set forth in Article VIII (other
than Sections 8.2.3 and 8.3.5) have been satisfied or waived, on the Closing
Date, each of DEI and Buyer shall, or shall cause their respective Affiliates
to, execute and deliver the documents necessary to satisfy the condition set
forth in Section 8.2.3 (in the case of DEI) or Section 8.3.5 (in the case of
Buyer). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.17&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Independent Directors</U>. Prior to the
Closing, Buyer, DEI and Seller shall jointly select two (2) Persons meeting the
requirements of "Independent Directors" as defined in the License and Conduct of
Business Agreement who shall be willing to serve as directors (or in a
comparable capacity in the case of any limited liability company or other
Entity) and shall be elected as directors (or to comparable positions in the
case of any limited liability company or other Entity) of (i) Buyer, TDS USA
(or, as applicable, New TDS LLC) and each of their respective Subsidiaries
(other than TDS Canada) on the Closing Date immediately following the
consummation of the Membership Unit Acquisition and the Share Acquisition and
(ii) TDS Canada (or, as applicable, its successor) within twenty (20) Business
Days following the Closing Date or, if and only if the Canada Reincorporation is
delayed beyond the twentieth (20th) Business Day following the Closing as a
result of an action taken, or failed to be taken, in error on or prior to the
Closing by DEI or its Affiliates and having the effect specifically described in
the first sentence of Section 2.6.2, then on the Canada Reincorporation Date.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.18&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Initial Equity Investment</U>. At least two
(2) Business Days prior to the Closing, Buyer shall have, or shall otherwise
have available to it, the Fifty Million Dollars ($50,000,000) of equity capital
in the form of cash or cash equivalents that is required to be invested in TDS
USA immediately following the consummation of the Membership Unit Acquisition
and the Share Acquisition pursuant to Section 7.13, and Buyer shall on such date
that is two (2) Business Days prior to the Closing provide DEI and Seller with
evidence of the foregoing in a form reasonably satisfactory to DEI and Seller.
</FONT></P>

<P ALIGN=CENTER><B>ARTICLE VII<BR>
CONTINUING COVENANTS</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Tax Matters</U>.</FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Tax
Returns</U>. DEI or Seller shall prepare or cause to be prepared and file or
cause to be filed all Tax Returns required to be filed by or with respect to the
Company that relate to taxable periods ending on or before the Closing Date,
including all such Tax Returns that are required to be filed after the Closing
Date. Buyer shall, upon request, cause the Company to execute any such Tax
Returns required to be executed by the Company in a timely manner prior to
filing by DEI or Seller. DEI or Seller shall timely pay all Taxes due under such
returns to the extent the amount thereof exceeds the amount of Taxes accrued or
otherwise reflected as a Current Liability on the Final Closing Balance Sheet
and/or the Final Subsequent Closing Balance Sheet, and Buyer shall, or shall
cause the Company to, timely pay all Taxes due under such returns up to the
amount of Taxes accrued or otherwise reflected as a Current Liability on the
Final Closing Balance Sheet and/or the Final Subsequent Closing Balance Sheet.
Buyer shall not amend or refile any Tax Return with respect to the Company for
any period ending on or before the Closing Date without the prior written
consent of DEI, which consent may be granted or withheld in DEI's sole
discretion. Buyer shall prepare or cause to be prepared and file or cause to be
filed all Tax Returns required to be filed with respect to the Company that
relate to taxable periods ending after the Closing Date, including all Tax
Returns for taxable periods that begin before the Closing Date and end after the
Closing Date, and Buyer shall, or shall cause the Company to, timely pay all
Taxes due under such returns; <U>provided</U>, <U>however</U>, that, to the
extent the amount of Taxes attributable to periods before and including the
Closing Date (but excluding Taxes attributable to transactions following the
Closing and outside of the ordinary course of business) exceeds the amount of
Taxes accrued or otherwise reflected as a Current Liability on the Final Closing
Balance Sheet and/or the Final Subsequent Balance Sheet, DEI or Seller shall pay
Buyer an amount equal to the amount of such excess at least ten (10) Business
Days prior to the later of the time that (a)&#160;Buyer is required to pay such
taxes and (b) Buyer provides DEI and Seller with a copy of such returns and its
determination of the portion of such Taxes attributable to the taxable period
ending on the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Cooperation
on Tax Matters</U>. Buyer, DEI and Seller shall, and Buyer shall cause the
Company to, cooperate fully, as and to the extent reasonably requested by the
other party, in connection with the filing of Tax Returns under Section 7.1.1
and any audit, litigation, or other proceeding with respect to Taxes (a <B>"Tax
Proceeding"</B>). Such cooperation shall include the retention and (upon the
other party's request) the provision of records and information that are
reasonably relevant to any such Tax Proceeding and the availability of employees
on a mutually convenient basis to provide additional information and explanation
of any material provided hereunder. Buyer, DEI and Seller agree (A) to retain
all books and records with respect to Tax matters pertinent to the Company
relating to any taxable period beginning before the Closing Date until the
expiration of the statute of limitations or, in the case of TDS Canada, the
expiration of any period during which a recognized document assessing liability
for Tax may be issued by a Governmental Entity (and, to the extent notified by
Buyer, DEI or Seller, any extensions thereof) of the respective taxable periods,
and to abide by all record retention agreements entered into with any taxing
authority, and (B) to give the other party reasonable written notice prior to
transferring, destroying or discarding any such books and records and, if the
other party so requests, Buyer, DEI or Seller, as the case may be, shall allow
the other party to take possession of such books and records to the extent they
would otherwise be destroyed or discarded. Each of Buyer, DEI and Seller shall
bear its respective costs and expenses in connection with any Tax Proceeding;
<U>provided</U>, that, (i) if such Tax Proceeding relates solely to the period
after the Closing Date, Buyer shall reimburse DEI and Seller, as applicable, for
any out-of-pocket expenses (including, without limitation, fees and expenses of
attorneys and other professionals) reasonably incurred by DEI or Seller, as
applicable, in connection therewith and (ii) if such Tax Proceeding relates
solely to the period before the Closing Date, DEI or Seller shall reimburse
Buyer for any out-of-pocket expenses (including, without limitation, fees and
expenses of attorneys and other professionals) reasonably incurred by Buyer in
connection therewith. Any information obtained under this Section 7.1.2 or under
any other Section hereof providing for the sharing of information or the review
of any Tax Return or other schedule relating to Taxes shall be subject to
Section 11.9. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Transaction
Taxes</U>. Any sales, use, transfer, documentary, registration and other similar
taxes (including related penalties (civil or criminal), additions to tax and
interest) imposed by any Governmental Entity with respect to the transactions
(other than the Pre-Closing Transactions) contemplated by this Agreement
<B>("Transaction Taxes"</B>) shall be paid by the party having primary
liability therefor under applicable Law (or, if Seller and DEI, on the one hand,
and Buyer, on the other hand, share primary liability under applicable Law, then
such Transaction Tax shall be shared equally). Seller and/or DEI shall be
required to pay any Taxes imposed by any Governmental Entity with respect to the
Pre-Closing Transactions. The party required to pay any Transaction Tax shall
provide written notice to the other party of the payment of and/or a written
response to such other party upon any request for information regarding the
status of any Transaction Taxes. Such paying party shall also be responsible for
(i) administering the payment of such Transaction Taxes, (ii) defending or
pursuing any proceedings related thereto, and (iii) paying any expenses related
thereto. Such paying party shall give prompt written notice to the other party
of any proposed adjustment or assessment of any Transaction Taxes or of any
examination of the transactions contemplated hereby in a sales, use, transfer or
similar tax audit. Neither party shall negotiate a settlement or compromise of
any Transaction Taxes for which the other party has liability under applicable
Law without the prior written consent of such other party, which consent shall
not be unreasonably withheld, conditioned or delayed. With respect to the
Approved Deferred Stores, within twenty (20) Business Days following the
Subsequent Closing Date, Buyer shall cause the Company to (a) provide DEI and
Seller with a copy of a valid seller's permit (or equivalent
retailer's license) in all states&#160;where the Approved Deferred Stores
are located and in which the Company is engaged or will be engaged in the
business of selling retail merchandise and (b) certify that the inventory
property of the Approved Deferred Stores will be sold at retail. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Tax
Refunds</U>. Any Tax refunds (including any refund of an overpayment of Tax and
any right to a Tax refund that is credited against any Tax due for a period
ending after the Closing) received by TDS USA, TDS Canada or Buyer after the
Closing that are attributable to Taxes paid (or overpaid) with respect to
income, activities or operations of TDS USA or TDS Canada for periods ending on
or before the Closing Date, including, without limitation, those refunds listed
on <U>TDS Schedule 7.1.4</U>, shall be paid by the Company and/or Buyer (as
applicable) to DEI and its Affiliates within five (5) Business Days after such
refund is received. From and after the Closing, DEI and its Affiliates shall be
responsible for obtaining and pursuing all such Tax refunds described in the
preceding sentence, and the cooperation provisions of Section 7.1.2 shall apply
to any such claim for a Tax refund as if such claim constituted a Tax
Proceeding. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Other Cooperation</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Buyer</U>.
After the Closing, Buyer will, and will cause the Company to, afford to DEI,
Seller and their Affiliates and to their accountants, counsel and other
Representatives, reasonable access during normal business hours upon reasonable
prior notice to the books and records of the Company and the employees of Buyer
and the Company (or any successors thereto). DEI, Seller and their Affiliates
and Representatives may, at the expense of DEI or Seller, make copies of such
books and records. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Seller and
DEI</U>. After the Closing (or as applicable, the Subsequent Closing), to the
extent permitted by applicable Law (including, without limitation, privacy
regulations), and to the extent not covered by Section 7.2.3, DEI and Seller
will (i) deliver and will cause their Affiliates to deliver to Buyer the books
and records relating solely to the Business (and not in any manner relating to
the Intellectual Property of DEI, Seller or their Affiliates or any other
matters specifically addressed in the License and Conduct of Business Agreement)
that were not delivered to Buyer at or prior to the Closing (or the Subsequent
Closing, as applicable) and that were not, as of the Closing Date (or the
Subsequent Closing Date, as applicable), located at the premises that were
transferred to Buyer on such date or within the portion of the Corporate
Headquarters that the Company continues to occupy following the Closing and (ii)
afford Buyer and its Affiliates and Representatives reasonable access, during
normal business hours upon at least five (5) Business Days' advance written
notice, to pre-Closing financial information relating solely to the Business
(and not in any manner (A) relating to the Intellectual Property of DEI, Seller
or their Affiliates or any other matters specifically addressed in the License
and Conduct of Business Agreement or (B) combined with any financial information
of DEI, Seller or their Affiliates) that is readily available (without diligence
or expenditure of money) and in the possession and control of DEI, Seller and
their Affiliates and not already delivered to Buyer pursuant to the preceding
subparagraph (i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Records
Relating to Transition Services</U>. At any time up to ninety (90) days
following the Closing Date, Buyer may, by written notice to DEI and Seller,
request any books, records or other information related to the services to be
provided by Seller or its Affiliates under the Transitional Administrative
Services Agreement, the Transitional Distribution Services Agreement and the
Transitional Information Technology Services Agreement that Buyer reasonably
believes will be required following the Closing in connection with the
transition of the functions performed under such agreements to the Company. DEI
and Seller shall, during the period beginning on the Closing Date and ending on
the Transition Services Termination Date, provide, or cause their Affiliates to
provide, to Buyer such books, records and other information that are so
requested, <U>provided</U>, <U>that</U>, (i) such books, records and other
information are readily available to DEI, Seller or their Affiliates, (ii) the
disclosure of such books, records and other information to Buyer and its
Affiliates is not restricted or prohibited by Contract or applicable Law
(including, without limitation, privacy regulations), and (iii) following the
Closing, the Company shall, within twenty (20) Business Days after receipt of an
invoice therefor from DEI or Seller, via wire transfer of same day funds to an
account designated by DEI or Seller, reimburse DEI, Seller and their Affiliates
for all costs incurred by them in connection with the provision of such books,
records and other information, plus an amount equal to fifteen percent (15%) of
such costs. Buyer and its Affiliates shall have no audit rights with respect to
such reimbursable costs or the calculation thereof under this Section 7.2.3, but
Seller shall provide Buyer with a certification of such costs executed by an
officer of Seller or one of its Affiliates; <U>provided</U>, <U>that</U>,
notwithstanding such certification, Buyer shall not be entitled to receive any
supporting documentation, invoices, receipts, bills, calculations or other
evidence with respect to the determination of such costs nor shall Buyer be
entitled to any inspection, audit or comparable rights with respect to such
certification or the determination of such costs, the foregoing limitations to
apply whether any demand or request is made by Buyer pursuant to the terms
hereof or in connection with any dispute or controversy that may arise hereunder
and any attempted discovery thereof in connection with such dispute or
controversy, whether by way of document production, interrogatories, depositions
or other discovery method. Notwithstanding anything to the contrary contained in
this Section 7.2, to the extent that the books, records and other information
referred to in this Section 7.2.3 are not requested by written notice from Buyer
to DEI and Seller at least thirty (30) days prior to the Closing Date, DEI and
Seller shall not be required to provide to Buyer any such books, records or
other information if (i) neither DEI nor Seller has the necessary, desirable or
appropriate personnel to extract, collect or otherwise transmit such information
to Buyer or (ii) the provision of such books, records or other information is
otherwise impracticable for DEI and/or Seller (in the case of each of
subparagraphs (i) and (ii) as determined by DEI in its sole discretion).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effect of Due Diligence and Related
Matters</U>. USA Purchaser and Canadian Purchaser each represents that it is a
sophisticated Entity that was advised by knowledgeable counsel and financial and
accounting advisors and, to the extent it deemed necessary, other advisors in
connection with this Agreement and has conducted its own independent review and
evaluation of the Company and the Business. Accordingly, USA Purchaser and
Canadian Purchaser each covenants and agrees that (i) there are no
representations or warranties by or on behalf of DEI, Seller or their Affiliates
or Representatives except for those expressly set forth in this Agreement and
the Related Agreements, and, except as stated herein or therein, it has not
relied and will not rely upon any document or written or oral information
(including, without limitation, any projections or other financial data)
furnished to or discovered by it or its Representatives, including, without
limitation, the Confidential Information Memorandum dated September 2003
furnished to TCP, Buyer or their Representatives and any projections, financial
data or other information contained therein, and (ii) to the fullest extent
permitted by Law, the rights and obligations of USA Purchaser and Canadian
Purchaser with respect to the transactions contemplated hereby will be solely as
set forth in this Agreement and the Related Agreements. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Continuing Employee Matters</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Employees of
Business</U>. Each of DEI, Seller and Buyer acknowledges and agrees that (i) all
Continuing Employees will remain employees of the Company immediately following
the consummation of the Membership Unit Acquisition, the Share Acquisition and
the other transactions contemplated hereby, and (ii) following the date hereof
and prior to the Closing Date, <U>TDS Schedule 7.4.1</U> shall not be modified
without the prior written consent of DEI, Seller and Buyer (to be granted or
denied in their respective business judgment), except to the extent necessary to
reflect (a) the voluntary termination of employment by any Continuing Employee
listed on <U>TDS Schedule 7.4.1</U>, (b) the involuntary termination of
employment of any Continuing Employee listed on <U>TDS Schedule 7.4.1</U> not in
violation of Section 6.3 or for cause or any other legal requirement, (c) the
hiring of any employee by the Company not in violation of Section 6.3 or (d) any
change in the position of any Continuing Employee listed on <U>TDS Schedule
7.4.1</U> not in violation of Section 6.3. Buyer represents and warrants to DEI
and Seller that <U>TDS Schedule 7.4.1</U> includes the following Employees and
only the following Employees: (i) all Employees located at the Corporate
Headquarters who have received an Employee Offer Letter, except for any such
Employee who received an Employee Offer Letter but either rejected it or whose
employment with the Company was terminated prior to the date of this Agreement
or is to be terminated prior to the Closing Date, whether voluntarily or
involuntarily, and (ii) all Employees located at the Corporate Headquarters who
shall, if any such Employee has not as of the date hereof received an Employee
Offer Letter, receive an Employee Offer Letter on or prior to the Closing.
Subject to applicable Law, DEI and Seller shall ensure that any Person who is
not a Continuing Employee is no longer employed by the Company upon the Closing
Date, and DEI and Seller shall indemnify and hold Buyer and its Affiliates
harmless from and against any and all Loss arising directly or indirectly from,
out of or based on the termination by TDS USA or TDS Canada of any such Person
who is not a Continuing Employee. Buyer acknowledges that certain of the
Continuing Employees currently are employed by the Company pursuant to visa
petitions, and Buyer acknowledges and agrees that, from and after the Closing,
the Company shall be solely responsible for compliance by the Company and such
Employees with all applicable immigration Laws, including, without limitation,
Laws pertaining to appropriate work authorizations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Obligations
to Continuing Employees; Cessation of Benefits Under Disney Plans</U>. From and
after the Closing, Buyer and its Affiliates shall be subject to the obligations
with respect to the Continuing Employees as set forth in the License and Conduct
of Business Agreement. Buyer acknowledges and agrees that, from and after the
Closing, for purposes of the Disney Plans, the Continuing Employees shall be
treated as employees whose employment with the Company has been terminated;
<U>provided</U>, <U>however</U>, that DEI and Seller or their insurers shall be
responsible for all expenses incurred prior to the Closing by any Continuing
Employee that are reimbursable under any Employee Benefit Plan. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>COBRA
Continuation Coverage</U>. From and after the date hereof and after the Closing
Date, DEI and Seller shall be solely responsible (apart from COBRA premiums
required to be paid by or with respect to "qualified beneficiaries" as such term
is defined in COBRA) for any and all COBRA continuation coverage costs,
liabilities and obligations with respect to any employees of the Company who, as
of the date hereof or at any time before the Closing, have lost coverage under
any Employee Benefit Plan sponsored or maintained by DEI or its ERISA Affiliates
or to which DEI or its ERISA Affiliates are obligated to contribute, which is
subject to COBRA, as a result of a "qualifying event" (as defined in COBRA) that
occurred on or before the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Retention
Program for Continuing Employees</U>. DEI and Seller shall be solely responsible
for all liabilities and obligations arising under the Retention Program incurred
in respect of periods ending on or before December 31, 2004. In the event that
the Closing Date does not occur on or before December 31, 2004, DEI and Seller
shall, at Buyer's sole cost and expense, cause the Retention Program to remain
in effect with respect to the Continuing Employees that are, as of the date
hereof, covered under the terms of the Retention Program until the earlier to
occur of (i) the Closing Date and (ii) February 15, 2005 (the
<B>"Extension Date"</B>). No later than ten (10) Business Days
following submission by DEI or any of its Affiliates of an invoice or other
comparable request for reimbursement to Buyer, Buyer shall pay directly to DEI
or such Affiliates an amount equal to any and all costs and expenses incurred by
DEI or its Affiliates in respect of or in connection with the Retention Program
for such Continuing Employees from January 1, 2005 through and including the
Extension Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Retention
Program for Transition Employees</U>. DEI, Seller and Buyer hereby agree and
acknowledge that a retention program (the <B>"Transition Retention Program"</B>)
relating to certain current employees of the Company that will, following the
Closing, be employed and used by DEI or its Affiliates to provide transition
services to the Company pursuant to the Transitional Administrative Services
Agreement, the Transitional Distribution Services Agreement and the Transitional
Information Technology Services Agreement (such employees, as they exist as of
the Closing Date, the <B>"Transition Employees"</B>), has been (or, as
applicable, will be) established by DEI or its Affiliates pursuant to and in
accordance with the letter agreement (the <B>"Transition Letter Agreement"</B>),
dated August 27, 2004, between TCP and DEI. In consideration for establishing
the Transition Retention Program, subject to the occurrence of the Closing
hereunder, USA Purchaser hereby agrees to cause, and shall cause, TDS USA (or,
as applicable, New TDS LLC) to pay DEI, by wire transfer of immediately
available funds pursuant to wire instructions delivered by DEI to USA Purchaser,
an amount equal to Two Million Dollars ($2,000,000) (the <B>"Retention
Payment"</B>) on the earlier of the date (the <B>"Transition Services
Termination Date"</B>) that is (x) ninety (90) days following the Closing Date
and (y) March 1, 2005. In addition, Buyer, DEI and Seller hereby agree and
acknowledge that (i) DEI shall consult, in good faith, with TCP regarding the
payments to be made to Transition Employees pursuant to, and other financial
components of, the Transition Retention Program; <U>provided</U>, however, that
the final determination of the amount of payments to be made to Transition
Employees pursuant to, and all other components of, the Transition Retention
Program shall be made by DEI in its sole discretion; (ii) the Retention Payment
will be paid by USA Purchaser to DEI regardless of the actual costs and expenses
incurred by DEI or its Affiliates in connection with the Transition Retention
Program; (iii) none of DEI or its Affiliates shall have any duty or obligation
to account to Buyer or its Affiliates for the use of any part of the Retention
Payment by DEI or its Affiliates (<U>provided</U>, <U>that</U>, DEI hereby
agrees that, unless there is a departure of any one (1) or more of the
Transition Employees prior to the Transition Services Termination Date, it shall
allocate, or, as applicable, shall cause its Affiliates to allocate, the entire
amount of the Retention Payment for use in connection with the Transition
Retention Program or other costs and expenses associated with and incurred by
DEI or its Affiliates for providing the transition services described in this
Section 7.4.5 to the Company); and (iv) neither Buyer nor any of its Affiliates
shall have any audit rights with respect to the Transition Retention Program or
the payments made, or other benefits granted, thereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing Date
Payroll</U>. DEI or one of its Affiliates shall, with respect to the Continuing
Employees, issue on the Closing Date or as soon as reasonably practicable
thereafter, a final payroll check to each Continuing Employee for the period
through and including the Closing Date. All payroll checks for periods ending
after the Closing Date shall be issued by the Company, as a Subsidiary of Buyer.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Employee
Indemnification Agreement</U>. The parties hereby acknowledge and agree and, by
executing the Acquisition Agreement Guarantee TCP acknowledges and agrees, that
nothing contained in this Agreement shall modify, limit or restrict in any
manner whatsoever the obligations of TCP under the Employee Indemnification
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Third
Party Beneficiaries</U>. Nothing in this Section 7.4 or elsewhere in this
Agreement will be deemed to make any Continuing Employee or other employee of
the Company a third party beneficiary of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Post-Closing Obligations Regarding Retained
Asset Agreements and Participation Agreements</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event
that, as of the Closing Date, any Retained Asset Agreements have not been
distributed to Seller in connection with the LLC Distribution, Transferred to
Canadian Transferee in connection with the Canadian Transfer or assigned to DEI
or any of its Affiliates (other than the Company), then, from and after the
Closing Date, with respect to each such Retained Asset Agreement: (a) each of
DEI, Seller and Buyer, in good faith cooperation with each other and with DEI
taking the lead in such negotiations, shall, and Buyer shall cause the Company
to, use commercially reasonable efforts to negotiate and complete the assignment
to DEI or any of its Affiliates of such Retained Asset Agreement in the manner
contemplated by Sections 6.9.2 and 6.9.3, unless and until such assignment is
completed or it becomes evident, in DEI's business judgment, that such
assignment is not reasonably practicable without undue cost or delay; (b) for so
long as such Retained Asset Agreement remains unassigned, Buyer shall, and shall
cause the Company and their respective Affiliates to, (i)&#160;take such actions
and execute such documents as may be reasonably necessary, desirable or
requested by DEI or Seller in order to ensure that DEI and its Affiliates shall
enjoy their rights and perform their obligations pursuant to such Retained Asset
Agreement, (ii)&#160;cooperate with DEI and Seller in good faith and using
commercially reasonable efforts in connection with the enforcement and
protection of the rights of DEI and its Affiliates under such Retained Asset
Agreement, (iii)&#160;indemnify and hold DEI and Seller harmless from and
against liabilities arising under such Retained Asset Agreement as a result of
any action or omission by Buyer or any of its Affiliates other than actions or
omissions taken or not taken, as the case may be, in accordance with the
requirements of such Retained Asset Agreement or at the request of DEI, Seller
and/or their Affiliates and (iv)&#160;unless otherwise agreed in writing by DEI
in its sole discretion, not knowingly take any action that would be reasonably
likely to result in any diminishment or elimination of any benefits, or increase
in costs, under any such Retained Asset Agreement to DEI or its Affiliates,
including any amendment or modification thereof (or, if such action is knowingly
taken or done, use its commercially reasonable efforts to cure the same as soon
as reasonably practicable); and (c) DEI and Seller shall indemnify and hold
harmless Buyer from and against liabilities arising under such Retained Asset
Agreement (except to the extent of Buyer's indemnity obligation under
subparagraph (b)(iii) of this Section 7.5). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event
that, as of the Closing Date, TDS USA has not entered into a Monogram
Participation Agreement and/or, as applicable, a ValueLink Participation
Agreement, then, from and after the Closing Date, each of DEI, Seller and Buyer,
in good faith cooperation with each other and with DEI taking the lead in such
negotiations, shall use commercially reasonable efforts to negotiate and cause
TDS USA (and, in the case of the ValueLink Agreement, as applicable as
determined by DEI in its sole discretion, TDS Canada) to enter into (i) a
Monogram Participation Agreement in the manner contemplated by Section 6.9.2,
and/or (ii) a ValueLink Participation Agreement in the manner contemplated by
Section 6.10.3, in the case of each of subparagraphs (i) and (ii), unless and
until it becomes evident, in DEI's business judgment, that execution of such
agreement is not reasonably practicable without undue cost or delay. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Insurance</U>. Buyer acknowledges and agrees
that, as of the Closing Date, DEI, Seller and their Affiliates will terminate
the coverage under all insurance policies and bonds applicable to the Company,
the Business and/or any Employees prior to the Closing, other than any such
insurance policy as to which the insurer is an unrelated third party (i.e., not
DEI or an Affiliate of DEI) and as to which there are no insured parties other
than the Company. After the Closing Date, the Company will not have, and DEI and
Seller will indemnify the Company and Buyer against, any obligations under any
such insurance policies and bonds that have been terminated. Following the
Closing, Buyer shall be solely responsible for providing all insurance coverage
for the Company and the Business, including to the extent required under the
provisions of the License and Conduct of Business Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Corporate Headquarters</U>. DEI and Seller
agree that they shall use their commercially reasonable efforts (other than the
expenditure of money or, except as determined by DEI or Seller in its respective
sole discretion, the amendment or modification of the Corporate Headquarters
Lease) to assign TDS USA's obligations under the Corporate Headquarters Lease to
DEI or one of its Affiliates (other than the Company) and to terminate the
storage license for the related storage space prior to the Closing. If DEI and
Seller are unable to so assign such obligations prior to the Closing, except as
set forth in the Transitional Administrative Services Agreement (pursuant to
which DEI or its Affiliates may grant the Company the right to occupy all or
part of the Corporate Headquarters subject to and in accordance with the terms
of such agreement) (a) DEI and Seller shall be solely responsible for, and shall
indemnify and hold harmless the Company against, all obligations of the "Tenant"
under the Corporate Headquarters Lease and (b) DEI and Seller shall provide a
copy of the Corporate Headquarters Lease to Buyer. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Non-IT Intellectual Property; Disney
Information Technology</U>. Buyer acknowledges and agrees that (a) as of the
Closing, neither the Non-IT Intellectual Property nor the Disney Information
Technology nor any rights thereto will be owned, licensed or controlled by the
Company, (b) neither the Non-IT Intellectual Property nor the Disney Information
Technology nor any rights thereto will be Transferred to Buyer in connection
with the Membership Unit Acquisition or the Share Acquisition, and (c) effective
as of the Closing Date, DEI, Seller and their Affiliates expect to, and may,
terminate all existing arrangements with respect to the Company's use of the
Non-IT Intellectual Property and the Disney Information Technology without any
liability to DEI, Seller or their Affiliates and without payment to the Company.
Accordingly, from and after the Closing Date, none of the Non-IT Intellectual
Property or Disney Information Technology will be available to the Company
except and only to the extent (if at all) provided under the License and Conduct
of Business Agreement and the Transitional Information Technology Services
Agreement, respectively. Notwithstanding the foregoing, the parties agree and
acknowledge that (i) with respect to Disney Information Technology that as of
the date hereof is held by TDS USA or TDS Canada, DEI and Seller shall use (or,
as applicable, shall cause their Affiliates to use) their commercially
reasonable efforts to obtain any Consents necessary for the Transfer of such
Disney Information Technology and to Transfer prior to the Closing to DEI or one
of its Affiliates (other than the Company) such Disney Information Technology,
and (ii) to the extent that notwithstanding DEI's and Seller's use of
commercially reasonable efforts to Transfer (or cause to be Transferred) such
Disney Information Technology to DEI or one of its Affiliates (other than the
Company), such Disney Information Technology cannot be Transferred to DEI or one
of its Affiliates (other than the Company), as determined by DEI in its sole
discretion, whether as a result of the failure to obtain a Consent to Transfer
or otherwise, then such Disney Information Technology shall be deemed to be
"Company Information Technology" for all purposes hereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Transitional Services</U>. Buyer
acknowledges and agrees that all Intercompany Agreements and Arrangements will
be terminated prior to the Closing pursuant to, and to the extent set forth in,
Section 2.1.4 without any liability to DEI, Seller or their Affiliates and
without payment to the Company. Accordingly, from and after the Closing Date,
none of DEI, Seller or their Affiliates will provide any administrative, support
or other services (including, without limitation, payroll, product sourcing,
supply chain, distribution, employee benefits, legal, accounting, treasury and
tax planning services) to the Company except and only to the extent provided
under Section 6.11.3 or under the Transitional Administrative Services Agreement
or the Transitional Distribution Services Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Management and Operation of Disney Retained
Stores</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Management
by Buyer</U>. From and after the Closing Date, Buyer shall (a)&#160;operate the
Deferred Stores (including any Approved Deferred Stores) until the Subsequent
Closing Date or, if no Subsequent Closing occurs, until expiration of the
Subsequent Closing Period, and (b)&#160;operate the Disney Retained Stores
(other than the Flagship Stores) until expiration or termination of the
Transitional Disney Retained Stores Agreement, in each case as provided under
the Transitional Disney Retained Stores Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing of
Deferred Stores and Disney Retained Stores</U>. From and after the Closing Date,
DEI and Seller shall have the right to close and cease operations at any
Deferred Stores (subject to the provisions of Section 6.7.3(b)) and/or Disney
Retained Stores. The closure of and cessation of operations at any such Store
shall be conducted by the Company under the Transitional Disney Retained Stores
Agreement in a commercially reasonable time and manner and in accordance with
such reasonable instructions as DEI and/or its Affiliates shall specify. Buyer
shall, and shall cause TDS USA and/or TDS Canada to, cooperate and comply with
all such instructions in connection with such closure of and cessation of
operations at any such Store. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Actions by Canadian Competition Bureau</U>.
Buyer acknowledges and agrees that DEI, Seller and their Affiliates shall not be
liable in any manner or have any obligation whatsoever, and that Buyer and its
Affiliates shall not be entitled to indemnification or contribution from, or
seek or exercise any other remedy against, DEI, Seller or any of their
Affiliates, in each case with respect to any notice, determination or Action by
the Canadian Competition Bureau challenging the transactions contemplated by
this Agreement, except to the extent that any information provided by DEI,
Seller and their Affiliates either (i) for delivery to the Canadian Competition
Bureau or (ii) that included financial information about TDS Canada in support
of the conclusion stated in Section 6.8.3, contains any material error or
omission that results directly in liability to Buyer or its Affiliates under the
Competition Act. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Post-Closing Audit-Related Information</U>.
Following the Closing, upon reasonable notice from the Company to DEI and to the
extent reasonably requested by Buyer or the Company, DEI and Seller will, within
a reasonable period of time following the Company's request (and, with respect
to the information described in subparagraph (i), not later than thirty (30)
days after the Closing Date, with DEI and Seller acknowledging that such
information in subparagraph (i) has already been requested by Buyer),
(i)&#160;provide pro forma adjustments to the TDS Audited Financial Statements
(along with such supporting documentation for such pro forma adjustments as may
be reasonably requested by Buyer or the Company and readily available to DEI and
Seller without additional diligence or expenditure of money) to reflect the
deletion of the Retained Assets and the Retained Liabilities from such TDS
Audited Financial Statements for the periods and as of the dates of such
financial statements, (ii)&#160;provide (to the extent that such financial
information has not already been provided pursuant to Section 6.2.1) combined,
unaudited quarterly financial information of TDS USA and TDS Canada for the most
recently completed four (4) fiscal quarters prior to the Closing Date, prepared
in accordance with Modified GAAP, (iii) provide (to the extent that such
financial information has not already been provided pursuant to Section 6.2.1)
combined, unaudited monthly financial information of TDS USA and TDS Canada for
each fiscal month included in the most recently completed fiscal year prior to
the Closing Date (provided, that for purposes of clarification, such information
referenced in this subparagraph (iii) shall not necessarily be prepared in
accordance with GAAP or Modified GAAP and no representations or warranties shall
be made, or deemed to be made, with respect to such information by or through
the provision thereof), (iv) provide reasonable cooperation to Buyer and the
Company in connection with the audit (including, without limitation, providing
any management representation letters necessary for such audit with respect to
any fiscal period ending on or prior to the Closing Date) of the combined
balance sheets and the related combined statements of operations and retained
earnings and cash flows of TDS USA and TDS Canada as of and for any periods
beginning on or after October 1, 2003 and ending on or prior to the Closing
Date, <U>provided</U>, <U>that</U>, Buyer or the Company (as applicable) shall
have engaged PWC to conduct the audit of such financial statements and pays for
all of the costs and expenses associated therewith, (v)&#160;authorize and
request PWC to provide its consent to the filing of the TDS Audited Financial
Statements (and any other financial statements audited by PWC and described in
subparagraph (iv) of this Section 7.12) with the SEC to the extent required in
connection with any filings with the SEC by the Company, TCP or their respective
Affiliates in accordance with applicable Law and to issue a comfort letter or
comparable instrument to the Company and its underwriters or investment bankers
with respect to the TDS Audited Financial Statements (and any other financial
statements audited by PWC and described in subparagraph (iv) of this Section
7.12) in connection with any offering of securities of the Company, TCP or their
respective Affiliates not prohibited by the terms of the License and Conduct of
Business Agreement, and (vi) authorize and request PWC to make available to
Buyer and the Company all audit workpapers relating to the TDS Audited Financial
Statements (and any other financial statements audited by PWC and described in
subparagraph (iv) of this Section 7.12), <U>provided</U> that such audit
workpapers will be made available to Buyer and the Company for review purposes
only and Buyer and the Company shall not be permitted to make copies of such
workpapers (except to the extent permitted by PWC in accordance with its
customary business practices). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Initial Equity Capital Investment</U>. On
the Closing Date, immediately following the consummation of the Membership Unit
Acquisition and the Share Acquisition, Buyer shall, or shall cause TCP to,
invest Fifty Million Dollars ($50,000,000) of equity capital in TDS USA in the
form of cash or cash equivalents, representing the first half of the commitment
of One Hundred Million Dollars ($100,000,000) contemplated by the TCP Guaranty
and Commitment. </FONT></P>

<P ALIGN=CENTER><B>ARTICLE VIII<BR>
CONDITIONS OF ACQUISITION</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>General Conditions</U>. The obligations of
the parties to effect the Closing shall be subject to the following conditions
unless waived in writing by the parties:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Legal
Proceedings</U>. No Law shall have been enacted, entered, issued, promulgated or
enforced by any Governmental Entity that prohibits or restricts or would (if
successful) prohibit or restrict the transactions contemplated by this
Agreement. No Governmental Entity shall have notified any party to this
Agreement that consummation of the transactions contemplated by this Agreement
would constitute a violation of any Law of any jurisdiction and/or that it
intends to commence proceedings to restrain or prohibit such transactions or
force divestiture or rescission, unless such Governmental Entity shall have
withdrawn such notice and abandoned any such proceedings prior to the time that
otherwise would have been the Closing Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Permits</U>.
With respect to the transactions contemplated by this Agreement, (i) any
applicable waiting period under the Hart-Scott-Rodino Act shall have expired or
been terminated, and (ii) all Permits required to be obtained from any
Governmental Entity (including, without limitation, any required approval under
the Investment Canada Act) shall have been received or obtained. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Conditions to Obligations of Buyer</U>. The
obligations of Buyer to effect the Closing shall be subject to the following
conditions, except to the extent waived in writing by Buyer: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Representations,
Warranties and Covenants of DEI and Seller</U>. (a)&#160;Except as would not
constitute a Material Adverse Event, the representations and warranties of DEI
and Seller herein contained shall be true and correct at the Closing Date with
the same effect as though made at such time (except (i) that any representation
or warranty of DEI and Seller contained herein that is already qualified by
"materiality" or "Material Adverse Event" shall be deemed not to be so qualified
for purposes of this Section&#160;8.2.1, so that there will be no duplication
between such qualifier contained within such representation or warranty and the
"Material Adverse Event" qualifier contained in this subparagraph (a), (ii) for
changes resulting from actions not prohibited under or that have been approved
by Buyer in accordance with Section 6.3 and (iii) that any representation or
warranty expressly made as of a particular date shall remain true and correct as
of such date); (b) DEI and Seller shall have complied in all material respects
with all covenants and conditions required by this Agreement to be complied with
by them at or prior to the Closing Date; and (c) DEI and Seller shall have
delivered to Buyer a certificate of DEI and Seller in form and substance
reasonably satisfactory to Buyer, dated the Closing Date and signed by duly
authorized officers of DEI and Seller, respectively, to the effect of the
preceding subparagraphs (a) and (b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Minimum
Number of Core Store Consents</U>. The requisite Consents for Consent Required
Core Stores having Lease Liabilities representing, in the aggregate, at least
eighty-five percent (85%) of the Aggregate Lease Liability shall have been
obtained. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Related
Agreements</U>. Buyer shall have received the License and Conduct of Business
Agreement, duly executed by DEI or the Affiliates of DEI who are parties
thereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>TDS Audited
Financial Statements</U>. Buyer shall have received the TDS Audited Financial
Statements. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Legal
Opinion of Counsel for DEI and Seller</U>. Buyer shall have received legal
opinions of counsel for DEI and Seller, Irell &amp; Manella LLP and McCarthy
T&#233;trault LLP, addressed to Buyer, in substantially the forms attached
hereto as <U>Annex E-1</U> and <U>Annex E-2</U>, respectively. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Good
Standing Certificates</U>. Buyer shall have received certificates of good
standing (or with respect to TDS Canada, a certificate of status) from the
jurisdiction of incorporation or organization (as applicable) of, and with
respect to, Seller, DEI, TDS USA and TDS Canada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Conditions to Obligations of DEI and
Seller</U>. The obligations of DEI and Seller to effect the Closing shall be
subject to the following conditions, except to the extent waived in writing by
DEI and Seller: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Representations,
Warranties and Covenants of Buyer</U>. (a) The representations and warranties of
Buyer herein contained shall be true and correct in all material respects at the
Closing Date with the same effect as though made at such time (except (i) that
any representation or warranty of Buyer contained herein that is already
qualified by "materiality" shall be deemed not to be so qualified for purposes
of this Section 8.3.1, so that there will be no duplication between such
qualifier contained within such representation or warranty and the "in all
material respects" qualifier contained in this subparagraph (a) and (ii) that
any representation or warranty expressly made as of a particular date shall
remain true and correct as of such date); (b) Buyer shall have complied in all
material respects with all covenants and conditions required by this Agreement
to be complied with by it at or prior to the Closing Date; and (c) Buyer shall
have delivered to DEI and Seller a certificate of Buyer in form and substance
reasonably satisfactory to DEI and Seller, dated the Closing Date and signed by
a duly authorized officer of Buyer, to the effect of the preceding subparagraphs
(a) and (b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Minimum
Number of Core Store Consents</U>. The requisite Consents for Consent Required
Core Stores having Lease Liabilities representing, in the aggregate, at least
eighty-five percent (85%) of the Aggregate Lease Liability shall have been
obtained; <U>provided</U>, that, if the foregoing minimum requirement has been
satisfied and the Closing occurs prior to November 30, 2004 but there remain one
(1) or more Deferred Leases with respect to which the parties will attempt to
obtain Consents to Transfer during the Subsequent Closing Period and the
Subsequent Closing occurs with respect to such Approved Deferred Lease, then
Buyer agrees that it shall defend, indemnify and hold DEI, Seller, their
respective Affiliates and the officers, directors, agents, representatives,
employees, successors and assigns of DEI, Seller and their respective
Affiliates, forever harmless from and against any and all Loss arising from and
after the date of the Subsequent Closing imposed on, incurred or suffered by or
asserted against any such indemnified Person arising directly or indirectly
from, out of or based on any Approved Deferred Lease for which the Consent to
Transfer was obtained after the Closing Date but on or prior to November 30,
2004, and such indemnification obligation shall survive indefinitely.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Approval of
Buyer's Capitalization, Financing, Liquidity and Governing Documents</U>. DEI
and Seller shall have received and approved Buyer's Closing Capitalization
Table, Buyer's Liquidity Plan and Buyer's Governing Documents, if required
pursuant to Sections 6.4.1, 6.4.2 and 6.4.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Retained
Asset Agreements</U>. TDS USA and TDS Canada, as applicable, shall have
distributed to Seller in connection with the LLC Distribution, Transferred to
Canadian Transferee in connection with the Canadian Transfer or assigned to DEI
or its Affiliates (other than the Company) each of the Retained Asset Agreements
and shall have obtained all Consents of third parties necessary in connection
therewith. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Related
Agreements and Other Documents</U>. DEI and Seller shall have received the
License and Conduct of Business Agreement, the TCP Guaranty and Commitment and
the TCP Intercompany Services Agreement, each duly executed by the Company, TCP,
Buyer or the Affiliates of Buyer who are parties thereto (including, in the case
of the TCP Guaranty and Commitment, those Affiliates of Buyer who become
Obligors). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Independent
Directors</U>. There shall be two (2) Persons meeting the requirements of
"Independent Directors" pursuant to Section 6.17 who have been selected by DEI,
Seller and Buyer in accordance with Section 6.17 and with respect to which DEI
and Seller shall have received (from such Persons in the case of the following
subparagraphs (i) and (ii) and from Buyer in the case of the following
subparagraphs (iii) and (iv)) evidence satisfactory to DEI and Seller in their
respective business judgment that (i) with respect to Buyer, TDS USA (or, as
applicable, New TDS LLC) and each of their respective Subsidiaries (other than
TDS Canada), such Persons have agreed and, on the Closing Date immediately
following the consummation of the Membership Unit Acquisition and the Share
Acquisition, are prepared to serve as directors (or in a comparable capacity in
the case of any limited liability company or other Entity) of such Entities,
(ii) with respect to TDS Canada (or, as applicable, its successor), such Persons
have agreed and are prepared to serve as directors of TDS Canada within twenty
(20) Business Days following the Closing Date (or, if and only if the Canada
Reincorporation is delayed beyond the twentieth (20th) Business Day following
the Closing as a result of an action taken, or failed to be taken, in error on
or prior to the Closing by DEI or its Affiliates and having the effect
specifically described in the first sentence of Section 2.6.2, then on the
Canada Reincorporation Date), (iii) on the Closing Date immediately following
the consummation of the Membership Unit Acquisition and the Share Acquisition,
Buyer, TDS USA, New TDS LLC and each of their respective Subsidiaries (other
than TDS Canada) are prepared to elect such Persons as directors (or to
comparable positions in the case of any limited liability company or other
Entity) and (iv) within twenty (20) Business Days after the Closing Date (or, if
and only if the Canada Reincorporation is delayed beyond the twentieth (20th)
Business Day following the Closing as a result of an action taken, or failed to
be taken, in error on or prior to the Closing by DEI or its Affiliates and
having the effect specifically described in the first sentence of Section 2.6.2,
then on the Canada Reincorporation Date) TDS Canada (or, as applicable, its
successor) will be prepared to elect such Persons as directors (or to comparable
positions in the case of any limited liability company or other Entity).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Initial
Equity Capital Investment</U>. Buyer shall have delivered to DEI and Seller
evidence satisfactory to DEI and Seller in their respective business judgment
that, on the Closing Date, immediately following the consummation of the
Membership Unit Acquisition and the Share Acquisition, Buyer or TCP will be in a
position to make a Fifty Million Dollar ($50,000,000) investment of equity
capital in TDS USA in the form of cash or cash equivalents pursuant to Section
7.13 of this Agreement and as contemplated by the TCP Guaranty and Commitment.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Solvency
Opinion</U>. DEI and Seller shall have received an opinion satisfactory to DEI
and Seller in their respective business judgment regarding the solvency of TDS
USA following the consummation of the transactions contemplated by this
Agreement pursuant to Section 6.12. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>WARN Act
Compliance</U>. With respect to the employees of the Company whose employment
will be terminated by the Company on or prior to the Closing in connection with
or as a result of the transactions contemplated hereby, the requirements of the
Worker Adjustment and Retraining Notification Act shall have been satisfied as
determined by DEI and Seller in their respective business judgment, including,
without limitation, the giving of all required notices and the expiration and
tolling of all applicable notice periods thereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Capitalization
of TCP</U>. As of the Closing Date, (i) no Disqualified Person who is the
Largest TCP Stockholder or the Largest TCP Affiliate Stockholder shall own,
beneficially or of record, more than nineteen percent (19%) of any tranche of
outstanding voting TCP Securities or outstanding voting TCP Affiliate
Securities; (ii) no Disqualified Person who is not the Largest TCP Stockholder
or the Largest TCP Affiliate Stockholder shall own, beneficially or of record,
more than twenty-five percent (25%) of any tranche of outstanding voting TCP
Securities or outstanding voting TCP Affiliate Securities; and (iii)
Disqualified Persons, taken together in the aggregate, without regard to whether
any such Disqualified Person is or is not the Largest TCP Stockholder or the
Largest TCP Affiliate Stockholder, shall not own, beneficially or of record,
more than thirty-three percent (33%) of any tranche of outstanding voting TCP
Securities or outstanding voting TCP Affiliate Securities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Virginia
Franchise Qualification</U>. DEI and Seller shall have received written notice
from the applicable Governmental Entity that TDS Franchising has been qualified
to grant a franchise of the Business under the applicable franchise regulations
of the State of Virginia. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Legal
Opinion of Buyer's Counsel</U>. DEI and Seller shall have received legal
opinions of Buyer's counsel, Stroock &amp; Stroock &amp; Lavan LLP and Stikeman
Elliot LLP, addressed to DEI and Seller, in substantially the forms attached
hereto as <U>Annex F-1</U> and <U>Annex F-2</U>, respectively. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Good
Standing Certificates</U>. DEI and Seller shall have received certificates of
good standing from the jurisdiction of incorporation or organization (as
applicable) of, and with respect to, USA Purchaser and Canadian Purchaser.
</FONT></P>

<P ALIGN=CENTER><B>ARTICLE IX<BR>
TERMINATION</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Termination of Agreement</U>. This
Agreement may be terminated at any time before the Closing as follows and in no
other manner:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Mutual
Consent</U>. By mutual consent in writing of Buyer, on the one hand, and DEI and
Seller, on the other hand.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Conditions
to Buyer's Performance Not Met</U>. By Buyer by written notice to DEI and Seller
if any event occurs that would render impossible the satisfaction, on or before
the Termination Date, of one or more conditions to the obligations of Buyer to
consummate the transactions contemplated by this Agreement as set forth in
Section 8.1 or 8.2; <U>provided</U>, that the right to terminate this Agreement
under this Section 9.1.2 shall not be available to Buyer if Buyer's actions or
omissions resulted in such impossibility and Buyer's actions or omissions
constitute a material breach of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Conditions
to DEI's and Seller's Performance Not Met</U>. By DEI and Seller by written
notice to Buyer if any event occurs that would render impossible the
satisfaction, on or before the Termination Date, of one or more conditions to
the obligations of DEI or Seller to consummate the transactions contemplated by
this Agreement as set forth in Section 8.1 or 8.3; <U>provided</U>, that the
right to terminate this Agreement under this Section 9.1.3 shall not be
available to DEI or Seller if the actions or omissions of DEI or Seller resulted
in such impossibility and the actions or omissions of DEI or Seller constitute a
material breach of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Material
Breach</U>. By (i) Buyer if (A) it has not breached any of its representations,
warranties or covenants under this Agreement in any material respect and (B)
there has been a breach on the part of DEI or Seller in any of its
representations or warranties set forth herein in a manner that would constitute
a Material Adverse Event (except that any representation or warranty of DEI or
Seller contained herein that is already qualified by "materiality" or "Material
Adverse Event" shall be deemed not to be so qualified for purposes of this
Section 9.1.4(i)(B), so that there will be no duplication between such qualifier
contained within such representation or warranty and the "Material Adverse
Event" qualifier set forth in this Section 9.1.4(i)(B)) or a breach on the part
of DEI or Seller in any of its covenants set forth herein in any material
respect, in either case that has not been cured within twenty (20) Business Days
after receipt by DEI and/or Seller of notice (including a reasonably detailed
description of such breach) from Buyer of an intention to terminate if such
breach continues, or (ii) DEI and Seller if (X) they have not breached any of
their representations or warranties under this Agreement in a manner
constituting a Material Adverse Event (except that any representation or
warranty of DEI or Seller contained herein that is already qualified by
"materiality" or "Material Adverse Event" shall be deemed not to be so qualified
for purposes of this Section 9.1.4(ii)(X), so that there will be no duplication
between such qualifier contained within such representation or warranty and the
"Material Adverse Event" qualifier set forth in this Section 9.1.4(ii)(X)) and
they have not breached any of their covenants under this Agreement in any
material respect and (Y) there has been a breach on the part of Buyer in any of
its representations or warranties set forth herein in any material respect
(except that any representation or warranty of Buyer contained herein that is
already qualified by "materiality" shall be deemed not to be so qualified for
purposes of this Section 9.1.4(ii)(Y), so that there will be no duplication
between such qualifier contained within such representation or warranty and the
"in any material respect" qualifier set forth in this Section 9.1.4(ii)(Y)) or a
breach on the part of Buyer in any of its covenants set forth herein in any
material respect, in either case that has not been cured within twenty (20)
Business Days after receipt by USA Purchaser and/or Canadian Purchaser of notice
(including a reasonably detailed description of such breach) from DEI or Seller
of an intention to terminate if such breach continues. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Outside
Date</U>. By DEI and Seller, on the one hand, or Buyer, on the other hand, if
the Closing has not occurred by February 15, 2005 (the <B>"Termination
Date"</B>); <U>provided</U>, that the right to terminate this Agreement under
this Section 9.1.5 shall not be available to either such party if its actions or
omissions resulted in the failure of the Membership Unit Acquisition or the
Share Acquisition to occur on or before the Termination Date and such actions or
omissions constitute a material breach of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Superior
Proposal</U>. By DEI or Seller, if, prior to the Closing, DEI, Seller or their
Affiliates enter into a definitive agreement for a Superior Proposal under
Section 6.14; <U>provided</U>, that, in such instance, DEI and Seller shall pay
to Buyer, within five (5) Business Days following the date on which DEI or
Seller enters into such agreement, by wire transfer of immediately available
funds to such account as Buyer shall designate in writing to DEI and Seller, an
amount equal to Twenty Million Dollars ($20,000,000), plus the reasonable and
documented out-of-pocket expenses (including, without limitation, legal,
accounting, investment banking, consulting, travel and other reasonable and
documented out-of-pocket expenses) of Buyer and its Affiliates incurred directly
as a result of the negotiation and preparation of this Agreement and the
transactions contemplated hereby. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effect of Termination</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If this
Agreement is terminated under any provision of Section 9.1, all further
obligations of the parties under this Agreement shall terminate;
<U>provided</U>, that no termination of this Agreement shall relieve any party
of any liability for a breach of this Agreement or be deemed to constitute a
waiver of any available right or remedy for any such breach. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
anything to the contrary contained herein, the provisions of this Article IX and
Article XI (other than Sections 11.3 and 11.8 thereof), shall be deemed to
survive such termination of this Agreement. </FONT></P>

<P ALIGN=CENTER><B>ARTICLE X<BR>
INDEMNIFICATION</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Survival</U>. The representations and
warranties of each party will survive the Closing but will expire at 5:00 p.m.
Los Angeles time on April 30, 2006; <U>provided</U>, that the Fundamental
Representations other than the representations and warranties set forth in
Section 4.4 will survive the Closing indefinitely and the representations and
warranties set forth in Section 4.4 will survive the Closing until the earlier
to occur of the expiration of any statute of limitations applicable thereto (or,
in the case of TDS Canada, the expiration of any period during which a
recognized document assessing liability for Tax may be issued by a Governmental
Entity) and the final determination of any Tax matter referred to therein,
<U>provided</U>, that, without the prior written consent of DEI in its sole
discretion, Buyer shall not cause or permit the Company to provide, and the
Company shall not provide, any Governmental Entity any waiver or extension of
such time in respect of such period. Except as otherwise provided in this
Agreement, all covenants, agreements and indemnities set forth in this Agreement
shall survive the Closing indefinitely. No party will be responsible with
respect to any Loss or indemnification with respect to any breach of such
party's representations, warranties or covenants unless such party receives
notice of the Loss or a potential Loss with respect to such breach before such
representation, warranty or covenant expires in accordance with this Section
10.1. With respect to any such Loss as to which notice is received before the
expiration of a particular representation, warranty or covenant, the party
responsible for such representation, warranty or covenant will remain
responsible for indemnification notwithstanding the subsequent expiration of
such representation, warranty or covenant. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Indemnification</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;



&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>General
Indemnity by DEI and Seller in Favor of Buyer</U>. Subject to Sections 10.4 and
10.5, DEI and Seller, jointly and severally, shall defend, indemnify and hold
Buyer and each of its Affiliates and the officers, directors, agents,
representatives, employees, successors and assigns of each, forever harmless
from and against any and all Loss imposed on, incurred or suffered by or
asserted against the Persons hereby required to be indemnified (but not against
any of the same to the extent that a Buyer Disqualifying Event was the cause of
such Loss) arising directly or indirectly from, out of or based on (i) any
breach of any representation or warranty made by DEI or Seller in Article IV,
(ii) any failure by DEI or Seller to perform any covenant of DEI or Seller,
respectively, set forth in this Agreement, including, without limitation, any
indemnification obligations under Sections 6.7.1(d), 7.4.1, 7.5 and 7.7, (iii)
any liability arising under or relating to the Retained Assets and the Retained
Asset Agreements (except to the extent of Buyer's indemnification obligation
under Section 7.5.1(b)(iii)), (iv) any liability arising under or relating to
the U.K. Lease Guarantees, (v) the Indemnified Actions, (vi) any liability
arising under or relating to the lease for any Store closed by the Company at
any time prior to the Closing Date, (vii) any escheat liability of the Company
under state unclaimed property laws with respect to matters arising prior the
Closing (including, without limitation, sales of gift certificates and other
transactions occurring prior to the Closing, regardless of when the obligation
to file an unclaimed property report arises), (viii) any liability (A) relating
to any employee or former employee of the Company that is not a Continuing
Employee or (B) arising under or relating to any Employee Benefit Plan
(including, without limitation, any Company Plans) sponsored or maintained by
DEI or its ERISA Affiliates, or to which DEI or its ERISA Affiliates are
obligated to contribute, with respect to service of employees of the Company
performed before the Closing Date for the Company or for DEI or its ERISA
Affiliates, (ix) the Supplemental Disclosure Items, (x) ** and (xi) any Actions
asserted against either TDS USA or TDS Canada that arise directly from and
relate solely to the incident reports set forth on
<U>TDS Schedule 10.2.1</U>. </FONT></P>


<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Tax Indemnity by DEI and Seller in Favor of Buyer</U>. In addition to (but
not in duplication of) the indemnification provided for in Section 10.2.1, each
of DEI and Seller shall jointly and severally indemnify the Company and Buyer
and hold them harmless from and against any Loss attributable to (i) Taxes (or
the non-payment thereof) of or relating to the Company or its income, operations
or assets for all taxable periods ending on or before the Closing Date, (ii) the
portion allocable to the period through the Closing Date of any Taxes of or
relating to the Company, its income, operations or assets for any taxable period
that includes, but does not end on, the Closing Date, (iii) any liability of the
Company under Treasury Regulations &#167; 1.1502-6 (or any similar provision of
state, local or foreign law) for income taxes of any entity other than the
Company and (iv) Taxes of any Person (other than the Company) imposed on the
Company as a transferee or successor, by contract or pursuant to any law, rule
or regulation, which Taxes relate to an event or transaction occurring before
the Closing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Employee Benefits Indemnity by DEI and Seller in Favor of Buyer</U>. In
addition to (but not in duplication of) the indemnification provided for in
Section 10.2.1, each of DEI and Seller shall jointly and severally indemnify the
Company and Buyer and hold them harmless from and against any Loss arising under
or relating to any Employee Benefit Plan sponsored or maintained by DEI or its
ERISA Affiliates, or to which DEI or its ERISA Affiliates are obligated to
contribute, with respect to the participation in such Employee Benefit Plan (or
actual or alleged improper failure to participate in such Employee Benefit Plan)
of any individual other than an individual who is, or ever was, an Employee.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>General Indemnity by Buyer in Favor of DEI and Seller</U>. Subject to
Sections 10.4 and 10.5, Buyer shall defend, indemnify and hold DEI, Seller and
each of their Affiliates and the officers, directors, agents, representatives,
employees, successors and assigns of each, forever harmless from and against any
and all Loss imposed on, incurred or suffered by or asserted against the Persons
hereby required to be indemnified (but not against any of the same to the extent
that a Seller Disqualifying Event was the cause of such Loss) arising directly
or indirectly from, out of or based on (i) any breach of any representation or
warranty made by Buyer in Article V, (ii) any failure by Buyer to perform any
covenant of Buyer set forth in this Agreement, including, without limitation,
any indemnification obligations under Sections 6.1, 6.2.3(c)(iii), 6.11.2,
6.11.8, 6.11.12, 7.5 and 8.3.2, (iii) any liability arising under or relating to
any notice, determination or Action by the Canadian Competition Bureau
challenging the transactions contemplated by this Agreement (other than
liability covered by the exception in Section 7.11) and (iv) from and after the
Subsequent Closing Date, the Approved Deferred Leases, the Approved Deferred
Stores and the Store-Related Assets and Liabilities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Indemnification Procedure</U>. The
indemnification obligations under this Agreement will be subject to the
following procedures:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Either party seeking indemnification under this Agreement (the <B>"Indemnified
Party"</B>) shall give notice to the party required to provide indemnification
hereunder (the <B>"Indemnifying Party"</B>) promptly after the Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought hereunder,
and the Indemnified Party shall permit the Indemnifying Party (at the expense of
the Indemnifying Party), if it acknowledges in writing its liability with
respect to defense costs, to assume the defense of any claim or litigation
resulting therefrom; <U>provided</U>, that: (i) no such notice shall be required
with respect to the Actions listed on <U>Schedule 4.9</U>; (ii)&#160;the
Indemnified Party may participate in such defense, represented by counsel of the
Indemnified Party's own choosing, but only at the Indemnified Party's own cost
and expense, except with respect to any claim or litigation by or with a
Governmental Entity involving or relating to any Tax matter; and (iii)&#160;the
omission by the Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its indemnification obligations hereunder
except to the extent that such omission results in a failure of actual notice to
the Indemnifying Party and the Indemnifying Party is actually prejudiced or
damaged as a result of such failure to give notice. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Indemnifying Party shall not, except with the written consent of the Indemnified
Party, consent to entry of any judgment or administrative order or enter into
any settlement or a compromise that would bind the Indemnified Party if such
judgment, administrative order, settlement or compromise (i) does not include as
an unconditional term thereof the giving by the claimant or plaintiff to the
Indemnified Party of a release from all liability with respect to such claim or
litigation or (ii)&#160;would require any admission of wrongdoing on the part of
the Indemnified Party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event that the Indemnifying Party does not acknowledge in writing its
indemnification obligation hereunder and accept the defense of any matter as
above provided within ten (10) Business Days following the receipt of written
notice of the Indemnified Party of any such matter, the Indemnified Party,
without waiving any rights under this Article X, shall have the full right to
defend against any such claim or litigation at the reasonable expense of the
Indemnifying Party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
amount of any indemnification payable by the Indemnifying Party to the
Indemnified Party under this Article X will be reduced by (i) any insurance
proceeds received by the Indemnified Party in connection with or related to the
Loss or the circumstances giving rise to the Loss, (ii) any Tax credit,
deduction, reduction or other comparable benefit accruing to or arising in favor
of the Indemnified Party in accordance with GAAP that results from the Loss, and
(iii) in the event Buyer is the Indemnified Party, the amount of any accrual or
other liability (contingent or otherwise) reflected as a Current Liability on
the Final Closing Balance Sheet and/or the Final Subsequent Closing Balance
Sheet that relates to the Loss or the circumstances giving rise to the Loss.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Basket</U>. DEI and Seller, on the
one hand, and Buyer, on the other hand, shall not be liable for any Loss with
respect to any breach of its respective Operational Representations (except any
Loss resulting directly from the Supplemental Disclosure Items covered by
Section 10.2.1(ix)) arising from a claim from a third party (collectively,
<B>"Third Party Claims"</B>) or from a direct claim by one party against the
other (collectively, <B>"Direct Claims"</B>), until the aggregate amount of all
such Third Party Claims and Direct Claims arising from breaches of its
respective Operational Representations for which such party would otherwise be
responsible exceeds One Million Dollars ($1,000,000) (the <B>"Basket"</B>). If
the aggregate amount of such Third Party Claims and Direct Claims arising from
breaches of its respective Operational Representations for which DEI and Seller,
on the one hand, or Buyer, on the other hand, is responsible exceeds the Basket,
then DEI and Seller, on the one hand, or Buyer, on the other hand, will be
responsible only for the amount of such Third Party Claims and Direct Claims
that exceeds the Basket. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Maximum Liability</U>. DEI and
Seller, on the one hand, and Buyer, on the other hand, shall not be liable for
any Third Party Claims or Direct Claims arising from breaches of its respective
Operational Representations (except any Loss resulting directly from the
Supplemental Disclosure Items covered by Section 10.2.1(ix)) to the extent that
the aggregate amount of all such Third Party Claims and Direct Claims against
such party exceeds Twenty Million Dollars ($20,000,000). </FONT></P>

<P ALIGN=CENTER><B>ARTICLE XI<BR>
GENERAL</B></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Entire Agreement</U>. The provisions
contained herein (including any annexes, schedules and documents attached hereto
or delivered herewith), in the Related Agreements and/or in any other letter
agreement entered into in order to facilitate, but not to consummate, the
transactions contemplated by this Agreement, constitute the entire agreement
among the parties hereto with respect to the subject matter hereof and supersede
and replace any and all previous agreements among the parties, whether written
or oral, with respect to such subject matter. No statement or inducement with
respect to the subject matter hereof by any party hereto or by any agent or
representative of any party hereto that is not contained in this Agreement shall
be valid or binding among the parties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Annexes and Schedules</U>. The annexes and
schedules to this Agreement, as designated herein and attached hereto or
delivered separately under the terms hereof (including the TDS Schedules and the
Buyer Schedules), shall each be deemed to form an integral part of this
Agreement and to be incorporated herein as if herein set out in full.
Capitalized terms used in the annexes and schedules (including the TDS Schedules
and the Buyer Schedules) and not otherwise defined therein shall have the
respective meanings ascribed to them in this Agreement. The inclusion of any
information in any TDS Schedules shall not be deemed to be an admission or
acknowledgment by any party that such information is required to be listed on
such TDS Schedules or is material to or outside the ordinary course of the
business of the Company. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Further Assurances</U>. Each party will use
its commercially reasonable efforts to cause all conditions to its obligations
hereunder to be timely satisfied and to perform and fulfill all obligations on
its part to be performed and fulfilled under this Agreement, to the end that the
transactions contemplated by this Agreement shall be effected substantially in
accordance with its terms as reasonably practicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Amendments</U>. Except as otherwise
provided herein, no provision of this Agreement may be modified, supplemented,
or amended except by a written instrument duly executed by each of the parties
hereto. Any such modifications, supplements or amendments shall not require
additional consideration to be effective. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Assignment</U>. Neither this Agreement
nor any rights or obligations under it are Transferable (directly, indirectly,
by operation of law, change of control (<U>e.g.</U>, merger, consolidation,
amalgamation, stock (or share) sale, sale of substantially all assets), pledge,
hypothecation or otherwise) by either party without the prior written consent of
the other party, which consent may be granted or withheld in each party's sole
discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effect of Headings</U>. The headings and
subheadings of the sections of this Agreement are inserted for convenience of
reference only and shall not control or affect the meaning or construction of
any of the agreements, terms, covenants or conditions of this Agreement in any
manner. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Counterparts; Facsimile Signatures</U>.
This Agreement and any other agreement or document delivered hereunder may be
executed in two or more counterparts, each of which shall be deemed an original
but all of which together shall constitute one and the same instrument.
Facsimile signatures to this Agreement and any other agreement or document
delivered hereunder shall be effective. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Publicity and Reports</U>. DEI, Seller and
Buyer shall coordinate all publicity relating to the transactions contemplated
by this Agreement, and no party shall issue, or permit its Affiliates to issue,
any press release, publicity statement or other public notice relating to this
Agreement, or the transactions contemplated by this Agreement, without obtaining
the prior written consent of the other party; <U>provided</U>, that nothing
herein will prohibit either party from issuing or causing publication of any
press release, publicity statement or other public notice to the extent that
such action is required by, or is determined to be advisable by such party in
its business judgment under, applicable Law or the regulations of any securities
exchange, securities trading system or similar regulatory body applicable to
such party or its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Confidentiality</U>. Except as otherwise
required by any applicable Law or any regulation of any securities exchange,
securities trading system or similar regulatory body, Buyer, on the one hand,
and DEI and Seller, on the other hand, agree not to disclose to any third party
(other than to their Affiliates and their and their Affiliates' Representatives
on a need-to-know basis only) or permit any third party to disclose or use
(other than the right of DEI, Seller or Buyer or their Affiliates or their and
their Affiliates' respective Representatives to use for purposes of this
Agreement and the Related Agreements) any non-public, confidential or
proprietary information (the <B>"Confidential Information"</B>) that either
party or its Affiliates or any of its or its Affiliates' Representatives makes
available to the other party or its Affiliates or any of its or its Affiliates'
Representatives in connection with this Agreement, including any Confidential
Information disclosed by one party to the other party in connection with this
Agreement at any time prior to the date hereof. Each of Buyer, on the one hand,
and DEI and Seller, on the other hand, further agree not to use any such
Confidential Information of the other in violation of any applicable securities
Laws, including, without limitation, prohibitions thereunder pertaining to
trading on material inside information. Such Confidential Information shall
include the negotiations leading to this Agreement, the terms and conditions
(including economic, legal and other terms) of this Agreement and any agreement
referred to herein, information that one party may have caused to deliver to the
other party that the delivering party has designated as "Confidential" or
"Proprietary" or in like words or information that is generally treated as
proprietary (such as financial and operational information), whether or not in
written form and whether or not designated as confidential. Confidential
Information shall not include information that: (i) is or becomes publicly known
(other than as a result of a breach of this Agreement or any other legal duty by
the receiving party, its Affiliates or its or its Affiliates' Representatives),
(ii) is lawfully received by the receiving party from a third party on a
non-confidential basis, which third party is not to the Knowledge of the
receiving party bound in a confidential relationship with the disclosing party,
or (iii) is generated independently by or for the receiving party without the
use of Confidential Information of the disclosing party. If a receiving party,
its Affiliates or its or its Affiliates' Representatives are requested or
required to disclose any of the Confidential Information of a disclosing party
in an investigatory, legal, regulatory or administrative proceeding, such
receiving party will, to the extent possible, provide the disclosing party with
prompt notice thereof and, except in the case of a Tax Proceeding, the
disclosing party may seek a protective order or other appropriate remedy. If no
such order or remedy is obtained, then the receiving party may, without
liability hereunder, disclose in such proceeding that portion of the
Confidential Information of the disclosing party that the receiving party's
legal counsel has advised the receiving party it is legally required to
disclose. Each of the parties hereto agrees that it shall be responsible for any
disclosure of Confidential Information by its Affiliates and its and its
Affiliates' Representatives that would constitute a breach of this Section 11.9.
The provisions of, and the rights and obligations set forth in, this Section
11.9 shall be in addition to, and not in lieu of, the provisions, rights and
obligations set forth in the Confidentiality Agreement, which Confidentiality
Agreement shall remain in effect pursuant to its terms. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Third Party Beneficiaries</U>. Nothing
in this Agreement is intended, or shall be deemed to, confer any rights or
benefits upon any Person other than the parties hereto or to make or render any
such other Person a third-party beneficiary of this Agreement, except to the
extent that an Affiliate of either party or any officers, directors, agents,
representatives, employees, successors or assigns of a party or any of its
Affiliates have any rights (including a right to be indemnified pursuant to
Article X) under this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notices</U>. Unless otherwise specified
herein, all notices, requests, demands, consents and other communications
hereunder shall be transmitted in writing and shall be deemed to have been duly
given when hand delivered, or upon delivery when sent by express mail, courier
or other recognized overnight mail or next day delivery service, charges
prepaid, or three (3) Business Days following the date mailed when sent by
registered or certified United States mail, postage prepaid, return receipt
requested, or when deposited with a public telegraph company for immediate
transmittal, charges prepaid, or when sent by facsimile, with a confirmation
copy sent by recognized overnight mail or next day delivery, charges prepaid,
addressed as follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>If
to DEI and Seller, addressed to:</B></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>Disney Enterprises, Inc.<BR>
500 South Buena Vista Street<BR>
Burbank, California 91521-1030<BR>
Facsimile: (818) 569-5146<BR>
Attention: General Counsel</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>with copies (which shall not constitute notice) to:</B></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>The Walt Disney Company<BR>
500 South Buena Vista Street<BR>
Burbank, California 91521-1018<BR>
Facsimile: (818) 556-3889<BR>
Attention: Chief Financial Officer<BR>
<BR>
and<BR>
<BR>
Irell &amp; Manella LLP<BR>
1800 Avenue of the Stars, Suite 900<BR>
Los Angeles, California 90067<BR>
Facsimile: (310) 203-7199<BR>
Attention: Peter Juzwiak, Esq.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>If
to Buyer, addressed to:</B></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>Hoop Holdings, LLC<BR>
Hoop Canada Holdings, Inc.<BR>
c/o The Children's Place Retail Stores, Inc.<BR>
915 Secaucus Road<BR>
Secaucus, New Jersey  08540<BR>
Facsimile: (201) 808-5637<BR>
Attention: General Counsel</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>with copies (which shall not constitute notice) to:</B></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>Stroock &amp; Stroock &amp; Lavan LLP<BR>
180 Maiden Lane<BR>
New York, New York  10038<BR>
Facsimile: (212) 806-6006<BR>
Attention: Jeffrey S. Lowenthal, Esq.<BR>
<BR>
and<BR>
<BR>
The Children's Place Retail Stores, Inc.<BR>
915 Secaucus Road<BR>
Secaucus, New Jersey  08540<BR>
Facsimile: (201) 808-5637<BR>
Attention: Chief Financial Officer</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>or such other address or facsimile number as may be designated
by either party hereto by written notice to the other in accordance with this
Section 11.11. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Expenses</U>. Except as otherwise provided
in this Agreement, including, without limitation, Sections 6.1, 6.8.2, 6.11.5,
6.12, 6.13, 7.1.2, 7.1.3, 7.2.3, 7.4.4, 7.4.5 and 7.12, each of DEI, Seller and
Buyer shall pay its own expenses incident to the negotiation, preparation and
performance of this Agreement and the transactions contemplated hereby
(including, without limitation, expenses incurred in connection with the
activities and negotiations contemplated by Section 6.7), including the filing
fees payable to Governmental Entities (<U>provided</U>,
<U>that</U> each of DEI and Buyer shall pay one-half of any filing fees under
the Hart-Scott-Rodino Act and the Investment Canada Act) and the fees, expenses
and disbursements of their respective accountants and counsel. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Interest</U>. All arrearages in the
payment of any sums due to either party hereto under the provisions of this
Agreement shall bear interest from the due date until paid at the lesser of (i)
the per annum amount that is equal to two percent (2%)
<U>plus</U> the Prime Rate and (ii) the highest rate of interest then allowable
pursuant to applicable Law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.14&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Waivers</U>. No release, discharge or
waiver of any provision hereof shall be enforceable against or binding upon
either party hereto unless in writing and executed by a duly authorized officer
of each of the parties hereto. Neither the failure to insist upon strict
performance of any of the agreements, terms, covenants or conditions hereof, nor
the acceptance of monies due hereunder with knowledge of a breach of this
Agreement, shall be deemed a waiver of any rights or remedies that either party
hereto may have or a waiver of any subsequent breach or default in any of such
agreements, terms, covenants and conditions. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.15&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Construction</U>. This Agreement has been
fully reviewed and negotiated by the parties hereto and their respective
counsel. Accordingly, in interpreting this Agreement, no weight shall be placed
upon which party hereto or its counsel drafted the provision being interpreted
and prior drafts of this Agreement shall be disregarded and inadmissible as
proof or indication of the intent of the parties or for any other purpose in the
event of any other controversy regarding the meaning, construction or
interpretation of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.16&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Severability</U>. If any term or provision
of this Agreement shall be found to be void or contrary to applicable Law, such
term or provision shall be deemed to be severable from the other terms and
provisions hereof, but only to the extent necessary to bring this Agreement
within the requirements of such Law, and the remainder of this Agreement shall
be given effect as if the parties had not included the severed term herein;
<U>provided</U>, that if the party that would be adversely affected by such
severance demonstrates that a material inducement to its entering into this
Agreement would be materially impaired, such party shall be entitled to seek an
adjudication that this Agreement should be terminated on that ground.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.17&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Dispute Resolution Procedures</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Management
Negotiations</U>. In the event of any controversy, dispute or claim between DEI,
Seller or any of their Affiliates, on the one hand, and Buyer or any of its
Affiliates, on the other hand, arising out of or relating to this Agreement or
any provisions hereof or the validity of this Agreement, the parties hereto
agree that, prior to submitting such controversy, dispute or claim to the
arbitration proceedings described below in this Section 11.17, it shall be
submitted to the Chief Strategic Officer of TWDC and the Chief Executive Officer
of Buyer (or, if no person holds either such title, a senior executive officer
of such entity performing a similar function), who shall negotiate in good faith
with one another for a period of not less than five (5) Business Days in an
effort to resolve such controversy, dispute or claim. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Arbitrable
Disputes</U>. All controversies, disputes and claims between DEI, Seller and/or
their Affiliates, on the one hand, and Buyer and/or its Affiliates, on the other
hand, arising out of or relating to this Agreement or any provision hereof or
the validity of this Agreement that have not been resolved through the procedure
set forth in Section 11.17.1 (collectively, <B>"Arbitrable Disputes"</B>) must
be resolved through binding arbitration administered by ADR Services (the
<B>"Arbitration Administrator"</B>) in accordance with the terms of this Section
11.17, or such other entity agreed upon by the parties hereto to administer the
arbitration of an Arbitrable Dispute. Except as otherwise set forth in this
Section 11.17, the U.S. Arbitration Act shall govern the interpretation and
enforcement of, and proceedings pursuant to, the provisions of this Section
11.17. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Applicability
of California Procedural Law</U>. Unless otherwise stipulated in writing or on
the record before the Arbitrator or the Appellate Arbitrators, in either case by
all of the parties involved in an Arbitrable Dispute (the <B>"Arbitration
Parties"</B>) or affected by the stipulation, all Arbitrable Disputes will be
governed by California procedural law, including, but not limited to, the
procedures set forth in the California Code of Civil Procedure, the California
Civil Code, the California Evidence Code, and the California Rules of Court (but
not including any local rules), except to the extent such procedures are
inconsistent with the express terms of this Section 11.17. It is the intent of
the Parties that all pleadings, discovery, motion practice, trial and appeal
(including, but not limited to, the format, scope, and substance of, and time
requirements applicable to, any filings) proceed as if the Arbitrable Dispute
had been brought in the Superior Court of the State of California, except: (i)
the Arbitrator and Appellate Arbitrators will be appointed in accordance with
Section 11.17.5; (ii) the Arbitrator will serve as the finder of fact (and the
parties waive any right to a jury); (iii) there will be no interlocutory
appellate (<U>e.g.</U>, writ) relief available; (iv) discovery will be limited
to matters that are directly relevant to the issues in the arbitration unless,
upon a finding of good cause by the Arbitrator, leave is granted to conduct
discovery that is reasonably calculated to lead to the discovery of admissible
evidence; and (v) as otherwise expressly provided for in this Section 11.17. The
parties hereto agree to be bound by the provisions of any limitation on the
period of time in which claims must be brought under applicable Law or this
Agreement, whichever expires earlier. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Arbitration
Complaints and Notices</U>. Any arbitration complaint for an Arbitrable Dispute
(a <B>"Complaint"</B>) or notice of appeal from an arbitration judgment (an
<B>"Appeal Notice"</B>) hereunder shall be served on the Arbitration Parties
pursuant to the notice provisions contained in Section 11.11 (in the case of
notice to Affiliates of either party hereto, notice to such party shall be
deemed sufficient for purposes hereof). For purposes of this Section 11.17,
service of all pleadings and other papers, and the calculation of all time
deadlines, shall be made in accordance with California procedural law (including
any modifications thereto that the Arbitrator or Appellate Arbitrators may make
in accordance with California procedural law). However, without any order by the
Arbitrator or Appellate Arbitrators, the Arbitration Parties may agree in
writing to extend or shorten any time deadline, which will be deemed effective
upon written notice by the affected Arbitration Parties to the Arbitration
Administrator and all other Arbitration Parties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Selection of
Arbitrator and Appellate Arbitrators</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Within five (5) Business Days after service of
a Complaint or an Appeal Notice, as the case may be, the Arbitration Parties
will select their jointly agreed upon arbitrator or, in the case of an appeal,
three (3) appellate arbitrators. The arbitrator shall be a former judge of the
California Superior Court (or, if an insufficient number of such former judges
are available to serve, former judges from the United States District Court for
the Central District of California) and the appellate arbitrators shall be
former judges of the California Court of Appeals (or, if an insufficient number
of such former judges are available to serve, former judges from the California
Superior Court who sat on the California Court of Appeals by designation, or, if
an insufficient number of such former judges are available to serve, former
judges from the California Superior Court who served on the bench for ten (10)
years or more).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Arbitration Parties cannot agree upon an
arbitrator or all three (3) appellate arbitrators within such time period, on
the fifth (5th) Business Day thereafter, the Arbitration Parties will
simultaneously exchange a list of five (5) proposed arbitrators or, in the case
of an appeal, ten (10) proposed appellate arbitrators (the <B>"Party
Designations"</B>). Any persons appearing on both Party Designations shall be
designated as the arbitrator or the appellate arbitrators, selected in
alphabetical order by last name. If for any reason a person so selected cannot
or will not serve as arbitrator or appellate arbitrator, the next person common
to both Party Designations in alphabetical order by last name shall be
designated as the arbitrator or appellate arbitrator and so on until there are
no more persons common to both Party Designations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the arbitrator or any appellate arbitrator
remains to be selected following the procedures set forth in the preceding
subparagraph (b), each Arbitration Party shall have the right to strike up to
two names appearing on the other's Party Designation and, on the fifth (5th)
Business Day following exchange of the Party Designations, shall notify the
other Arbitration Party, in writing, of the names, if any, so stricken (the
<B>"Strike Notices"</B>).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each party shall then rank each person
remaining on both Party Designations in numerical order of preference (1 being
the most preferred, 2 being next, and so on), and, on the second (2nd) Business
Day following service of the Strike Notices, the Arbitration Parties shall
simultaneously exchange their respective rankings (the <B>"Priority
Designations"</B>). The person with the lowest combined total from the Priority
Designations shall be designated as the arbitrator or, in the case of an appeal,
the three (3) persons with the lowest combined totals from the Priority
Designations shall be designated as the appellate arbitrators. Any ties will be
broken by choosing the person first in alphabetical order by last name. If, for
any reason, a person so selected cannot or will not serve as arbitrator or
appellate arbitrator, the next person in order using the methodology prescribed
in this Section 11.17.5 shall be designated as arbitrator or appellate
arbitrator and so on until no more names appear on the Arbitration Parties'
Priority Designations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If there are no more names from which to select
an arbitrator or appellate arbitrator on the parties' Priority Designations or
if any party fails to comply with the selection procedures herein, the
Arbitration Administrator shall provide a list of five (5) persons or, in the
case of an appeal, ten (10) persons, all of whom shall be former judges
complying with the requirements of Section 11.17.5(a). Each Arbitration Party
may strike up to two (2) names from this list, and of those who are left the
person whose name is first in alphabetical order by last name shall serve as
arbitrator or, in the case of an appeal, the first three (3) persons in
alphabetical order by last name shall serve as appellate arbitrators. The person
selected pursuant to this Section 11.17.5 to serve as arbitrator is referred to
herein as the <B>"Arbitrator"</B> and the persons selected pursuant to this
Section 11.17.5 to serve as appellate arbitrators are referred to herein as the
<B>"Appellate Arbitrators."</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Within two (2) Business Days after selection of
the Arbitrator or the Appellate Arbitrators, the Arbitration Parties will inform
the Arbitration Administrator, in writing and on a confidential basis, of the
name and contact information of the Arbitrator or the Appellate Arbitrators.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Arbitrator or any Appellate Arbitrator
becomes unable to serve for any reason, the next arbitrator or appellate
arbitrator who would have been chosen pursuant to the procedure set forth in
this Section 11.17.5 shall be selected or, if there is no such arbitrator or
appellate arbitrator available as a result of such procedure, the Arbitration
Parties shall repeat the procedure set forth in this Section 11.17.5 to select
another arbitrator or appellate arbitrator.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Arbitrator
Neutrality</U>. In order to serve as an Arbitrator or Appellate Arbitrator for a
Arbitrable Dispute, the appointed Arbitrator or Appellate Arbitrator must be
neutral with respect to the matters being arbitrated, the Arbitration Parties,
and their counsel, consistent with California Code of Civil Procedure Section
170.1. The Arbitration Administrator is responsible for ensuring that
appropriate disclosures are made by the Arbitrator and Appellate Arbitrators to
achieve and maintain such neutrality. If there is a dispute over the neutrality
of an appointed Arbitrator or Appellate Arbitrator, the dispute shall be
resolved by the Arbitration Administrator. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Emergency
Relief</U>. If an Arbitration Party is seeking emergency relief prior to the
appointment of the Arbitrator, the parties hereto agree that the AAA Optional
Rules for Emergency Measures of Protection shall apply, but that the Arbitration
Administrator shall appoint an arbitrator to preside over the emergency
proceedings (the <B>"Emergency Arbitrator"</B>). The Emergency Arbitrator shall
have jurisdiction: (i) only until the selection of the Arbitrator in accordance
with Section 11.17.5; and (ii) only over such matters requiring emergency
relief. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Arbitration
Hearing/Arbitrator's Rulings, Statement of Decision and Judgment</U>. Unless
otherwise agreed among all Arbitration Parties and the Arbitrator, there shall
be a record of all proceedings conducted in conjunction with any arbitration.
The Arbitrator will be vested with the full powers of a judge of the Superior
Court of the State of California and will have the right to award or include in
the Arbitrator's award any relief that the Arbitrator deems proper in the
circumstances, subject to the limitation on liability set forth in Section
11.19, including, without limitation, money damages (with interest on unpaid
amounts from the date due) and specific performance, a temporary restraining
order, a preliminary and/or permanent injunction or other equitable relief,
<U>provided</U>, that the Arbitrator will not have the authority to declare any
mark generic or otherwise invalid except to the extent necessary to rule on any
claim of intellectual property infringement between the parties hereto (in which
event such ruling shall be binding as between the parties hereto but such ruling
shall not be binding as between either party hereto and any other Person). The
Arbitrator shall issue rulings, a statement of decision, and a judgment as if
the Arbitrator were a judge of the Superior Court of the State of California.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Appeal</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Within twenty (20) Business Days of receipt of
any judgment, any Arbitration Party may notify the Arbitration Administrator of
an intention to appeal to an arbitral tribunal. To appeal the judgment of an
Arbitrator, an Arbitration Party must follow all of the prerequisites for
appealing a judgment of the Superior Court of the State of California. All
prerequisites ordinarily directed to the clerk of such court shall be directed
to the Arbitration Administrator.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All appeals will be made to three (3) Appellate
Arbitrators appointed (or replaced, if necessary) pursuant to Section 11.17.5.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Appellate Arbitrators will conduct a
hearing, review the judgment of the Arbitrator, and issue an appellate decision
applying the same standards of review (and all of the same presumptions) as if
the Appellate Arbitrators were judges of the California Court of Appeal
reviewing a judgment of the Superior Court. The Appellate Arbitrators will be
vested with the same powers as a California Court of Appeal (including the power
to remand a matter to an Arbitrator, or a replacement Arbitrator, in accordance
with the rights of a party following an appeal).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Appellate Arbitrators' decision will be
final and binding (unless remanded to the Arbitrator, or replacement Arbitrator,
pursuant to subparagraph (c) of this Section 11.17.9), as to all matters of
substance and procedure.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Jurisdiction/Venue/Enforcement of Award</U>. The parties hereto consent and
submit to the exclusive personal jurisdiction and venue of the Superior Court
and the United States District Court, located in the County of Los Angeles,
State of California, to compel arbitration of an Arbitrable Dispute in
accordance with this Section 11.17, to enforce any arbitration award granted
pursuant to this Section 11.17, including, without limitation, any award
granting equitable relief, and to otherwise enforce this Section 11.17 and carry
out the intentions of the parties to resolve all Arbitrable Disputes through
arbitration. All arbitrations under this Section 11.17 shall be conducted in Los
Angeles, California. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Discovery</U>.
Subject to and without limiting Section 11.17.3, (i) each Arbitration Party
will, upon the written request of the other Arbitration Party, promptly provide
the other with copies of documents relevant to the issues raised by any claim or
counterclaim; (ii) at the request of an Arbitration Party, the Arbitrator shall
have the discretion to order examination by deposition of witnesses to the
extent the Arbitrator deems such additional discovery relevant and appropriate
(<U>provided</U>, that each Arbitration Party shall be entitled, in its
respective sole discretion, to conduct depositions of up to five (5) fact
witnesses and up to two (2) expert witnesses; (iii) all objections are reserved
for the arbitration hearing except for objections based on privilege and
proprietary or confidential information; (iv) any dispute regarding discovery,
or the relevant scope thereof, shall be determined by the Arbitrator, which
determination shall be conclusive; and (v) all discovery shall be completed
within the time period established by the Arbitrator. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <U>Res
Judicata, Collateral Estoppel and Law of the Case</U>. A decision of the
Arbitrator and Appellate Arbitrators shall have the same force and effect with
respect to collateral estoppel, res judicata and law of the case that such
decision would have been entitled to if decided in a court of law, but in no
event shall such award be used by or against an Arbitration Party in a
Non-Signatory Dispute. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Confidential
Proceedings</U>. All arbitration proceedings, including, without limitation, any
appellate proceedings, will be closed to the public and confidential, and all
records relating thereto will be maintained by the Arbitration Parties as
Confidential Information in accordance with Section 11.9 and will be permanently
sealed, except as necessary to obtain court confirmation of the judgment of the
Arbitrator or the decision of the Appellate Arbitrators, as applicable, and
except as necessary to give effect to res judicata and collateral estoppel
(<U>e.g.</U>, in a dispute between the Arbitration Parties that is not an
Arbitrable Dispute), in which case all filings with any court shall be sealed to
the extent permitted by the court and applicable Law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.14&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Arbitrator Fees and Arbitration Costs</U>. The Arbitrators or Appellate
Arbitrators, as the case may be, will have no authority to award any damages
that are inconsistent with Section 11.19. The Arbitration Parties will share
equally the fees of the Arbitrator and Appellate Arbitrators and administrative
costs of the arbitration (including reporter's fees, but not including filing
fees), with each side obligated for its pro rata share of the total (subject to
reallocation as provided below). The determination of whether there are more
than two sides will be made by the Arbitration Administrator, which
determination may be reviewed by the Arbitrator upon the request of any
Arbitration Party. The fees of the Arbitrator and Appellate Arbitrators and
administrative costs of the arbitration paid by the prevailing Arbitration Party
(as determined at the conclusion of all proceedings, including any appeal,
remand or subsequent appeals) will be awarded as costs to the prevailing
Arbitration Party. The entitlement of an Arbitration Party to attorneys' fees
and other additional costs shall be determined in accordance with any agreements
between the Arbitration Parties governing such matters and California procedural
law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.15&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Non-Signatory Legal Actions</U>. As used in this Section 11.17, "Arbitrable
Dispute" does not include compulsory or permissive cross-claims between the
parties that arise in a legal action brought by or against a non-signatory
hereto (<B>"Non-Signatory Dispute"</B>). However, a party that has the right to
assert a permissive cross-claim against another party in a Non-Signatory Dispute
may choose to treat that claim as an Arbitrable Dispute and assert it in
accordance with the terms of this Section 11.17. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.16&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Expedited
Procedures</U>. Consistent with the expedited nature of arbitration, it is the
mutual intent of the parties that under all circumstances any controversies,
disputes or claims between them be resolved expeditiously, and either
Arbitration Party may, upon application to the Arbitrator for good cause shown,
move the Arbitrator for extraordinary expedition (including, without limitation,
the fixing of a discovery cut-off date and dates for the commencement and
completion of hearings). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.17&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <U>No
Declaratory Relief</U>. Notwithstanding anything contained herein to the
contrary, Buyer shall not be entitled to submit any action for declaratory
relief (or any comparable action for a determination that Buyer has not
violated, defaulted under or otherwise breached this Agreement or any other
related agreement entered into in connection herewith) to the arbitration
proceedings contemplated by this Section 11.17 or in court or through any other
dispute resolution mechanism other than as contemplated by Section 11.17.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.18&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Confidentiality Agreement</U>. Notwithstanding anything to the contrary
contained herein, the Confidentiality Agreement shall not be governed by the
provisions of this Section 11.17.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17.19
<U>Survivability</U>. The provisions of this Section 11.17 shall survive the
expiration or earlier termination of this Agreement indefinitely. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;11.18&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Governing Law; Remedies</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.18.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except to the
extent that certain matters may be governed by federal law, this Agreement shall
be deemed to have been entered into in the State of California and shall be
interpreted and construed in accordance with the laws of the State of California
applicable to agreements executed and to be performed therein by each party
hereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.18.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each party
hereby acknowledges and agrees that, in the event of any breach or prospective
breach of this Agreement, the remedies of each party shall include, without
limitation, money damages (if and to the extent available), any form of
equitable relief, including, without limitation, any temporary restraining
order, preliminary injunction, permanent injunction, specific performance or any
other form of relief in equity (if such relief is available and such party is
able to satisfy the requirements necessary to obtain such relief), and any other
right or remedy available to such party as a result of such breach under this
Agreement, at law, in equity or otherwise. The parties acknowledge and agree
that money damages may not be an adequate remedy for a breach of this Agreement
and that a non-breaching party may, in its sole discretion, apply for a
temporary restraining order, a preliminary injunction, a permanent injunction,
specific performance or other form of equitable relief (without the posting of
any bond or other security) as may be just and proper in order to enforce the
applicable provision of this Agreement or prevent any violation thereof. Any
such equitable relief shall not be exclusive and any party seeking such relief
shall also be entitled to seek and enforce any other right or remedy available
to it, including money damages. The parties hereby acknowledge and agree that
all remedies sought under this Agreement, including without limitation actions
for equitable relief hereunder, shall be resolved through the dispute resolution
procedures set forth in Section 11.17. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.18.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The
provisions of this Section 11.18 shall survive the expiration or earlier
termination of this Agreement indefinitely. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.19&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Limitation of Liability</U>.
Notwithstanding anything contained herein to the contrary, except for any Loss
paid to third parties for which either party hereto is obligated to indemnify
the other party pursuant to Article X, neither party shall be liable under this
Agreement to the other party for any punitive, exemplary, consequential,
incidental, indirect or special damages (including loss of profits) based upon
breach of warranty, breach of contract, negligence, strict liability and tort,
or any other legal theory. With respect to any Loss paid to third parties for
which either party hereto is obligated to indemnify the other party pursuant to
Article X, no such limitation on damages shall apply. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.20&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Joint and Several Liability of USA
Purchaser and Canadian Purchaser</U>. Notwithstanding anything to the contrary
contained herein, USA Purchaser and Canadian Purchaser shall be jointly and
severally liable for all of the liabilities, duties and obligations of USA
Purchaser, Canadian Purchaser and/or Buyer hereunder without regard to (i) the
party or parties to whom this Agreement allocates any such liability, duty or
obligation, or (ii) the party or parties from whose action, omission, breach or
violation any such liability, duty or obligation arises or on whose action,
omission, breach or violation any such liability, duty or obligation is based.
</FONT></P>

<P ALIGN=CENTER># # #<BR>
<BR>
[Signature Page Follows]<BR>
<BR>
# # #<BR>
<BR>
[Signature Page to Acquisition Agreement]</P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed by its duly authorized officers all as of the day and year first above
written. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT><B>"DEI"</B><BR>
<BR>
DISNEY ENTERPRISES, INC.<BR>
<BR>
By: <U>/s/ James M. Kapenstein&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: James M. Kapenstein<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President-Counsel</TD>
<TD WIDTH=50%><B>"USA PURCHASER"</B><BR>
<BR>
HOOP HOLDINGS, LLC<BR>
<BR>
By: <U>/s/ Ezra Dabah&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Ezra Dabah<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Chief Executive Officer</TD>
</TR>
</TABLE>
<BR>

<PAGE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT><B>"SELLER"</B><BR>
<BR>
DISNEY CREDIT CARD SERVICES, INC. <BR>
<BR>
By: <U>/s/ Aldo Manzini&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Aldo Manzini<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Senior Vice President</TD>
<TD WIDTH=50%><B>"CANADIAN PURCHASER"</B><BR>
<BR>
HOOP CANADA HOLDINGS, INC.<BR>
<BR>
By: <U>/s/ Ezra Dabah&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Ezra Dabah<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Chief Executive Officer</TD>
</TR>
</TABLE>
<BR>

<PAGE>


<P ALIGN=CENTER><FONT SIZE=3>GUARANTEE BY TCP</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Children's Place Retail Stores, Inc., a Delaware corporation
(<B>"Guarantor"</B>), acknowledges that it owns a material interest, directly or
indirectly, in USA Purchaser and Canadian Purchaser and therefore stands to
benefit substantially from the transactions contemplated by this Agreement.
Accordingly, as a material inducement to DEI and Seller to enter into this
Agreement, which DEI and Seller would not have done in the absence of this
guarantee, Guarantor hereby absolutely and unconditionally guarantees to DEI and
Seller the full and timely performance of all of the obligations of Buyer under
the terms and conditions of this Agreement and the Deferred Lease Assignment and
Assumption Agreement, including any amendments, modifications, extensions or
compromises thereof, required to be performed by Buyer (collectively, the
<B>"Obligations"</B>); <U>provided</U>, that (a) the term
"Obligations" as used herein shall not include obligations under any
Related Agreements and (b) in the event that Buyer breaches this Agreement by
failing to close the transactions contemplated by this Agreement notwithstanding
the fact that all of the conditions to the obligations of Buyer to effect the
Closing, as set forth in Sections 8.1 and 8.2, have been fulfilled, satisfied or
waived, the liability of Guarantor under this guarantee arising out of or in
connection with such breach (and only such breach) shall not exceed One Hundred
Twenty Five Million Dollars ($125,000,000). Guarantor acknowledges and agrees
that: (i)&#160;this is a guarantee of payment and performance and not of
collectibility only; (ii)&#160;Guarantor's responsibility for the
Obligations is in no way conditioned upon any requirement that DEI or Seller
first attempt to collect any of the Obligations from Buyer and, upon demand from
DEI or Seller, the obligations of Guarantor shall become immediately due and
payable, without demand, presentment, protest, notice of acceptance, notice of
any obligations incurred, or any other notices of any kind or nature, each of
which is expressly waived by Guarantor; (iii)&#160;this guarantee shall be
binding upon Guarantor notwithstanding the addition, substitution or release of
any Person primarily or secondarily liable for any Obligation, the bankruptcy,
insolvency or other inability to pay or perform of Buyer, or any other act or
omission that might in any manner or to any extent vary the risk of Guarantor or
otherwise operate as a release or discharge of Guarantor; (iv)&#160;Guarantor
shall not, until the final payment and performance in full of all Obligations,
exercise any rights against Buyer arising as a result of payment by Guarantor
hereunder, by way of subrogation, reimbursement, restitution, setoff,
recoupment, counterclaim or otherwise; (v)&#160;the payment of any amount due to
Guarantor by Buyer is subordinated to the prior payment in full of all of the
Obligations, and any amounts received by Guarantor in respect thereof while any
Obligations are still outstanding shall be received by Guarantor as trustee for
DEI and Seller and shall be promptly paid over to DEI and Seller; and
(vi)&#160;upon demand by DEI or Seller, Guarantor shall pay all documented
out-of-pocket costs and expenses (including court costs and reasonable legal
expenses) reasonably incurred by DEI and/or Seller in connection with the
enforcement of this guarantee. Guarantor represents and warrants to DEI and
Seller that this guarantee has been duly and validly executed by Guarantor and
constitutes the legally valid and binding obligation of Guarantor, enforceable
against Guarantor in accordance with its terms. Capitalized terms used herein
without definition have the meanings assigned thereto in the Agreement. The
terms of Article XI of the Agreement, including, without limitation, Section
11.19, are hereby incorporated into this guarantee as if set forth in full
herein, with the exception that references to "Buyer" therein shall be
deemed to be references to "Guarantor" for purposes of this guarantee. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT></TD>
<TD WIDTH=50%><B>"Guarantor"</B><BR>
The Children's Place Retail Stores, Inc.,<BR>
a Delaware corporation<BR>
<BR>
<BR>
By: <U>/s/ Ezra Dabah&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Ezra Dabah<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Chief Executive Officer</TD>
</TR>
</TABLE>
<BR>


<PAGE>

<P ALIGN=CENTER><U>TABLE OF CONTENTS</U></P>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><BR>
<BR>
<B>ARTICLE I</B></TD>
<TD WIDTH=65%><BR>
<BR>
DEFINITIONS</TD>
<TD WIDTH=20% ALIGN=LEFT><U>Page</U><BR>
<BR>
1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>1.1</TD>
<TD WIDTH=65%>Definitions</TD>
<TD WIDTH=20% ALIGN=LEFT>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>1.2</TD>
<TD WIDTH=65%>Interpretation</TD>
<TD WIDTH=20% ALIGN=LEFT>39</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE II</B></TD>
<TD WIDTH=65%>MEMBERSHIP UNIT AND SHARE ACQUISITION</TD>
<TD WIDTH=20% ALIGN=LEFT>39</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.1</TD>
<TD WIDTH=65%>Pre-Closing Transactions</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>39</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.1.1</TD>
<TD WIDTH=55%>Distribution to Member</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>39</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.1.2</TD>
<TD WIDTH=55%>Transfer by TDS Canada</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>39</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.1.3</TD>
<TD WIDTH=55%>Transfer of Intellectual Property and Technology</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>40</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.1.4</TD>
<TD WIDTH=55%>Intercompany Agreements and Arrangements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>40</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.2</TD>
<TD WIDTH=65%>Acquisition of the Membership Units and the Shares</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>41</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.3</TD>
<TD WIDTH=65%>Working Capital Adjustments </TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>41</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.3.1</TD>
<TD WIDTH=55%>Closing Date Adjustment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>41</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.3.2</TD>
<TD WIDTH=55%>Post-Closing Adjustment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>42</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.4</TD>
<TD WIDTH=65%>Allocation of the Tax Purchase Price to Assets</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>45</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.5</TD>
<TD WIDTH=65%>338 Election</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>46</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>2.6</TD>
<TD WIDTH=65%>Post-Closing Transactions</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>46</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE III</B></TD>
<TD WIDTH=65%>CLOSING</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>47</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>3.1</TD>
<TD WIDTH=65%>Closing; No Change in Terms</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>47</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>3.1.1</TD>
<TD WIDTH=55%>Closing</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>47</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>3.1.2</TD>
<TD WIDTH=55%>No Change in Terms</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>48</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>3.2</TD>
<TD WIDTH=65%>Closing Deliveries by DEI and Seller</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>48</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>3.3</TD>
<TD WIDTH=65%>Closing Deliveries by Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>49</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>3.4</TD>
<TD WIDTH=65%>Resignation of Officers and Directors</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>49</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>3.5</TD>
<TD WIDTH=65%>Section 116 Requirements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>49</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE IV</B></TD>
<TD WIDTH=65%>REPRESENTATIONS AND WARRANTIES OF DEI AND SELLER</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>52</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.1</TD>
<TD WIDTH=65%>Organization; Capitalization</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>52</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.1.1</TD>
<TD WIDTH=55%>Incorporation and Authority of DEI</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>52</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.1.2</TD>
<TD WIDTH=55%>Incorporation and Authority of Seller</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>52</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.1.3</TD>
<TD WIDTH=55%>Incorporation and Authority of the Company; Governing Documents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>52</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.1.4</TD>
<TD WIDTH=55%>Capitalization of TDS USA</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>53</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.1.5</TD>
<TD WIDTH=55%>Capitalization of TDS Canada</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>53</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.1.6</TD>
<TD WIDTH=55%>Tax Classification of TDS USA</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>53</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.1.7</TD>
<TD WIDTH=55%>Subsidiaries</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>53</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.2</TD>
<TD WIDTH=65%>Financial Statements; Indebtedness; Liabilities or Contingencies</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>53</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.2.1</TD>
<TD WIDTH=55%>Financial Statements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>53</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.2.2</TD>
<TD WIDTH=55%>Indebtedness; Liabilities or Contingencies</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.3</TD>
<TD WIDTH=65%>Accounting Records and Accounting Controls; Minute Books</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.4</TD>
<TD WIDTH=65%>Tax and Other Returns and Reports</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.5</TD>
<TD WIDTH=65%>Contracts</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>55</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.5.1</TD>
<TD WIDTH=55%>Contracts; No Breach or Default</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>55</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.5.2</TD>
<TD WIDTH=55%>No Termination or Modification</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>55</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.5.3</TD>
<TD WIDTH=55%>Authorization and Enforceability</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>56</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.6</TD>
<TD WIDTH=65%>Leases and Personal Property</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>56</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.6.1</TD>
<TD WIDTH=55%>Leases</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>56</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.6.2</TD>
<TD WIDTH=55%>Personal Property</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>57</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.7</TD>
<TD WIDTH=65%>Non-IT Intellectual Property and Information Technology</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>57</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.7.1</TD>
<TD WIDTH=55%>Non-IT Intellectual Property; Disney Information Technology</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>57</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.7.2</TD>
<TD WIDTH=55%>Company Information Technology</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>58</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.8</TD>
<TD WIDTH=65%>Authorization; No Conflicts</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>58</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.8.1</TD>
<TD WIDTH=55%>Authorization</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>58</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.8.2</TD>
<TD WIDTH=55%>No Conflicts</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>58</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.9</TD>
<TD WIDTH=65%>Legal Proceedings</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>59</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.10</TD>
<TD WIDTH=65%>Permits</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>59</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.11</TD>
<TD WIDTH=65%>Compliance with Law</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>59</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.12</TD>
<TD WIDTH=65%>Employee Benefit Plans</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>59</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.12.1</TD>
<TD WIDTH=55%>Disney Plans</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>59</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.12.2</TD>
<TD WIDTH=55%>Employee Benefit Plan Information</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>59</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.12.3</TD>
<TD WIDTH=55%>Company Plans</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.12.4</TD>
<TD WIDTH=55%>No HIPAA Violations</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.12.5</TD>
<TD WIDTH=55%>Parachute Payments</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.12.6</TD>
<TD WIDTH=55%>Prohibited Transactions</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.13</TD>
<TD WIDTH=65%>Environmental Compliance</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.14</TD>
<TD WIDTH=65%>No Brokers or Finders</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.15</TD>
<TD WIDTH=65%>Retained Assets</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.16</TD>
<TD WIDTH=65%>Absence of Certain Changes and Events</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.17</TD>
<TD WIDTH=65%>Title to Assets</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>62</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.18</TD>
<TD WIDTH=65%>Labor Matters</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>62</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.19</TD>
<TD WIDTH=65%>No Other Agreements to Sell</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>62</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.20</TD>
<TD WIDTH=65%>Payments</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>62</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.21</TD>
<TD WIDTH=65%>Bank Accounts</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>63</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>4.22</TD>
<TD WIDTH=65%>DWS</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE V</B></TD>
<TD WIDTH=65%>REPRESENTATIONS AND WARRANTIES OF BUYER</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>63</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.1</TD>
<TD WIDTH=65%>Organization; Capitalization</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>63</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.1.1</TD>
<TD WIDTH=55%>Organization and Authority of USA Purchaser</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>63</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.1.2</TD>
<TD WIDTH=55%>Incorporation and Authority of New TDS LLC and New TDS Canada</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>63</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.1.3</TD>
<TD WIDTH=55%>Incorporation and Authority of Canadian Purchaser</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>64</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.1.4</TD>
<TD WIDTH=55%>Incorporation and Authority of TCP</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>64</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.1.5</TD>
<TD WIDTH=55%>Capitalization; Outstanding Securities</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>64</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.1.6</TD>
<TD WIDTH=55%>Buyer's Governing Documents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>65</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.2</TD>
<TD WIDTH=65%>Authorization; No Conflicts</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>65</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.2.1</TD>
<TD WIDTH=55%>Authorization</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>65</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.2.2</TD>
<TD WIDTH=55%>No Conflicts</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>66</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.3</TD>
<TD WIDTH=65%>Legal Proceedings</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>67</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.4</TD>
<TD WIDTH=65%>Buyer's Financing and Liquidity</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>67</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.5</TD>
<TD WIDTH=65%>No Brokers or Finders</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>67</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.6</TD>
<TD WIDTH=65%>Investment Representations</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>68</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>5.7</TD>
<TD WIDTH=65%>Non-Canadian; Non-Resident of Canada</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>68</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE VI</B></TD>
<TD WIDTH=65%>COVENANTS WITH RESPECT TO CONDUCT OF DEI, SELLER, COMPANY AND BUYER PRIOR TO CLOSING</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>68</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.1</TD>
<TD WIDTH=65%>Access; Books and Records</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>68</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.2</TD>
<TD WIDTH=65%>Financial Statements; Updates to TDS Schedules; Post-Closing Merchandise Plan</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>69</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.2.1</TD>
<TD WIDTH=55%>Financial Statements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>69</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.2.2</TD>
<TD WIDTH=55%>Updates to TDS Schedules</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>70</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.2.3</TD>
<TD WIDTH=55%>Post-Closing Merchandise Plan</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>70</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.3</TD>
<TD WIDTH=65%>Conduct of Business</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>74</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.4</TD>
<TD WIDTH=65%>Capitalization, Financing and Liquidity of Buyer and TCP</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>77</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.4.1</TD>
<TD WIDTH=55%>Capitalization and Financing</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>77</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.4.2</TD>
<TD WIDTH=55%>Liquidity Plan</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>77</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.4.3</TD>
<TD WIDTH=55%>Buyer's Governing Documents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>78</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.5</TD>
<TD WIDTH=65%>Notification of Certain Matters</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>78</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.6</TD>
<TD WIDTH=65%>Permits and Consents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>78</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.6.1</TD>
<TD WIDTH=55%>Permits</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>78</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.6.2</TD>
<TD WIDTH=55%>Consents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>78</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.6.3</TD>
<TD WIDTH=55%>Effect of Failure to Obtain Permits or Consents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>79</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.7</TD>
<TD WIDTH=65%>Lease Matters</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>79</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.7.1</TD>
<TD WIDTH=55%>Landlord Consents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>79</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.7.2</TD>
<TD WIDTH=55%>Changes to Acquired Stores Schedule and Disney Retained <BR>
Stores Schedule</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>81</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.7.3</TD>
<TD WIDTH=55%>Subsequent Closing for Deferred Leases</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>84</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.7.4</TD>
<TD WIDTH=55%>Survival of Section 6.7</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>85</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.8</TD>
<TD WIDTH=65%>Regulatory Filings and Deliveries</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>85</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.8.1</TD>
<TD WIDTH=55%>Hart-Scott-Rodino Act</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>86</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.8.2</TD>
<TD WIDTH=55%>Investment Canada Act</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>86</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.8.3</TD>
<TD WIDTH=55%>Competition Act</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>86</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.8.4</TD>
<TD WIDTH=55%>Franchise Information</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>86</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.9</TD>
<TD WIDTH=65%>Retained Asset Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>86</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.9.1</TD>
<TD WIDTH=55%>General</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>86</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.9.2</TD>
<TD WIDTH=55%>Pre-Closing Obligations Regarding Certain Retained Asset Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>87</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.9.3</TD>
<TD WIDTH=55%>Other Retained Asset Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>87</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.9.4</TD>
<TD WIDTH=55%>Effect of Failure to Assign or Amend Retained Asset Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>88</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.10</TD>
<TD WIDTH=65%>Participation Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>88</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.10.1</TD>
<TD WIDTH=55%>General</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>88</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.10.2</TD>
<TD WIDTH=55%>Negotiations Regarding the Amex Agreement, the Canada Mastercard
Agreement and Other Credit and Charge Card Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>88</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.10.3</TD>
<TD WIDTH=55%>ValueLink Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>89</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.10.4</TD>
<TD WIDTH=55%>No Rights Under Participation Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>89</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.10.5</TD>
<TD WIDTH=55%>Effect of Failure to Assign or Amend Participation Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>89</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11</TD>
<TD WIDTH=65%>Certain Transactions and Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>90</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.1</TD>
<TD WIDTH=55%>Company Bank Accounts; Powers of Attorney</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>90</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.2</TD>
<TD WIDTH=55%>Letters of Credit Relating to Inventory Orders</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>91</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.3</TD>
<TD WIDTH=55%>Disney Umbrella Freight Services</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>91</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.4</TD>
<TD WIDTH=55%>** (<I>This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission</I>)</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>91</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.5</TD>
<TD WIDTH=55%>Certain Pre-Closing Expenses</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>92</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.6</TD>
<TD WIDTH=55%>Company Credit Facility; Supporting LCs</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>92</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.7</TD>
<TD WIDTH=55%>Wells Fargo Credit Facility</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>95</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.8</TD>
<TD WIDTH=55%>Distribution Center Observers</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>96</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.9</TD>
<TD WIDTH=55%>SunTrust Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>97</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.10</TD>
<TD WIDTH=55%>Company Plans</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>97</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.11</TD>
<TD WIDTH=55%>Certain Transactions by TCP</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>97</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.11.12</TD>
<TD WIDTH=55%>Certain Employee Cards and Other Property</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>98</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.12</TD>
<TD WIDTH=65%>Solvency Opinion</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>98</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.13</TD>
<TD WIDTH=65%>Company Audit</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>98</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.14</TD>
<TD WIDTH=65%>No Competing Offers</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>99</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.15</TD>
<TD WIDTH=65%>Transitional Services Agreements; Bifurcation of License and Conduct of Business
Agreement; Operating Manual; Additional Documents to be Prepared Prior to
Closing</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>99</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.15.1</TD>
<TD WIDTH=55%>Transitional Services</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>100</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.15.2</TD>
<TD WIDTH=55%>Bifurcation of License and Conduct of Business Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>100</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.15.3</TD>
<TD WIDTH=55%>Operating Manual</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>101</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.15.4</TD>
<TD WIDTH=55%>Additional Documents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>101</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.16</TD>
<TD WIDTH=65%>Execution and Delivery of Documents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>101</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.17</TD>
<TD WIDTH=65%>Independent Directors</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>101</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>6.18</TD>
<TD WIDTH=65%>Initial Equity Investment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>102</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE VII</B></TD>
<TD WIDTH=65%>CONTINUING COVENANTS</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>102</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.1</TD>
<TD WIDTH=65%>Tax Matters</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>102</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.1.1</TD>
<TD WIDTH=55%>Tax Returns</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>102</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.1.2</TD>
<TD WIDTH=55%>Cooperation on Tax Matters</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>103</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.1.3</TD>
<TD WIDTH=55%>Transaction Taxes</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>103</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.1.4</TD>
<TD WIDTH=55%>Tax Refunds</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>104</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.2</TD>
<TD WIDTH=65%>Other Cooperation</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>104</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.2.1</TD>
<TD WIDTH=55%>Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>104</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.2.2</TD>
<TD WIDTH=55%>Seller and DEI</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>104</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.2.3</TD>
<TD WIDTH=55%>Records Relating to Transition Services</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>105</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.3</TD>
<TD WIDTH=65%>Effect of Due Diligence and Related Matters</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>106</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4</TD>
<TD WIDTH=65%>Continuing Employee Matters</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>106</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4.1</TD>
<TD WIDTH=55%>Employees of Business</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>106</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4.2</TD>
<TD WIDTH=55%>Obligations to Continuing Employees; Cessation of Benefits Under Disney
Plans</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>107</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4.3</TD>
<TD WIDTH=55%>COBRA Continuation Coverage</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>107</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4.4</TD>
<TD WIDTH=55%>Retention Program for Continuing Employees</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>107</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4.5</TD>
<TD WIDTH=55%>Retention Program for Transition Employees</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>107</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4.6</TD>
<TD WIDTH=55%>Closing Date Payroll</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>108</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4.7</TD>
<TD WIDTH=55%>Employee Indemnification Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>108</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.4.8</TD>
<TD WIDTH=55%>No Third Party Beneficiaries</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>109</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.5</TD>
<TD WIDTH=65%>Post-Closing Obligations Regarding Retained Asset Agreements and
Participation Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>109</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.6</TD>
<TD WIDTH=65%>Insurance</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>110</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.7</TD>
<TD WIDTH=65%>Corporate Headquarters</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>110</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.8</TD>
<TD WIDTH=65%>Non-IT Intellectual Property; Disney Information Technology</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>110</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.9</TD>
<TD WIDTH=65%>Transitional Services</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>111</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.10</TD>
<TD WIDTH=65%>Management and Operation of Disney Retained Stores</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>111</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.10.1</TD>
<TD WIDTH=55%>Management by Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>111</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.10.2</TD>
<TD WIDTH=55%>Closing of Deferred Stores and Disney Retained Stores</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>111</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.11</TD>
<TD WIDTH=65%>Actions by Canadian Competition Bureau</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>111</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.12</TD>
<TD WIDTH=65%>Post-Closing Audit-Related Information</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>112</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>7.13</TD>
<TD WIDTH=65%>Initial Equity Capital Investment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>113</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE VIII</B></TD>
<TD WIDTH=65%>CONDITIONS OF ACQUISITION</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.1</TD>
<TD WIDTH=65%>General Conditions</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.1.1</TD>
<TD WIDTH=55%>Legal Proceedings</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.1.2</TD>
<TD WIDTH=55%>Permits</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.2</TD>
<TD WIDTH=65%>Conditions to Obligations of Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.2.1</TD>
<TD WIDTH=55%>Representations, Warranties and Covenants of DEI and Seller</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.2.2</TD>
<TD WIDTH=55%>Minimum Number of Core Store Consents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>114</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.2.3</TD>
<TD WIDTH=55%>Related Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>114</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.2.4</TD>
<TD WIDTH=55%>TDS Audited Financial Statements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>114</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.2.5</TD>
<TD WIDTH=55%>Legal Opinion of Counsel for DEI and Seller</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>114</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.2.6</TD>
<TD WIDTH=55%>Good Standing Certificates</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>114</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3</TD>
<TD WIDTH=65%>Conditions to Obligations of DEI and Seller</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>114</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.1</TD>
<TD WIDTH=55%>Representations, Warranties and Covenants of Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>114</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.2</TD>
<TD WIDTH=55%>Minimum Number of Core Store Consents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>115</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.3</TD>
<TD WIDTH=55%>Approval of Buyer's Capitalization, Financing, Liquidity and
Governing Documents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>115</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.4</TD>
<TD WIDTH=55%>Retained Asset Agreements</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>115</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.5</TD>
<TD WIDTH=55%>Related Agreements and Other Documents</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>115</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.6</TD>
<TD WIDTH=55%>Independent Directors</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>115</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.7</TD>
<TD WIDTH=55%>Initial Equity Capital Investment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>116</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.8</TD>
<TD WIDTH=55%>Solvency Opinion</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>116</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.9</TD>
<TD WIDTH=55%>WARN Act Compliance</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>116</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.10</TD>
<TD WIDTH=55%>Capitalization of TCP</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.11</TD>
<TD WIDTH=55%>Virginia Franchise Qualification</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.12</TD>
<TD WIDTH=55%>Legal Opinion of Buyer's Counsel</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>8.3.13</TD>
<TD WIDTH=55%>Good Standing Certificates</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE IX</B></TD>
<TD WIDTH=65%>TERMINATION</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>9.1</TD>
<TD WIDTH=65%>Termination of Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>9.1.1</TD>
<TD WIDTH=55%>Mutual Consent</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>9.1.2</TD>
<TD WIDTH=55%>Conditions to Buyer's Performance Not Met</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>9.1.3</TD>
<TD WIDTH=55%>Conditions to DEI's and Seller's Performance Not Met</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>9.1.4</TD>
<TD WIDTH=55%>Material Breach</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>118</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>9.1.5</TD>
<TD WIDTH=55%>Outside Date</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>118</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>9.1.6</TD>
<TD WIDTH=55%>Superior Proposal</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>119</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>9.2</TD>
<TD WIDTH=65%>Effect of Termination</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>119</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE X</B></TD>
<TD WIDTH=65%>INDEMNIFICATION</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>119</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.1</TD>
<TD WIDTH=65%>Survival</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>119</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.2</TD>
<TD WIDTH=65%>Indemnification</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>120</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.2.1</TD>
<TD WIDTH=55%>General Indemnity by DEI and Seller in Favor of Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>120</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.2.2</TD>
<TD WIDTH=55%>Tax Indemnity by DEI and Seller in Favor of Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>120</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.2.3</TD>
<TD WIDTH=55%>Employee Benefits Indemnity by DEI and Seller in Favor of Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>121</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.2.4</TD>
<TD WIDTH=55%>General Indemnity by Buyer in Favor of DEI and Seller</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>121</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.3</TD>
<TD WIDTH=65%>Indemnification Procedure</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>121</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.4</TD>
<TD WIDTH=65%>Basket</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>122</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>10.5</TD>
<TD WIDTH=65%>Maximum Liability</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>123</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT><B>ARTICLE XI</B></TD>
<TD WIDTH=65%>GENERAL</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>123</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.1</TD>
<TD WIDTH=65%>Entire Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>123</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.2</TD>
<TD WIDTH=65%>Annexes and Schedules</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>123</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.3</TD>
<TD WIDTH=65%>Further Assurances</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>123</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.4</TD>
<TD WIDTH=65%>Amendments</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>123</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.5</TD>
<TD WIDTH=65%>No Assignment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>123</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.6</TD>
<TD WIDTH=65%>Effect of Headings</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>124</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.7</TD>
<TD WIDTH=65%>Counterparts; Facsimile Signatures</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>124</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.8</TD>
<TD WIDTH=65%>Publicity and Reports</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>124</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.9</TD>
<TD WIDTH=65%>Confidentiality</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>124</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.10</TD>
<TD WIDTH=65%>No Third Party Beneficiaries</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>125</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.11</TD>
<TD WIDTH=65%>Notices</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>125</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.12</TD>
<TD WIDTH=65%>Expenses</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>127</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.13</TD>
<TD WIDTH=65%>Interest</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>127</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.14</TD>
<TD WIDTH=65%>Waivers</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>127</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.15</TD>
<TD WIDTH=65%>Construction</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>127</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.16</TD>
<TD WIDTH=65%>Severability</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>127</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17</TD>
<TD WIDTH=65%>Dispute Resolution Procedures</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>127</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.1</TD>
<TD WIDTH=55%>Management Negotiations</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>128</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.2</TD>
<TD WIDTH=55%>Arbitrable Disputes</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>128</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.3</TD>
<TD WIDTH=55%>Applicability of California Procedural Law</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>128</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.4</TD>
<TD WIDTH=55%>Arbitration Complaints and Notices</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>128</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.5</TD>
<TD WIDTH=55%>Selection of Arbitrator and Appellate Arbitrators</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>129</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.6</TD>
<TD WIDTH=55%>Arbitrator Neutrality</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>130</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.7</TD>
<TD WIDTH=55%>Emergency Relief</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>130</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.8</TD>
<TD WIDTH=55%>Arbitration Hearing/Arbitrator's Rulings, Statement of Decision and
Judgment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>131</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.9</TD>
<TD WIDTH=55%>Appeal</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>131</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.10</TD>
<TD WIDTH=55%>Jurisdiction/Venue/Enforcement of Award</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>132</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.11</TD>
<TD WIDTH=55%>Discovery</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>132</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.12</TD>
<TD WIDTH=55%>Res Judicata, Collateral Estoppel and Law of the Case</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>132</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.13</TD>
<TD WIDTH=55%>Confidential Proceedings</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>132</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.14</TD>
<TD WIDTH=55%>Arbitrator Fees and Arbitration Costs</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>132</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.15</TD>
<TD WIDTH=55%>Non-Signatory Legal Actions</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>133</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.16</TD>
<TD WIDTH=55%>Expedited Procedures</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>133</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.17</TD>
<TD WIDTH=55%>No Declaratory Relief</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>133</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.18</TD>
<TD WIDTH=55%>Confidentiality Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>133</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.17.19</TD>
<TD WIDTH=55%>Survivability</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>133</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.18</TD>
<TD WIDTH=65%>Governing Law; Remedies</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>133</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.19</TD>
<TD WIDTH=65%>Limitation of Liability</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>134</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=10%>11.20</TD>
<TD WIDTH=65%>Joint and Several Liability of USA Purchaser and Canadian Purchaser</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>134</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEXES (1)<BR>
ANNEX A  Form of Deferred Lease Assignment and Assumption Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX B  Form of Intellectual Property and Technology Assignment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX C  Form of TCP Guaranty and Commitment</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX D-1  Form of Assignment Separate From Certificate</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX D-2  Form of Assignment Separate From Certificate</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX E-1  Form of Opinion of U.S. Counsel for DEI and Seller</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX E-2  Form of Opinion of Canadian Counsel for DEI and Seller</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX F-1  Form of Opinion of U.S. Counsel for Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX F-2  Form of Opinion of Canadian Counsel for Buyer</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX G  Form of License and Conduct of Business Agreement</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX H  Pre-Signing Company Drafts</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>ANNEX I  Pre-Signing Wells Draft</TD>
<TD WIDTH=20% ALIGN=LEFT VALIGN=BOTTOM>1</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>
<U>TDS Schedules</U> (1)<BR>
1.1(a)<BR>
1.1(b)<BR>
1.1(c)<BR>
1.1(d)<BR>
4.1.7 <BR>
4.2.1 <BR>
4.2.2<BR>
4.4<BR>
4.5<BR>
4.5.1<BR>
4.5.3<BR>
4.6.1<BR>
4.7.2<BR>
4.8.2<BR>
4.9<BR>
4.11<BR>
4.12.2<BR>
4.12.3<BR>
4.13<BR>
4.16<BR>
4.18<BR>
4.21<BR>
6.7.1<BR>
6.11.4<BR>
6.11.5<BR>
6.15.1(i)<BR>
6.15.1(ii)<BR>
6.15.1(iii)<BR>
6.15.1(iv)<BR>
6.15.3<BR>
7.1.4<BR>
7.4.1<BR>
7.8<BR>
10.2.1<BR>
<BR>
<U>Buyer Schedules</U> (1)<BR>
1.1<BR>
5.1.5(a)<BR>
5.1.5(a)(i)<BR>
5.1.5(a)(ii)<BR>
5.1.5(b)<BR>
5.4
</TD>
<TD WIDTH=85%><BR>
Acquired Stores Schedule<BR>
Disney Retained Stores Schedule<BR>
Intercompany Agreements and Arrangements<BR>
Retained Assets<BR>
Subsidiaries<BR>
Financial Statements<BR>
Indebtedness; Liabilities or Contingencies<BR>
Tax Returns - Governmental Examinations/Claims<BR>
Material Contracts and Employment Contracts<BR>
No Breach or Default<BR>
Authorization and Enforceability<BR>
Acquired Leases<BR>
Company Information Technology<BR>
No Conflicts<BR>
Legal Proceedings<BR>
Compliance With Law<BR>
Employee Benefit Plans<BR>
Company Plans<BR>
Environmental Compliance<BR>
Absence of Certain Changes and Events<BR>
Labor Matters<BR>
Bank Accounts<BR>
U.K. Lease Guarantees<BR>
**<BR>
Certain Pre-Closing Expenses<BR>
Terms of Transitional Administrative Services Agreement<BR>
Terms of Transitional Distribution Services Agreement<BR>
Terms of Transitional Information Technology Services Agreement<BR>
Terms of Transitional Disney Retained Stores Agreement<BR>
Form of Operating Manual<BR>
Tax Refunds<BR>
Continuing Employees Schedule<BR>
Disney Information Technology<BR>
Actions re: Incident Reports<BR>
<BR>
<BR>
Company Assets Schedule<BR>
TCP Securities<BR>
Capital Stock<BR>
Beneficial Holders of 5% or more of TCP Securities<BR>
Subsidiaries<BR>
Buyer's Financing and Liquidity
</TD>
</TR>
</TABLE>


<P ALIGN=LEFT><FONT SIZE=3>______________________<BR>
** <I>This information is confidential and has been
omitted and separately filed with the Securities and Exchange
Commission</I>.</FONT></P>


<P><FONT SIZE=3>(1) The Company agrees to furnish supplementally a copy of any omitted schedules
to this exhibit to the Securities and Exchange Commission upon request. </FONT></P>

</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>childrens-ex103_120904.htm
<DESCRIPTION>EX-10.3
<TEXT>
<HTML>
<HEAD>
<TITLE>Exhibit 10.3</TITLE>
</HEAD>
<BODY>

<HR SIZE=1 NOSHADE>

<P ALIGN=CENTER><FONT SIZE=3><B>FOURTH AMENDED AND RESTATED<BR>
LOAN AND SECURITY AGREEMENT</B></FONT></P>
<BR>
<BR>
<BR>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>by and among</B></FONT></P>
<BR>
<BR>
<BR>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>THE CHILDREN&#146;S PLACE RETAIL STORES, INC.,<BR>
and<BR>
EACH OF ITS SUBSIDIARIES THAT ARE SIGNATORIES HERETO<BR>
as Borrowers,</B></FONT></P>
<BR>
<BR>
<BR>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>THE FINANCIAL INSTITUTIONS NAMED HEREIN,<BR>
as Lenders,</B></FONT></P>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>and</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>WELLS FARGO RETAIL FINANCE, LLC,<BR>
as Agent</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>CONGRESS FINANCIAL CORPORATION (NEW ENGLAND),</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>as Documentation Agent</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>and</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>LASALLE RETAIL FINANCE, A DIVISION OF LASALLE BUSINESS CREDIT, LLC</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>as Co-Agent</B></FONT></P>

<HR SIZE=1 NOSHADE>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><U><B>TABLE OF CONTENTS</B></U></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;</TD>
<TD WIDTH=75%>&nbsp;</TD>
<TD WIDTH=20% ALIGN=LEFT><U>Page(s)</U></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>1.</TD>
<TD WIDTH=75%>DEFINITIONS AND CONSTRUCTION</TD>
<TD WIDTH=20% ALIGN=LEFT>&nbsp;&nbsp;1</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>1.1</TD>
<TD WIDTH=70%>Definitions</TD>
<TD WIDTH=20% ALIGN=LEFT>18</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>1.2</TD>
<TD WIDTH=70%>Accounting Terms</TD>
<TD WIDTH=20% ALIGN=LEFT>18</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>1.3</TD>
<TD WIDTH=70%>Code</TD>
<TD WIDTH=20% ALIGN=LEFT>18</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>1.4</TD>
<TD WIDTH=70%>Construction</TD>
<TD WIDTH=20% ALIGN=LEFT>18</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>1.5</TD>
<TD WIDTH=70%>Schedules and Exhibits</TD>
<TD WIDTH=20% ALIGN=LEFT>18</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>2.</TD>
<TD WIDTH=75%>LOAN AND TERMS OF PAYMENT</TD>
<TD WIDTH=20% ALIGN=LEFT>18</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.1</TD>
<TD WIDTH=70%>Revolving Advances</TD>
<TD WIDTH=20% ALIGN=LEFT>18</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.2</TD>
<TD WIDTH=70%>Letters of Credit</TD>
<TD WIDTH=20% ALIGN=LEFT>25</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.3</TD>
<TD WIDTH=70%>Intentionally Omitted</TD>
<TD WIDTH=20% ALIGN=LEFT>29</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.4</TD>
<TD WIDTH=70%>Intentionally Omitted</TD>
<TD WIDTH=20% ALIGN=LEFT>29</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.5</TD>
<TD WIDTH=70%>Payments</TD>
<TD WIDTH=20% ALIGN=LEFT>29</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.6</TD>
<TD WIDTH=70%>Overadvances</TD>
<TD WIDTH=20% ALIGN=LEFT>31</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.7</TD>
<TD WIDTH=70%>Interest and Letter of Credit Fees:  Rates, Payments, and Calculations</TD>
<TD WIDTH=20% ALIGN=LEFT>31</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.8</TD>
<TD WIDTH=70%>Collection of Accounts</TD>
<TD WIDTH=20% ALIGN=LEFT>33</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.9</TD>
<TD WIDTH=70%>Crediting Payments; Application of Collections</TD>
<TD WIDTH=20% ALIGN=LEFT>33</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.10</TD>
<TD WIDTH=70%>Designated Account</TD>
<TD WIDTH=20% ALIGN=LEFT>34</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.11</TD>
<TD WIDTH=70%>Maintenance of Loan Account; Statements of Obligations</TD>
<TD WIDTH=20% ALIGN=LEFT>34</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.12</TD>
<TD WIDTH=70%>Fees</TD>
<TD WIDTH=20% ALIGN=LEFT>34</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.13</TD>
<TD WIDTH=70%>LIBOR Rate Loans</TD>
<TD WIDTH=20% ALIGN=LEFT>35</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.14</TD>
<TD WIDTH=70%>Illegality</TD>
<TD WIDTH=20% ALIGN=LEFT>37</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.15</TD>
<TD WIDTH=70%>Requirements of Law</TD>
<TD WIDTH=20% ALIGN=LEFT>37</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.16</TD>
<TD WIDTH=70%>Indemnity</TD>
<TD WIDTH=20% ALIGN=LEFT>39</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>2.17</TD>
<TD WIDTH=70%>Joint and Several Liability of Borrowers</TD>
<TD WIDTH=20% ALIGN=LEFT>39</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>3.</TD>
<TD WIDTH=75%>CONDITIONS; TERM OF AGREEMENT</TD>
<TD WIDTH=20% ALIGN=LEFT>42</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>3.1</TD>
<TD WIDTH=70%>Conditions Precedent to the Initial Advance and the Initial Letter of Credit</TD>
<TD WIDTH=20% ALIGN=LEFT>42</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>3.2</TD>
<TD WIDTH=70%>Conditions Precedent to all Advances and all Letters of Credit</TD>
<TD WIDTH=20% ALIGN=LEFT>42</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>3.3</TD>
<TD WIDTH=70%>Intentionally Omitted</TD>
<TD WIDTH=20% ALIGN=LEFT>43</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>3.4</TD>
<TD WIDTH=70%>Term; Automatic Renewal</TD>
<TD WIDTH=20% ALIGN=LEFT>43</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>3.5</TD>
<TD WIDTH=70%>Effect of Termination</TD>
<TD WIDTH=20% ALIGN=LEFT>43</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>3.6</TD>
<TD WIDTH=70%>Early Termination by Borrowers</TD>
<TD WIDTH=20% ALIGN=LEFT>44</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>4.</TD>
<TD WIDTH=75%>CREATION OF SECURITY INTEREST</TD>
<TD WIDTH=20% ALIGN=LEFT>44</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>4.1</TD>
<TD WIDTH=70%>Grant of Security Interests</TD>
<TD WIDTH=20% ALIGN=LEFT>44</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>4.2</TD>
<TD WIDTH=70%>Negotiable Collateral</TD>
<TD WIDTH=20% ALIGN=LEFT>44</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>4.3</TD>
<TD WIDTH=70%>Collection of Accounts, General Intangibles, and Negotiable Collateral</TD>
<TD WIDTH=20% ALIGN=LEFT>45</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>4.4</TD>
<TD WIDTH=70%>Delivery of Additional Documentation Required</TD>
<TD WIDTH=20% ALIGN=LEFT>45</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>4.5</TD>
<TD WIDTH=70%>Power of Attorney</TD>
<TD WIDTH=20% ALIGN=LEFT>45</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>4.6</TD>
<TD WIDTH=70%>Right to Inspect</TD>
<TD WIDTH=20% ALIGN=LEFT>46</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>5.</TD>
<TD WIDTH=75%>REPRESENTATIONS AND WARRANTIES</TD>
<TD WIDTH=20% ALIGN=LEFT>46</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.1</TD>
<TD WIDTH=70%>No Encumbrances</TD>
<TD WIDTH=20% ALIGN=LEFT>46</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.2</TD>
<TD WIDTH=70%>Eligible Accounts</TD>
<TD WIDTH=20% ALIGN=LEFT>46</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.3</TD>
<TD WIDTH=70%>Eligible Inventory</TD>
<TD WIDTH=20% ALIGN=LEFT>46</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.4</TD>
<TD WIDTH=70%>Equipment</TD>
<TD WIDTH=20% ALIGN=LEFT>46</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.5</TD>
<TD WIDTH=70%>Location of Inventory and Equipment</TD>
<TD WIDTH=20% ALIGN=LEFT>46</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.6</TD>
<TD WIDTH=70%>Inventory Records</TD>
<TD WIDTH=20% ALIGN=LEFT>46</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.7</TD>
<TD WIDTH=70%>Location of Chief Executive Office; FEIN</TD>
<TD WIDTH=20% ALIGN=LEFT>47</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.8</TD>
<TD WIDTH=70%>Due Organization and Qualification; Subsidiaries</TD>
<TD WIDTH=20% ALIGN=LEFT>47</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.9</TD>
<TD WIDTH=70%>Due Authorization; No Conflict</TD>
<TD WIDTH=20% ALIGN=LEFT>47</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.10</TD>
<TD WIDTH=70%>Litigation</TD>
<TD WIDTH=20% ALIGN=LEFT>47</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.11</TD>
<TD WIDTH=70%>No Material Adverse Change</TD>
<TD WIDTH=20% ALIGN=LEFT>48</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.12</TD>
<TD WIDTH=70%>Fraudulent Transfer</TD>
<TD WIDTH=20% ALIGN=LEFT>48</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.13</TD>
<TD WIDTH=70%>Employee Benefits</TD>
<TD WIDTH=20% ALIGN=LEFT>48</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>5.14</TD>
<TD WIDTH=70%>Environmental Condition</TD>
<TD WIDTH=20% ALIGN=LEFT>48</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>6.</TD>
<TD WIDTH=75%>AFFIRMATIVE COVENANTS</TD>
<TD WIDTH=20% ALIGN=LEFT>48</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.1</TD>
<TD WIDTH=70%>Accounting System and Schedules</TD>
<TD WIDTH=20% ALIGN=LEFT>49</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.2</TD>
<TD WIDTH=70%>Financial Statements, Reports, Certificates</TD>
<TD WIDTH=20% ALIGN=LEFT>49</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.3</TD>
<TD WIDTH=70%>Tax Returns</TD>
<TD WIDTH=20% ALIGN=LEFT>50</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.4</TD>
<TD WIDTH=70%>Designation of Inventory</TD>
<TD WIDTH=20% ALIGN=LEFT>50</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.5</TD>
<TD WIDTH=70%>Store Openings and Closings and Rents Reports</TD>
<TD WIDTH=20% ALIGN=LEFT>50</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.6</TD>
<TD WIDTH=70%>Title to Equipment</TD>
<TD WIDTH=20% ALIGN=LEFT>50</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.7</TD>
<TD WIDTH=70%>Maintenance of Equipment</TD>
<TD WIDTH=20% ALIGN=LEFT>51</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.8</TD>
<TD WIDTH=70%>Taxes</TD>
<TD WIDTH=20% ALIGN=LEFT>51</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.9</TD>
<TD WIDTH=70%>Insurance</TD>
<TD WIDTH=20% ALIGN=LEFT>51</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.10</TD>
<TD WIDTH=70%>No Setoffs or Counterclaims</TD>
<TD WIDTH=20% ALIGN=LEFT>51</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.11</TD>
<TD WIDTH=70%>Location of Inventory and Equipment</TD>
<TD WIDTH=20% ALIGN=LEFT>52</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.12</TD>
<TD WIDTH=70%>Compliance with Laws</TD>
<TD WIDTH=20% ALIGN=LEFT>52</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.13</TD>
<TD WIDTH=70%>Employee Benefits</TD>
<TD WIDTH=20% ALIGN=LEFT>52</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>6.14</TD>
<TD WIDTH=70%>Leases</TD>
<TD WIDTH=20% ALIGN=LEFT>53</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>7.</TD>
<TD WIDTH=75%>NEGATIVE COVENANTS</TD>
<TD WIDTH=20% ALIGN=LEFT>53</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.1</TD>
<TD WIDTH=70%>Indebtedness</TD>
<TD WIDTH=20% ALIGN=LEFT>53</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.2</TD>
<TD WIDTH=70%>Liens</TD>
<TD WIDTH=20% ALIGN=LEFT>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.3</TD>
<TD WIDTH=70%>Restrictions on Fundamental Changes</TD>
<TD WIDTH=20% ALIGN=LEFT>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.4</TD>
<TD WIDTH=70%>Disposal of Assets</TD>
<TD WIDTH=20% ALIGN=LEFT>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.5</TD>
<TD WIDTH=70%>Change Name</TD>
<TD WIDTH=20% ALIGN=LEFT>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.6</TD>
<TD WIDTH=70%>Guarantee</TD>
<TD WIDTH=20% ALIGN=LEFT>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.7</TD>
<TD WIDTH=70%>Nature of Business</TD>
<TD WIDTH=20% ALIGN=LEFT>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.8</TD>
<TD WIDTH=70%>Prepayments and Amendments</TD>
<TD WIDTH=20% ALIGN=LEFT>54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.9</TD>
<TD WIDTH=70%>Change of Control</TD>
<TD WIDTH=20% ALIGN=LEFT>55</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.10</TD>
<TD WIDTH=70%>Consignments</TD>
<TD WIDTH=20% ALIGN=LEFT>55</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.11</TD>
<TD WIDTH=70%>Distributions</TD>
<TD WIDTH=20% ALIGN=LEFT>55</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.12</TD>
<TD WIDTH=70%>Accounting Methods</TD>
<TD WIDTH=20% ALIGN=LEFT>55</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.13</TD>
<TD WIDTH=70%>Advances, Investments and Loans</TD>
<TD WIDTH=20% ALIGN=LEFT>55</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.14</TD>
<TD WIDTH=70%>Transactions with Affiliates</TD>
<TD WIDTH=20% ALIGN=LEFT>56</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.15</TD>
<TD WIDTH=70%>Suspension</TD>
<TD WIDTH=20% ALIGN=LEFT>56</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.16</TD>
<TD WIDTH=70%>Use of Proceeds</TD>
<TD WIDTH=20% ALIGN=LEFT>56</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.17</TD>
<TD WIDTH=70%>Change in Location of Chief Executive Office; Inventory and Equipment with Bailees</TD>
<TD WIDTH=20% ALIGN=LEFT>56</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.18</TD>
<TD WIDTH=70%>No Prohibited Transactions Under ERISA</TD>
<TD WIDTH=20% ALIGN=LEFT>56</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.19</TD>
<TD WIDTH=70%>Financial Covenants</TD>
<TD WIDTH=20% ALIGN=LEFT>57</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>7.20</TD>
<TD WIDTH=70%>Capital Expenditures</TD>
<TD WIDTH=20% ALIGN=LEFT>58</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>8.</TD>
<TD WIDTH=75%>EVENTS OF DEFAULT</TD>
<TD WIDTH=20% ALIGN=LEFT>59</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>9.</TD>
<TD WIDTH=75%>THE LENDER GROUP'S RIGHTS AND REMEDIES</TD>
<TD WIDTH=20% ALIGN=LEFT>60</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>9.1</TD>
<TD WIDTH=70%>Rights and Remedies</TD>
<TD WIDTH=20% ALIGN=LEFT>60</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>9.2</TD>
<TD WIDTH=70%>Remedies Cumulative</TD>
<TD WIDTH=20% ALIGN=LEFT>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>10.</TD>
<TD WIDTH=75%>TAXES AND EXPENSES</TD>
<TD WIDTH=20% ALIGN=LEFT>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>11.</TD>
<TD WIDTH=75%>WAIVERS; INDEMNIFICATION</TD>
<TD WIDTH=20% ALIGN=LEFT>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>11.1</TD>
<TD WIDTH=70%>Demand; Protest; etc</TD>
<TD WIDTH=20% ALIGN=LEFT>63</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>11.2</TD>
<TD WIDTH=70%>The Lender Group's Liability for Collateral</TD>
<TD WIDTH=20% ALIGN=LEFT>63</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>11.3</TD>
<TD WIDTH=70%>Indemnification</TD>
<TD WIDTH=20% ALIGN=LEFT>64</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>12.</TD>
<TD WIDTH=75%>NOTICES</TD>
<TD WIDTH=20% ALIGN=LEFT>64</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>13.</TD>
<TD WIDTH=75%>CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER</TD>
<TD WIDTH=20% ALIGN=LEFT>66</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>14.</TD>
<TD WIDTH=75%>DESTRUCTION OF BORROWER'S DOCUMENTS</TD>
<TD WIDTH=20% ALIGN=LEFT>66</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>15.</TD>
<TD WIDTH=75%>ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS</TD>
<TD WIDTH=20% ALIGN=LEFT>66</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>15.1</TD>
<TD WIDTH=70%>Assignments and Participations</TD>
<TD WIDTH=20% ALIGN=LEFT>66</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>15.2</TD>
<TD WIDTH=70%>Successors</TD>
<TD WIDTH=20% ALIGN=LEFT>69</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>16.</TD>
<TD WIDTH=75%>AMENDMENTS; WAIVERS</TD>
<TD WIDTH=20% ALIGN=LEFT>69</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>16.1</TD>
<TD WIDTH=70%>Amendments and Waivers</TD>
<TD WIDTH=20% ALIGN=LEFT>69</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>16.2</TD>
<TD WIDTH=70%>No Waivers; Cumulative Remedies</TD>
<TD WIDTH=20% ALIGN=LEFT>70</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>17.</TD>
<TD WIDTH=75%>AGENT; THE LENDER GROUP</TD>
<TD WIDTH=20% ALIGN=LEFT>70</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.1</TD>
<TD WIDTH=70%>Appointment and Authorization of Agent</TD>
<TD WIDTH=20% ALIGN=LEFT>70</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.2</TD>
<TD WIDTH=70%>Delegation of Duties</TD>
<TD WIDTH=20% ALIGN=LEFT>71</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.3</TD>
<TD WIDTH=70%>Liability of Agent-Related Persons</TD>
<TD WIDTH=20% ALIGN=LEFT>72</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.4</TD>
<TD WIDTH=70%>Reliance by Agent</TD>
<TD WIDTH=20% ALIGN=LEFT>72</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.5</TD>
<TD WIDTH=70%>Notice of Default or Event of Default</TD>
<TD WIDTH=20% ALIGN=LEFT>73</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.6</TD>
<TD WIDTH=70%>Credit Decision</TD>
<TD WIDTH=20% ALIGN=LEFT>74 </TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.7</TD>
<TD WIDTH=70%>Costs and Expenses; Indemnification</TD>
<TD WIDTH=20% ALIGN=LEFT>75</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.8</TD>
<TD WIDTH=70%>Agent in Individual Capacity</TD>
<TD WIDTH=20% ALIGN=LEFT>75</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.9</TD>
<TD WIDTH=70%>Successor Agent</TD>
<TD WIDTH=20% ALIGN=LEFT>76</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.10</TD>
<TD WIDTH=70%>Withholding Tax</TD>
<TD WIDTH=20% ALIGN=LEFT>76</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.11</TD>
<TD WIDTH=70%>Collateral Matters</TD>
<TD WIDTH=20% ALIGN=LEFT>77</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.12</TD>
<TD WIDTH=70%>Restrictions on Actions by Lenders; Sharing of Payments</TD>
<TD WIDTH=20% ALIGN=LEFT>78</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.13</TD>
<TD WIDTH=70%>Agency for Perfection</TD>
<TD WIDTH=20% ALIGN=LEFT>79</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.14</TD>
<TD WIDTH=70%>Payments by Agent to the Lenders</TD>
<TD WIDTH=20% ALIGN=LEFT>79</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.15</TD>
<TD WIDTH=70%>Concerning the Collateral and Related Loan Documents</TD>
<TD WIDTH=20% ALIGN=LEFT>79</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.16</TD>
<TD WIDTH=70%>Field Audits and Examination Reports; Confidentiality; Disclaimers by Lenders;<BR>
Other Reports and Information</TD>
<TD WIDTH=20% ALIGN=LEFT>79</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.17</TD>
<TD WIDTH=70%>Several Obligations; No Liability</TD>
<TD WIDTH=20% ALIGN=LEFT>81</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>17.18</TD>
<TD WIDTH=70%>Documentation Agent; Co-Agent</TD>
<TD WIDTH=20% ALIGN=LEFT>81</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>18.</TD>
<TD WIDTH=75%>GENERAL PROVISIONS</TD>
<TD WIDTH=20% ALIGN=LEFT>81</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>18.1</TD>
<TD WIDTH=70%>Effectiveness</TD>
<TD WIDTH=20% ALIGN=LEFT>81</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>18.2</TD>
<TD WIDTH=70%>Section Headings</TD>
<TD WIDTH=20% ALIGN=LEFT>81</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>18.3</TD>
<TD WIDTH=70%>Interpretation</TD>
<TD WIDTH=20% ALIGN=LEFT>81</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>18.4</TD>
<TD WIDTH=70%>Severability of Provisions</TD>
<TD WIDTH=20% ALIGN=LEFT>82</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>18.5</TD>
<TD WIDTH=70%>Counterparts; Telefacsimile Execution</TD>
<TD WIDTH=20% ALIGN=LEFT>82</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>18.6</TD>
<TD WIDTH=70%>Revival and Reinstatement of Obligations</TD>
<TD WIDTH=20% ALIGN=LEFT>82</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>18.7</TD>
<TD WIDTH=70%>Integration</TD>
<TD WIDTH=20% ALIGN=LEFT>82</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5%>18.8</TD>
<TD WIDTH=70%>Parent as Agent for Borrowers</TD>
<TD WIDTH=20% ALIGN=LEFT>83</TD>
</TR>
</TABLE>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><U>SCHEDULES AND EXHIBITS</U></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Schedule C-1</TD>
<TD WIDTH=75%>Commitments on Closing Date</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Schedule E-1</TD>
<TD WIDTH=75%>Eligible Inventory Locations</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Schedule P-1</TD>
<TD WIDTH=75%>Permitted Liens</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Schedule 5.8</TD>
<TD WIDTH=75%>Subsidiaries</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Schedule 5.13</TD>
<TD WIDTH=75%>ERISA Benefit Plans</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Schedule 5.14</TD>
<TD WIDTH=75%>Environmental Condition</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Schedule 6.11</TD>
<TD WIDTH=75%>Location of Inventory and Equipment</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Schedule 7.1</TD>
<TD WIDTH=75%>Indebtedness</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Exhibit A-1</TD>
<TD WIDTH=75%>Form of Assignment and Acceptance</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Exhibit B-1</TD>
<TD WIDTH=75%>Business Plan for Fiscal Year Ending on or about January 31, 2005</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Exhibit C-1</TD>
<TD WIDTH=75%>Form of Compliance Certificate</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT>Exhibit D-1</TD>
<TD WIDTH=75%>Form of Collateral Certificate</TD>
</TR>
</TABLE>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>FOURTH AMENDED AND RESTATED<BR>
LOAN AND SECURITY AGREEMENT</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>
<B>THIS FOURTH AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT </B>(this
&quot;<U>Agreement</U>&quot;), is entered into this 30<SUP>th </SUP>day of October, 2004, to be effective
as of October 31, 2004, among <B>THE CHILDREN&#146;S PLACE RETAIL STORES,
INC.,</B> a Delaware corporation (&#147;<U>Parent</U>&#148;) and each of
Parent&#146;s Subsidiaries identified on the signature pages hereof (such
Subsidiaries, together with Parent, are referred to hereinafter each
individually as a &#147;<U>Borrower</U>&#148;, and individually and
collectively, jointly and severally, as the &#147;<U>Borrowers</U>&#148;), with
each of its chief executive office located at 915&#160;Secaucus Road, Secaucus,
New&#160;Jersey 07094, on the one hand, and the financial institutions listed on
the signature pages hereof (such financial institutions, together with their
respective successors and assigns, are referred to hereinafter each individually
as a &quot;<U>Lender</U>&quot; and collectively as the
&quot;<U>Lenders</U>&quot;), and <B>WELLS FARGO RETAIL FINANCE, LLC,</B> a
Delaware limited liability company, as Agent, <B>CONGRESS FINANCIAL
CORPORATION (NEW ENGLAND)</B>, a Massachusetts corporation, as Documentation
Agent and <B>LASALLE RETAIL FINANCE, A DIVISION OF LASALLE BUSINESS CREDIT,
LLC</B>, as Co-Agent, on the other hand. </FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B><U>RECITALS</U></B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>A. Parent and Wells Fargo Retail Finance, LLC and certain other Lenders are
parties to that certain Third Amended and Restated Loan and Security Agreement
dated as of April 25, 2003 (as amended, the "Existing Loan Agreement").</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>B. Borrowers, Agent, Documentation Agent, and Lenders desire to amend and
restate in its entirety the Existing Loan Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>The parties agree that the Existing Loan Agreement is amended and restated as
follows:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>1.
DEFINITIONS AND CONSTRUCTION.</B></FONT></P>

<P><FONT
SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>1.1
Definitions</B>. As used in this Agreement, the following terms shall have
the following definitions:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&quot;<U>Account Debtor</U>&quot; means any Person who is or who may become
obligated under, with respect to, or on account of, an Account.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Accounts</U>&quot; means all currently existing and hereafter arising
accounts, contract rights, Revolving Accounts, and all other forms of
obligations owing to Borrower arising out of the sale or lease of goods or the
rendition of services by Borrower, irrespective of whether earned by
performance, and any and all credit insurance, guaranties, or security therefor.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>ACH Transactions</U>&quot; means any cash management or related
services (including the Automated Clearing House processing of electronic funds
transfers through the direct Federal Reserve Fedline system) provided by a Bank
Product Provider for the account of Administrative Borrower or its Subsidiaries.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Acquisition Agreement</U>: means that certain Acquisition Agreement dated October
19, 2004 entered into by and among Hoop Holdings, LLC, Hoop Canada Holdings,
Inc., Disney Enterprises, Inc. and Disney Credit Card Services, Inc. and The
Children's Place Retail Stores, Inc., as guarantor.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Adjusted LIBOR Rate</U>&quot; means, with respect to each Interest
Period for any LIBOR Rate Loan, the rate per annum (rounded upwards, if
necessary, to the next whole multiple of 1/16 of 1% per annum) determined by
dividing (a) the LIBOR Rate for such Interest Period by (b) a percentage equal
to (i) 100% minus (ii) the Reserve Percentage. The Adjusted LIBOR Rate shall be
adjusted on and as of the effective day of any change in the Reserve Percentage.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Administrative Borrower</U>" has the meaning set forth in Section 18.8.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Advances</U>" has the meaning set forth in Section 2.1(a).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Affiliate</U>&quot; means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For purposes of this definition, &quot;control&quot; as applied to
any Person means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of that Person, whether
through the ownership of voting securities, by contract, or otherwise.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Agent</U>&quot; means Wells Fargo Retail, solely in its capacity as
agent for the Lenders, and shall include any successor agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Agent Advance</U>" has the meaning set forth in Section 2.1(h).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Agent Loan</U>" has the meaning set forth in Section 2.1(g).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=95%><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&quot;<U>Agent-Related
Persons</U>&quot; means Agent, together with its Affiliates, and the officers,
directors, employees, counsel, agents, and attorneys-in-fact of Agent and such
Affiliates. </FONT>
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Agent's Account</U>" has the meaning set forth in Section 2.8.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Agent&#146;s Liens</U>&quot; means the Liens granted by Borrowers or
their Subsidiaries to Agent under this Agreement or the other Loan Documents.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Agreement</U>" has the meaning set forth in the preamble hereto.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Applicable Prepayment Premium</U>&quot; means, as of any date of
determination, an amount equal to (a) during the period of time from and after
the date of the execution and delivery of this Agreement up to the date that is
October 31, 2006, 0.50% times the sum of the Maximum Amount, and (b)&#160;at all
times on or after October 31, 2006 there shall not be any prepayment premium.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Assignee</U>" has the meaning set forth in Section 15.1.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Assignment and Acceptance</U>&quot; has the meaning set forth in
<U>Section 15.1(a)</U> and shall be in the form of <U>Exhibit A-1</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Authorized Person</U>" means any officer or other authorized employee of Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Availability</U>&quot; means, as of the date of determination, the
result (so long as such result is a positive number) of (a) the lesser of the
Borrowing Base or the Maximum Amount,
<U>less</U> (b) the Revolving Facility Usage.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Average
Unused Portion of Maximum Amount</U>&quot; means, as of any date of
determination, (a)&#160;an amount equal to the Maximum Amount, <U>less</U>
(b)&#160;the average Daily Balance of Obligations that were outstanding during
the immediately preceding month.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<U>Bank Product</U>&#148; means any financial accommodation extended to
Administrative Borrower or its Subsidiaries by a Bank Product Provider (other
than pursuant to this Agreement) including but not limited to: (a) credit cards,
(b) credit card processing services, (c) debit cards, (d) purchase cards, (e)
ACH Transactions, (f) cash management, including controlled disbursement,
accounts or services, or (g) transactions under Hedge Agreements.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Bank Product Agreements</U>&quot; means those agreements entered into
from time to time by Administrative Borrower or its Subsidiaries with a Bank
Product Provider in connection with the obtaining of any of the Bank
Products.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Bank Product Obligations</U>&quot; means all obligations, liabilities,
contingent reimbursement obligations, fees, and expenses owing by Administrative
Borrower or its Subsidiaries to any Bank Product Provider pursuant to or
evidenced by the Bank Product Agreements and irrespective of whether for the
payment of money, whether direct or indirect, absolute or contingent, due or to
become due, now existing or hereafter arising, and including all such amounts
that Administrative Borrower or its Subsidiaries are obligated to reimburse to
Agent or any member of the Lender Group as a result of Agent or such member of
the Lender Group purchasing participations from, or executing indemnities or
reimbursement obligations to, a Bank Product Provider with respect to the Bank
Products provided by such Bank Product Provider to Administrative Borrower or
its Subsidiaries.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Bank Product Provider</U>" means Wells Fargo or any of its Affiliates.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Bank
Product Reserve</U>&quot; means, as of any date of determination, the amount of
reserves that Agent has established (based upon the Bank Product Providers'
reasonable determination of the credit exposure in respect of the Bank Products)
in respect of Bank Products then provided or outstanding.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Bankruptcy Code</U>" means the United States Bankruptcy Code (11 U.S.C.ss. 101 et
seq.), as amended, and any successor statute.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Benefit Plan</U>&quot; means a &quot;defined benefit plan&quot; (as
defined in Section 3(35) of ERISA) for which Borrower, any Subsidiary of
Borrower, or any ERISA Affiliate has been an &quot;employer&quot; (as defined in
Section 3(5) of ERISA) within the past six years.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Books</U>&quot; means all of Administrative Borrower's and its
Subsidiaries books and records including: ledgers; records indicating,
summarizing, or evidencing Borrower's properties or assets (including the
Collateral) or liabilities; all information relating to Borrower's business
operations or financial condition; and all computer programs, disk or tape
files, printouts, runs, or other computer prepared information.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Borrower</U>&quot; and &#147;<U>Borrowers</U>&#148; have the respective
meanings set forth in the preamble to this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Borrowing</U>&quot; means a borrowing hereunder consisting of Advances
made on the same day by the Lenders, or by Agent in the case of an Agent Loan or
an Agent Advance.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Borrowing Base</U>" has the meaning set forth in Section 2.1(a).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Business Day</U>&quot; means (a) any day that is not a Saturday,
Sunday, or a day on which banks in Boston, Massachusetts, are required or
permitted to be closed, and (b) with respect to all notices, determinations,
fundings and payments in connection with the LIBOR Rate or LIBOR Rate Loans, any
day that is a Business Day pursuant to clause (a) above and that is also a day
on which trading in Dollars is carried on by and between banks in the London
interbank market.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<U>Business Plan</U>&#148; means Parent&#146;s and its Subsidiaries&#146;
business plans attached hereto as Exhibit B-1, together with any amendment,
modification, or revision to such business plan approved by Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Change of Control</U>&quot; shall be deemed to have occurred at such
time as Parent&#146;s existing shareholders cease to be the &quot;beneficial
owners&quot; (as defined in Rule 13d-3 under the Securities Exchange Act of
1934), directly or indirectly, of more than 25% of the total voting power of all
classes of stock then outstanding of Parent normally entitled to vote in the
election of directors.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Children&#146;s Place Canada</U>&quot; means The Children&#146;s Place
(Canada), LP, an Ontario limited partnership.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Closing Date</U>&quot; means the date of the first to occur of the
making of the initial Advance or the issuance of the initial Letter of Credit.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Code</U>" means the California Uniform Commercial Code.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Collateral</U>" means each of the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Accounts,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Books,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Equipment,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the General Intangibles,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the Inventory,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) the Investment Property,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) the Negotiable Collateral,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) any money, or other assets of
any Borrower that now or hereafter come into the possession, custody, or control
of the Lender Group, and</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the proceeds and products,
whether tangible or intangible, of any of the foregoing, including proceeds of
insurance covering any or all of the Collateral, and any and all Accounts,
Books, Equipment, General Intangibles, Inventory, Investment Property,
Negotiable Collateral, money, deposit accounts, or other tangible or intangible
property resulting from the sale, exchange, collection, or other disposition of
any of the foregoing, or any portion thereof or interest therein, and the
proceeds thereof.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<U>Collateral</U>&#148; expressly excludes any share of stock, membership
interest, or other ownership interest in and to Hoop Holdings, LLC, Hoop Retail
Stores, LLC or The Disney Store, LLC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Collateral Access Agreement</U>&quot; means a landlord waiver,
mortgagee waiver, bailee letter, or acknowledgment agreement of any
warehouseman, processor, lessor, consignee, or other Person in possession of,
having a Lien upon, or having rights or interests in the Equipment or Inventory,
in each case, in form and substance satisfactory to Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Collections</U>&quot;
means all cash, checks, notes, instruments, and other items of payment
(including, insurance proceeds, proceeds of cash sales, rental proceeds, and tax
refunds).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Commitment</U>&quot; means, at any time with respect to a Lender, the
principal amount set forth beside such Lender's name under the heading
&quot;Commitment&quot; on
<U>Schedule&#160;C-1</U> or on the signature page of the Assignment and
Acceptance pursuant to which such Lender became a Lender hereunder in accordance
with the provisions of <U>Section&#160;15.1</U>, as such Commitment may be
adjusted from time to time in accordance with the provisions of
<U>Section&#160;15.1</U> and &quot;Commitments&quot; means, collectively, the
aggregate amount of the commitments of all of the Lenders.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Compliance Certificate</U>&quot; means a certificate substantially in
the form of
<U>Exhibit&#160;C-1</U> and delivered by the chief accounting officer of Parent
to Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Daily Balance</U>&quot; means, with respect to each day during the term
of this Agreement, the amount of an Obligation owed at the end of such day.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>deems itself insecure</U>&quot; means that the Person deems itself
insecure in accordance with the provisions of Section 1208 of the Code.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Default</U>&quot; means an event, condition, or default that, with the
giving of notice, the passage of time, or both, would be an Event of Default.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Defaulting Lender</U>" has the meaning set forth in <U>Section 2.1(f)(ii)</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Defaulting Lenders Rate</U>&quot; means the Reference Rate for the
first three days from and after the date the relevant payment is due and
thereafter at the interest rate then applicable to Advances.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Designated Account</U>&quot; means account number 20-3024941126-6 of
Administrative Borrower maintained with Administrative Borrower's Designated
Account Bank, or such other deposit account of Administrative Borrower (located
within the United States) which has been designated, in writing and from time to
time, by Administrative Borrower to Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Designated Account Bank</U>&quot; means Wachovia National Bank, whose
office is located at 100 Fidelity Plaza, North Brunswick, New Jersey 08905 and
whose ABA number is 021200025.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Disney License Agreement</U>&quot; means that certain License and
Conduct of Business Agreement to be entered into by and among certain
subsidiaries of the Borrower and TDS Franchising, LLC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Disney
Stores Acquisition</U>&quot; means the transaction, as a totality, comprised of
the acquisition by Hoop Holdings, LLC and Hoop Canada Holdings, Inc. of the
ownership interests in, and business and assets of, The Disney Store, LLC and
The Disney Store (Canada) Ltd., as more particularly set forth in the
Acquisition Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Documentation Agent</U>&quot; means Congress Financial Corporation (New
England), a Massachusetts corporation, solely in its capacity as Documentation
Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Dollars or $</U>" means United States dollars.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Eligible Accounts</U>&quot; means under Five (5) business day accounts due on a
non-recourse basis from major credit card processors (which, if due on account
of a private label credit card program, are deemed in the discretion of the
Agent to be eligible).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Eligible Inventory</U>&quot; means Inventory consisting of first
quality finished goods held for sale in the ordinary course of the Borrowers'
business (other than inventory of Children&#146;s Place Canada), that is
reasonably acceptable to Agent in all respects, that is located at a Borrower's
premises identified on Schedule E-1 or that is in transit to a Borrower if: (a)
title to such Inventory has been transferred to such Borrower, (b) the Inventory
is insured to Agent's reasonable satisfaction and (c) documentation regarding
such Inventory is reasonably acceptable to Agent, and such Inventory strictly
complies with all of Borrowers' representations and warranties to the Lender
Group. If Eligible Inventory is in transit to a Borrower and has been acquired
pursuant to a Letter of Credit, the Letter of Credit must have been drawn upon.
Eligible Inventory shall not include slow moving Inventory (as determined in
Agent's reasonable business judgment based upon industry practices), or obsolete
items, restrictive or custom items, raw materials, work-in-process, components
that are not part of finished goods, spare parts, packaging and shipping
materials, supplies used or consumed in a Borrower's business, Inventory subject
to a security interest or lien in favor of any third Person, bill and hold
goods, Inventory that is not subject to Agent's perfected security interests,
defective goods (except for minor defects that do not affect saleability),
&quot;seconds,&quot; and Inventory acquired on consignment.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Eligible Transferee</U>&quot; means (a) a commercial bank organized
under the laws of the United States, or any state thereof, and having total
assets in excess of $5,000,000,000, or the asset based lending Affiliate of such
bank, (b) a commercial bank organized under the laws of any other country which
is a member of the Organization for Economic Cooperation and Development or a
political subdivision of any such country, and having total assets in excess of
$5,000,000,000, or the asset based lending Affiliate of such bank; provided that
such bank is acting through a branch or agency located in the United States, (c)
a finance company, insurance or other financial institution, or fund that is
engaged in making, purchasing, or otherwise investing in commercial loans in the
ordinary course of its business and having total assets in excess of
$500,000,000, (d) any Affiliate (other than individuals) of an existing Lender,
and (e) any other Person approved by Agent and Parent. </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Equipment</U>&quot; means all of Borrowers' present and hereafter
acquired machinery, machine tools, motors, equipment, furniture, furnishings,
fixtures, vehicles (including motor vehicles and trailers), tools, parts, goods
(other than consumer goods, farm products, or Inventory), wherever located,
including, (a)&#160;any interest of any Borrower in any of the foregoing, and
(b)&#160;all attachments, accessories, accessions, replacements, substitutions,
additions, and improvements to any of the foregoing. </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>ERISA</U>&quot; means the Employee Retirement Income Security Act of
1974, 29 U.S.C. &#167;&#167; 1000 et seq., amendments thereto, successor
statutes, and regulations or guidance promulgated thereunder.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>ERISA Affiliate</U>&quot; means any trade or business (whether or not
incorporated) which, within the meaning of Section 414 of the IRC, is: (i) under
common control with any Borrower; (ii) treated, together with any Borrower, as a
single employer; (iii) treated as a member of an affiliated service group of
which any Borrower is also treated as a member; or (iv) is otherwise aggregated
with any Borrower for purposes of the employee benefits requirements listed in
IRC Section 414(m)(4).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>ERISA Event</U>&quot; means (a) a Reportable Event with respect to any
Benefit Plan or Multiemployer Plan, (b) the withdrawal of any Borrower, any of
its Subsidiaries or ERISA Affiliates from a Benefit Plan during a plan year in
which it was a &quot;substantial employer&quot; (as defined in Section
4001(a)(2) of ERISA), (c) the providing of notice of intent to terminate a
Benefit Plan in a distress termination (as described in Section 4041(c) of
ERISA), (d) the institution by the PBGC of proceedings to terminate a Benefit
Plan or Multiemployer Plan, (e) any event or condition (i) that provides a basis
under Section 4042(a)(1), (2), or (3) of ERISA for the termination of, or the
appointment of a trustee to administer, any Benefit Plan or Multiemployer Plan,
or (ii) that may result in termination of a Multiemployer Plan pursuant to
Section 4041A of ERISA, (f) the partial or complete withdrawal within the
meaning of Sections 4203 and 4205 of ERISA, of any Borrower, any of its
Subsidiaries or ERISA Affiliates from a Multiemployer Plan, or (g) providing any
security to any Plan under Section 401(a)(29) of the IRC by any Borrower or its
Subsidiaries or any of their ERISA Affiliates.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Event of Default</U>" has the meaning set forth in Section 8.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<U>Fee Letter</U>&#148; means that certain Fee Letter dated as of October
31, 2004 entered into by and between the Agent and the Borrowers.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>FEIN</U>" means Federal Employer Identification Number.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Fiscal Month</U>&quot; means months computed on the retail basis of
four weeks, five weeks and four weeks per fiscal quarter.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Fiscal Year</U>" means a retail year ending on the Saturday closest to
January 31.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Funding Date</U>" means the date on which a Borrowing occurs.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>GAAP</U>&quot; means generally accepted accounting principles as in
effect from time to time in the United States, consistently applied.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>General Intangibles</U>&quot; means all of Borrowers' present and
future general intangibles and other personal property (including contract
rights, rights arising under common law, statutes, or regulations, choses or
things in action, goodwill, patents, trade names, copyrights, blueprints,
drawings, purchase orders, customer lists, monies due or recoverable from
pension funds, route lists, rights to payment and other rights under any royalty
or licensing agreements, infringement claims, computer programs, information
contained on computer disks or tapes, literature, reports, catalogs, deposit
accounts, insurance premium rebates, tax refunds, and tax refund claims), other
than goods, Accounts, and Negotiable Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Governing Documents</U>&quot; means the certificate or articles of
incorporation, by-laws, or other organizational or governing documents of any
Person.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Governmental Authority</U>&quot; means any nation or government, any
state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Guaranties</U>&quot; means those certain General Continuing Guaranties
executed by Guarantors in favor of Agent and Lenders.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Guarantors</U>" means Twin Brook, thechildrensplace.com, inc., The
Children's Place Canada Holdings, Inc. and The Children's Place (Virginia), Inc.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Hazardous Materials</U>&quot; means (a) substances that are defined or
listed in, or otherwise classified pursuant to, any applicable laws or
regulations as &quot;hazardous substances,&quot; &quot;hazardous
materials,&quot; &quot;hazardous wastes,&quot; &quot;toxic substances,&quot; or
any other formulation intended to define, list, or classify substances by reason
of deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, reproductive toxicity, or &quot;EP toxicity&quot;, (b) oil,
petroleum, or petroleum derived substances, natural gas, natural gas liquids,
synthetic gas, drilling fluids, produced waters, and other wastes associated
with the exploration, development, or production of crude oil, natural gas, or
geothermal resources, (c) any flammable substances or explosives or any
radioactive materials, and (d) asbestos in any form or electrical equipment that
contains any oil or dielectric fluid containing levels of polychlorinated
biphenyls in excess of 50 parts per million.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Hedge Agreement</U>&quot; means any and all agreements, or documents
now existing or hereafter entered into by Administrative Borrower or its
Subsidiaries that provide for an interest rate, credit, commodity or equity
swap, cap, floor, collar, forward foreign exchange transaction, currency swap,
cross currency rate swap, currency option, or any combination of, or option with
respect to, these or similar transactions, for the purpose of hedging
Administrative Borrower's or its Subsidiaries&#146; exposure to fluctuations in
interest or exchange rates, loan, credit exchange, security or currency
valuations or commodity prices. </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Indebtedness</U>&quot; means as to all of Borrowers (a)&#160;all
obligations for borrowed money, (b)&#160;all obligations evidenced by bonds,
debentures, notes, or other similar instruments and all reimbursement or other
obligations in respect of letters of credit, bankers acceptances, interest rate
swaps, or other financial products, (c)&#160;all obligations as a lessee under
capital leases, (d)&#160;all obligations or liabilities of others secured by a
Lien on any asset of a Person or its Subsidiaries, irrespective of whether such
obligation or liability is assumed, (e)&#160;all obligations to pay the deferred
purchase price of assets (other than trade payables incurred in the ordinary
course of business and repayable in accordance with customary trade practices),
(f)&#160;all obligations owing under Hedge Agreements, and (g)&#160;any
obligation guaranteeing or intended to guarantee (whether directly or indirectly
guaranteed, endorsed, co-made, discounted, or sold with recourse) any obligation
of any other Person that constitutes Indebtedness under any of clauses (a)
through (f) above.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Indemnified Liabilities</U>" has the meaning set forth in <U>Section 11.3</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Insolvency Proceeding</U>&quot; means any proceeding commenced by or
against any Person under any provision of the Bankruptcy Code or under any other
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.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Intangible Assets</U>&quot; means, with respect to any Person, that
portion of the book value of all of such Person's assets that would be treated
as intangibles under GAAP.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Interest Period</U>&quot; means, for any LIBOR Rate Loan, the period
commencing on the Business Day such LIBOR Rate Loan is disbursed or continued,
or on the Business Day on which a Reference Rate Loan is converted to such LIBOR
Rate Loan, and ending on the date that is one, three or six months thereafter,
as selected by Administrative Borrower and notified to Agent as provided in
<U>Sections&#160;2.13(a) and (b)</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Inventory</U>&quot; means all present and future inventory (other than
inventory of Children&#146;s Place Canada) in which any Borrower has any
interest, including goods held for sale or lease or to be furnished under a
contract of service and all of any Borrower's present and future raw materials,
work in process, finished goods, and packing and shipping materials, wherever
located.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Inventory Reserves</U>&quot; means reserves (determined from time to
time by Agent in its discretion) for (a) the estimated costs relating to unpaid
freight charges, warehousing or storage charges, taxes, duties, and other
similar unpaid costs associated with the acquisition of Eligible In-Transit
Inventory by Borrowers, plus (b)&#160;the estimated reclamation claims of unpaid
sellers of Inventory sold to Borrowers.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Investment Property</U>&quot; means all of Borrowers&#146; presently
existing and hereafter acquired or arising investment property (as that term is
defined in Section 9115 of the Code).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>IRC</U>" means the Internal Revenue Code of 1986, as amended, and the
regulations thereunder.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>L/C</U>" has the meaning set forth in <U>Section 2.2(a)</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>L/C Guaranty</U>" has the meaning set forth in <U>Section 2.2(a)</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Lender&quot; and &quot;Lenders</U>&quot; have the respective meanings
set forth in the preamble to this Agreement, and shall include any other Person
made a party to this Agreement in accordance with the provisions of <U>Section
15.1</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Lender Group</U>&quot; means, individually and collectively, each of
the individual Lenders and Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Lender Group Expenses</U>&quot; means all: reasonable costs or expenses
(including taxes, and insurance premiums) required to be paid by a Borrower or
its Subsidiaries under any of the Loan Documents that are paid or incurred by
the Lender Group; reasonable fees or charges paid or incurred by the Lender
Group in connection with the Lender Group's transactions with Borrowers,
including, fees or charges for photocopying, notarization, couriers and
messengers, telecommunication, public record searches (including tax lien,
litigation, and UCC searches and including searches with the patent and
trademark office, the copyright office, or the department of motor vehicles),
filing, recording, publication, appraisal (including periodic Collateral
appraisals); environmental audits; costs and expenses incurred by Agent in the
disbursement of funds to Borrowers (by wire transfer or otherwise); charges paid
or incurred by Agent resulting from the dishonor of checks; costs and expenses
paid or incurred by Agent to correct any default or enforce any provision of the
Loan Documents, or in gaining possession of, maintaining, handling, preserving,
storing, shipping, selling, preparing for sale, or advertising to sell the
Collateral, or any portion thereof, irrespective of whether a sale is
consummated; reasonable costs and expenses paid or incurred by the Lender Group
in examining Books; costs and expenses of third party claims or any other suit
paid or incurred by the Lender Group in enforcing or defending the Loan
Documents or in connection with the transactions contemplated by the Loan
Documents or the Lender Group's relationship with Borrowers or any guarantor;
and the Lender Group's reasonable attorneys fees and expenses incurred in
advising, structuring, drafting, reviewing, administering, amending,
terminating, enforcing, defending, or concerning the Loan Documents (including
attorneys fees and expenses incurred in connection with a &quot;workout,&quot; a
&quot;restructuring,&quot; or an Insolvency Proceeding concerning Borrowers or
any guarantor of the Obligations), irrespective of whether suit is brought.
Notwithstanding anything to the contrary set forth herein, the foregoing shall
be subject to the limitations set forth in <U>Section&#160;2.12(e)</U>
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Letter of Credit</U>" means an L/C or an L/C Guaranty, as the context requires.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Letter of Credit Amount</U>" means 0.75% per annum.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>LIBOR Rate</U>&quot; means, with respect to the Interest Period for a
LIBOR Rate Loan, the interest rate per annum (rounded upwards, if necessary, to
the next whole multiple of 1/16 of 1% per annum) at which United States dollar
deposits are offered to Wells Fargo (or its Affiliates) by major banks in the
London interbank market (or other LIBOR Rate market selected by Agent) on or
about 11:00 a.m. (Boston time) two Business Days prior to the commencement of
such Interest Period in amounts comparable to the amount of the LIBOR Rate Loans
requested by and available to Borrower in accordance with this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>LIBOR Rate Loans</U>&quot; means any Advance (or any portion thereof)
made or outstanding hereunder during any period when interest on such Advance
(or portion thereof) is payable based on the Adjusted LIBOR Rate.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>LIBOR Rate Margin</U>&quot; means commencing with October&#160;31, 2004
and at the end of each Fiscal Month thereafter to the following levels
corresponding to the following amount of Availability:</TD>
</TR>
</TABLE>
<BR>

<PRE>


           Amount of Availability                       LIBOR Rate Margin
          ------------------------                     -------------------

        Greater than $40,000,000                              1.50%

        Equal to or less than $40,000,000 and                 1.75%
        greater than $30,000,000

        Equal to or less than $30,000,00 and                  2.25%
        greater than $20,000,000

        Equal to or less than $20,000,000 and                 2.75%
        greater than $10,000,000

        Less than $10,000,000                  3.00% (subject, however, to waiver by
                                                        the Required Lenders)

</PRE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Lien</U>&quot; means any interest in property securing an obligation
owed to, or a claim by, any Person other than the owner of the property, whether
such interest shall be based on the common law, statute, or contract, whether
such interest shall be recorded or perfected, and whether such interest shall be
contingent upon the occurrence of some future event or events or the existence
of some future circumstance or circumstances, including the lien or security
interest arising from a mortgage, deed of trust, encumbrance, pledge,
hypothecation, assignment, deposit arrangement, security agreement, adverse
claim or charge, conditional sale or trust receipt, or from a lease,
consignment, or bailment for security purposes and also including reservations,
exceptions, encroachments, easements, rights-of-way, covenants, conditions,
restrictions, leases, and other title exceptions and encumbrances affecting Real
Property.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Loan Account</U>" has the meaning set forth in <U>Section 2.11</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Loan Documents</U>&quot; means this Agreement, the Bank Products
Agreements, the Letters of Credit, the Lockbox Agreements, any note or notes
executed by Borrower and payable to the Lender Group, and any other agreement
entered into, now or in the future, in connection with this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Lockbox Account</U>&quot; shall mean a depositary account established
pursuant to one of the Lockbox Agreements.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Lockbox Agreements</U>&quot; means those certain Lockbox Operating
Procedural Agreements and those certain Depository Account Agreements, in form
and substance satisfactory to Agent, each of which is among Administrative
Borrower, Agent, and one of the Lockbox Banks.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Lockbox Banks</U>&quot; means Wachovia National Bank, or any
replacement bank chosen by Borrower and acceptable to Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Lockboxes</U>" has the meaning set forth in <U>Section 2.8</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Material Adverse Change</U>&quot; means (a)&#160;a material adverse
change in the business, prospects, operations, results of operations, assets,
liabilities or condition (financial or otherwise) of Borrowers and their
Subsidiaries, (b)&#160;the material impairment of a Borrower's ability to
perform its obligations under the Loan Documents to which it is a party or of
the Lender Group to enforce the Obligations or realize upon the Collateral,
(c)&#160;a material adverse effect on the value of the Collateral or the amount
that the Lender Group would be likely to receive (after giving consideration to
delays in payment and costs of enforcement) in the liquidation of such
Collateral, or (d) a material impairment of the priority of the Lender Group's
Liens with respect to the Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Maximum Amount</U>&quot; means $130,000,000 <U>plus</U> the amount of
the Temporary Overadvance Facility, if it is then outstanding.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Multiemployer Plan</U>&quot; means a &quot;multiemployer plan&quot; (as
defined in <U>Section 4001(a)(3)</U> of ERISA) to which Parent, any of its
Subsidiaries, or any ERISA Affiliate has contributed, or was obligated to
contribute, within the past six years.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Negotiable Collateral</U>&quot; means all of Borrowers' present and
future letters of credit, notes, drafts, instruments, certificated and
uncertificated securities (including the shares of stock of Subsidiaries of
Parent (other than Hoop Holdings, LLC, Hoop Retail Stores, LLC or The Disney
Store, LLC), but limited to 65% of the outstanding shares of each class of stock
of any foreign Subsidiary), investment property, security entitlements,
documents, personal property leases (wherein a Borrower is the lessor), chattel
paper, and Books relating to any of the foregoing.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>NRLV</U>&quot; means at any time of determination thereof, the ratio,
expressed as a percentage, of the net retail liquidation value of
Borrowers&#146; Inventory divided by the retail value of such Inventory, all as
set forth in the most recent appraisal delivered to, and approved by Agent.
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Obligations</U>&quot; means (a)&#160;all loans, Advances, debts,
principal, interest (including any interest that, but for the provisions of the
Bankruptcy Code, would have accrued), contingent reimbursement obligations under
any outstanding Letters of Credit, liabilities (including all amounts charged to
Borrowers' Loan Account pursuant hereto), obligations, fees, charges, costs, or
Lender Group Expenses (including any fees or expenses that, but for the
provisions of the Bankruptcy Code, would have accrued), lease payments,
guaranties, covenants, and duties owing by Borrowers to the Lender Group of any
kind and description (whether pursuant to or evidenced by the Loan Documents or
pursuant to any other agreement between the Lender Group and any Borrower, and
irrespective of whether for the payment of money), whether direct or indirect,
absolute or contingent, due or to become due, now existing or hereafter arising,
and including any debt, liability, or obligation owing from any Borrower to
others that the Lender Group may have obtained by assignment or otherwise, and
further including all interest not paid when due and all Lender Group Expenses
that Borrowers are required to pay or reimburse by the Loan Documents, by law,
or otherwise, and (b)&#160;all Bank Product Obligations. Any reference in this
Agreement or in the Loan Documents to the Obligations shall include all
extensions, modifications, renewals, or alterations thereof, both prior and
subsequent to any Insolvency Proceeding.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Originating Lender</U>" has the meaning set forth in <U>Section 15.1(e)</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Overadvance</U>" has the meaning set forth in <U>Section 2.6</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Overadvance Amount</U>" means up to $30,000,000.00 at any one time outstanding.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Parent</U>" has the meaning set forth in the preamble of this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Participant</U>" has the meaning set forth in <U>Section 15.1(c)</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>PBGC</U>&quot; means the Pension Benefit Guaranty Corporation as
defined in Title IV of ERISA, or any successor thereto.
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Permitted Liens</U>&quot; means (a) Liens held by the Lender Group, (b)
Liens for unpaid taxes that either (i) are not yet due and payable or (ii) are
the subject of Permitted Protests, (c) Liens set forth on <U>Schedule P-1</U>,
(d) the interests of lessors under operating leases and purchase money security
interests and Liens of lessors under capital leases to the extent that the
acquisition or lease of the underlying asset is permitted under <U>Section
7.21</U> and so long as the Lien only attaches to the asset purchased or
acquired and only secures the purchase price of the asset, (e) Liens arising by
operation of law in favor of warehousemen, landlords, carriers, mechanics,
materialmen, laborers, or suppliers, incurred in the ordinary course of business
of Borrowers and not in connection with the borrowing of money, and which Liens
either (i) are for sums not yet due and payable, or (ii) are the subject of
Permitted Protests, (f) Liens arising from deposits made in connection with
obtaining worker's compensation or other unemployment insurance, (g) Liens or
deposits to secure performance of bids, tenders, or leases (to the extent
permitted under this Agreement), incurred in the ordinary course of business of
Borrowers and not in connection with the borrowing of money, (h) Liens arising
by reason of security for surety or appeal bonds in the ordinary course of
business of any Borrower, (i) Liens of or resulting from any judgment or award
that would not cause a Material Adverse Change and as to which the time for the
appeal or petition for rehearing of which has not yet expired, or in respect of
which any Borrower is in good faith prosecuting an appeal or proceeding for a
review, and in respect of which a stay of execution pending such appeal or
proceeding for review has been secured, and (j)&#160;with respect to any Real
Property, easements, rights of way, zoning and similar covenants and
restrictions, and similar encumbrances that customarily exist on properties of
Persons engaged in similar activities and similarly situated and that in any
event do not materially interfere with or impair the use or operation of the
Collateral by Borrowers or the value of the Lender Group's Lien thereon or
therein, or materially interfere with the ordinary conduct of the business of
Borrowers.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Permitted Protest</U>&quot; means the right of Borrowers to protest any
Lien (other than any such Lien that secures the Obligations), tax (other than
payroll taxes or taxes that are the subject of a United States federal tax
lien), or rental payment, provided that (a)&#160;a reserve with respect to such
obligation is established on the books of Borrowers in an amount that is
reasonably satisfactory to Agent, (b)&#160;any such protest is instituted and
diligently prosecuted by Borrowers in good faith, and (c)&#160;Agent is
satisfied that, while any such protest is pending, there will be no impairment
of the enforceability, validity, or priority of any of the Liens of the Lender
Group in and to the Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Person</U>&quot; means and includes natural persons, corporations,
limited liability companies, limited partnerships, general partnerships, limited
liability partnerships, joint ventures, trusts, land trusts, business trusts, or
other organizations, irrespective of whether they are legal entities, and
governments and agencies and political subdivisions thereof.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Plan</U>&quot; means any employee benefit plan, program, or arrangement
maintained or contributed to by any Borrower or with respect to which it may
incur liability.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Pro-Rata Share</U>&quot; means, with respect to a Lender, a fraction
(expressed as a percentage), the numerator of which is the amount of such
Lender's Commitment and the denominator of which is the aggregate amount of the
Commitments.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Real Property</U>&quot; means any estates or interests in real property
now owned or hereafter acquired by any Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Reference Rate</U>&quot; the rate of interest announced within Wells
Fargo at its principal office in San Francisco as its &#147;prime rate&#148;,
with the understanding that the &#147;prime rate&#148; is one of Wells
Fargo&#146;s base rates (not necessarily the lowest of such rates) and serves as
the basis upon which effective rates of interest are calculated for those loans
making reference thereto and is evidenced by the recording thereof after its
announcement in such internal publication or publications as Wells Fargo may
designate.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<U>Reference Rate Loans</U>&#148; means any advance (or portion thereof)
made or outstanding hereunder during any period when interest on such Advance is
payable based on the Reference Rate.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Renewal Date</U>" has the meaning set forth in <U>Section 3.4</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Reportable Event</U>&quot; means any of the events described in
<U>Section 4043(c)</U> of ERISA or the regulations thereunder other than a
Reportable Event as to which the provision of 30 days notice to the PBGC is
waived under applicable regulations.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Required Lenders</U>&quot; means, at any time, Agent together with such
other Lenders whose Pro Rata Shares together with Agent aggregate 50.1% or more
of the Commitments; <U>provided</U>, <U>however</U>, that (a) in all
circumstances in which there are two or more Lenders, Required Lenders shall
include at least one Lender that is not the Agent or an Affiliate of Agent; (b)
&#147;Commitments&#148; shall not include the Overadvance Amount in determining
Required Lenders, and (c) in connection with the providing of consent for (i)
payment by the Borrowers of any of their indemnification obligations to the Walt
Disney Companies, as set forth in Section 7.16, below, Required Lenders shall
mean the Agent together with such other Lenders whose Pro Rata Shares together
with Agent aggregate 66 2/3% or more of the Commitments, and (ii) extension of
the term of the Temporary Overadvance Facility beyond December 31, 2004 or
postponement of the time for repayment thereof, Required Lenders shall mean all
of the Lenders, unanimously.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Requirement of Law</U>&quot; means, as to any Person: (a) (i) all
statutes and regulations and (ii) court orders and injunctions, arbitrators'
decisions, and/or similar rulings, in each instance by any Governmental
Authority or arbitrator applicable to or binding upon such Person or any of such
Person's property or to which such Person or any of such Person's property is
subject; and (b) that Person's organizational documents, by-laws and/or other
instruments which deal with corporate or similar governance, as applicable.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Reserve Percentage</U>&quot; for any Interest Period means, as of the
date of determination thereof, the maximum percentage (rounded upward, if
necessary to the nearest 1/100th of 1%), as determined by Agent (or its
Affiliates) in accordance with its (or their) usual procedures (which
determination shall be conclusive in the absence of manifest error), that is in
effect on such date as prescribed by the Board of Governors of the Federal
Reserve System for determining the reserve requirements (including supplemental,
marginal, and emergency reserve requirements) with respect to eurocurrency
funding (currently referred to as &quot;eurocurrency liabilities&quot;) having a
term equal to such Interest Period by Agent or its Affiliates.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Restructuring Transaction</U>&quot; means (i) the formation of Services
Company and Twin Brook by the Parent, (ii) the transfer of certain
non-operational assets from the Parent and other of its Subsidiaries to Services
Company, (iii) the transfer of the membership interests in Services Company from
the Parent to Twin Brook and (iv) the merger of TCPIP, Inc. with and into
Services Company.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Retiree Health Plan</U>&quot; means an &quot;employee welfare benefit
plan&quot; within the meaning of <U>Section 3(1)</U> of ERISA that provides
benefits to individuals after termination of their employment, other than as
required by Section 601 of ERISA.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Revolving Accounts</U>&quot; means any Account arising from an
agreement to extend credit on an ongoing basis through the use of a device such
as a credit card or the like, whether or not subject to regulation under Federal
Reserve Board Regulation Z, or any state statute or regulation on
truth-in-lending.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Revolving Facility Usage</U>&quot; means, as of any date of
determination, the aggregate amount of Advances and undrawn or unreimbursed
Letters of Credit outstanding.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Services Company</U>&quot; means The Children&#146;s Place Services
Company, LLC, a Delaware limited liability company. </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Settlement</U>" has the meaning set forth in <U>Section 2.1(i)(i)</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Settlement Date</U>" has the meaning set forth in <U>Section 2.1(i)(i)</U>.
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Solvent</U>&quot; means, with respect to any Person on a particular
date, that on such date (a) at fair valuations, 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 salable value of the
properties and assets of such Person is not less than the amount that will 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 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 pay as such debts mature, and (e)
such Person is not engaged in business or a transaction, and is not about to
engage in business or a 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. In computing the amount of contingent liabilities at any time, it is
intended that such liabilities will be computed at the amount that, in light of
all the facts and circumstances existing at such time, represents the amount
that reasonably can be expected to become an actual or matured liability.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Subsidiary</U>&quot; of a Person means a corporation, partnership,
limited liability company, or other entity in which that Person directly or
indirectly owns or controls the shares of stock or other ownership interests
having ordinary voting power to elect a majority of the board of directors (or
appoint other comparable managers) of such corporation, partnership, limited
liability company, or other entity.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Temporary Overadvance Facility</U>&quot; means a temporary revolving
credit facility to be maintained by the Agent and Congress Financial Corporation
(New England) for the benefit of the Borrowers in an amount up to the
Overadvance Amount, as set forth in Section 2.1(b). The Temporary Overadvance
Facility shall be available to the Borrowers if, but only if, the Disney Stores
Acquisition has been consummated and all Conditions Precedent contained in
Section 3.1(c), below, have been satisfied.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Twin Brook</U>" means Twin Brook Insurance Co., Inc., a New York captive insurance company.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Voidable Transfer</U>" has the meaning set forth in <U>Section 15.8</U>.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Walt Disney Companies</U>" means TDS Franchising, LLC, a California limited
liability company; Disney Enterprises, Inc., a Delaware corporation; and Disney
Credit Card Services, Inc., a California corporation.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<U>Wells Fargo</U>" means Wells Fargo Bank, National Association.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<U>Wells Fargo Retail</U>&quot; means Wells Fargo Retail Finance, LLC, a
Delaware limited liability company.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>1.2 Accounting Terms</B>. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP. When used herein, the term
&quot;financial statements&quot; shall include the notes and schedules thereto.
Whenever the term &quot;Borrowers or Parent&quot; is used in respect of a
financial covenant or a related definition, it shall be understood to mean
Parent and its Subsidiaries on a consolidated basis unless the context clearly
requires otherwise.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>1.3 Code</B>. Any terms used in this Agreement that are defined in the Code
shall be construed and defined as set forth in the Code unless otherwise defined
herein.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>1.4 Construction</B>. Unless the context of this Agreement clearly requires
otherwise, references to the plural include the singular, references to the
singular include the plural, the term &quot;including&quot; is not limiting, and
the term &quot;or&quot; has, except where otherwise indicated, the inclusive
meaning represented by the phrase &quot;and/or.&quot; The words
&quot;hereof,&quot; &quot;herein,&quot; &quot;hereby,&quot;
&quot;hereunder,&quot; and similar terms in this Agreement refer to this
Agreement as a whole and not to any particular provision of this Agreement. An
Event of Default shall &quot;continue&quot; or be &quot;continuing&quot; until
such Event of Default has been waived in writing by the requisite members of the
Lender Group. Any reference herein to the repayment in full of the Obligations
shall mean the repayment in full in cash of all Obligations other than
contingent indemnification Obligations and other than any Bank Product
Obligations that, at such time, are allowed by the applicable Bank Product
Provider to remain outstanding and are not required to be repaid or cash
collateralized pursuant to the provisions of this Agreement. Section,
subsection, clause, schedule, and exhibit references are to this Agreement
unless otherwise specified. Any reference in this Agreement or in the Loan
Documents to this Agreement or any of the Loan Documents shall include all
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, and supplements, thereto and thereof, as
applicable.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>1.5 Schedules and Exhibits</B>. All of the schedules and exhibits attached
to this Agreement shall be deemed incorporated herein by reference.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2. LOAN AND TERMS OF PAYMENT</B>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.1 Revolving Advances.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) <U>Amounts</U>. Subject to the terms and conditions of this Agreement, each
Lender agrees to make advances ("Advances") to Borrowers in an amount at any one
time outstanding not to exceed such Lender's Pro Rata Share of an amount equal
to the lesser of (i) the Maximum Amount less the aggregate amount of all undrawn
or unreimbursed Letters of Credit, or (ii) the Borrowing Base less the aggregate
amount of all undrawn or unreimbursed Letters of Credit. For purposes of this
Agreement, "Borrowing Base", as of any date of determination, shall mean the
result of:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) 90% of Eligible Accounts, <U>plus</U></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) 30% of the retail value of Borrowers' Eligible Inventory, not to exceed 90%
of the NRLV of Borrowers' gross Inventory for months other than June through
November of each year and 95% of the NRLV of Borrowers' gross Inventory for the
months of June through November of each year; <U>plus</U></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) an amount equal to 70% of the Borrowers' cost of Inventory to be acquired
pursuant to outstanding commercial Letters of Credit (except that inventory
acquired by Letters of Credit for Children's Place Canada shall not be included
in this Section). Such Letters of Credit must not allow partial draws unless
such draws are for finished goods Inventory concurrently transferred to a
Borrower, and draws thereunder must require documentation reflecting the
transfer of title to such Borrower (in form and substance satisfactory to Agent)
of first quality finished goods Inventory conforming to such Borrower's contract
with the seller; <U>less</U></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) the aggregate amount of reserves, if any, established by Agent under
Sections 2.1(b), 6.14 and 10.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) <U>Temporary Overadvance</U>. Subject to the terms and conditions of this
Agreement, in addition to the Advances to be made pursuant to Section 2.1(a),
above, the Agent and Congress Financial Corporation (New England) agree to make
Advances to Borrowers in an amount at any one time outstanding not to exceed an
amount equal to the Overadvance Amount less the aggregate amount of all Advances
outstanding under the Temporary Overadvance Facility.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) The Temporary Overadvance Facility shall be in place, effective, and
available to the Borrower for the making of Advances thereunder commencing upon
the execution of this Agreement through December 31, 2004. However, on the date
of the consummation of the Disney Stores Acquisition, only Advances in an amount
not to exceed $7,500,000 shall be made thereunder in connection with, or to
provide funding for, the initial closing costs, advances, and other funding
requirements to be made as part of the closing on the Disney Stores Acquisition.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Advances under the Temporary Overadvance Facility shall be made upon
request by the Borrowers, in accordance with Section 2.1(e), below, and shall be
available in up to Four (4) equal tranches in the amount of $7,500,000.00 each.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) Advances under the Temporary Overadvance Facility shall be secured by the
Collateral and shall constitute Advances and Obligations hereunder. Interest
shall accrue on the aggregate outstanding balance of the Temporary Overadvance
Facility at the rate set forth in the Fee Letter, and shall be paid as provided
in Section 2.7, below.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) At all times that the Temporary Overadvance Facility is outstanding, the
Borrowers shall submit to the Agent by 11:00 a.m. (Boston time) on Tuesday of
each week, an updated Borrowing Base Certificate as of the close of business on
the prior Saturday.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(v) All Obligations outstanding under the Temporary Overadvance Facility shall
be paid in full in immediately available funds, without demand, notice, or
protest, on or before 5:00 p.m. (Boston time) on Friday, December 31, 2004.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c)
<U>Reserves</U>. Anything to the contrary in this <U>Section 2.1</U>
notwithstanding, Agent may (i) reduce the advance rates based upon Eligible
Accounts and Eligible Inventory without declaring an Event of Default if it
determines in its reasonable business judgment that there has occurred a
Material Adverse Change; and (ii) establish reserves against the Borrowing Base
in such amounts as Agent in its reasonable judgment (from the perspective of an
asset-based lender) shall deem necessary or appropriate, including reserves on
account of (y) sums that Borrowers are required to pay (such as taxes,
assessments, insurance premiums, or, in the case of leased assets, rents or
other amounts payable under such leases) and has failed to pay under any section
of this Agreement or any other Loan Document and (z) without duplication of the
foregoing, amounts owing by Borrowers to any Person to the extent secured by a
Lien on, or trust over, any of the Collateral, which Lien or trust, in the
reasonable determination of Agent (from the perspective of an asset-based
lender), would be likely to have a priority superior to the Liens of Agent (such
as landlord liens, ad valorem taxes, or sales taxes where given priority under
applicable law) in and to such item of the Collateral.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) <U>Revolving
Nature</U>. Amounts borrowed pursuant to this <U>Section 2.1</U> may be repaid
and, subject to the terms and conditions of this Agreement, reborrowed at any
time during the term of this Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(e) <U>Procedure for Borrowing</U>. Each Borrowing shall be made upon Administrative
Borrower's irrevocable request therefor delivered to Agent (which notice must be
received by Agent no later than 2:00 p.m. (Boston time) on the Funding Date if
such advance is for $8,000,000 or less or no later than 2:00 p.m. (Boston time)
on the Business Day immediately preceding the requested Funding Date if such
advance is for more than $8,000,000) specifying (i) the amount of the Borrowing;
and (ii) the requested Funding Date, which shall be a Business Day.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) <U>Agent's
Election</U>. Promptly after receipt of a request for a Borrowing pursuant to
<U>Section 2.1(d)</U> in excess of $8,000,000, the Agent shall elect, in its
discretion, (i) to have the terms of Section 2.1(g) apply to such requested
Borrowing, or (ii) to make an Agent Loan pursuant to the terms of Section
<U>2.1(h)</U> in the amount of the requested Borrowing. Any requested Borrowing
of $8,000,000 or less shall be made as an Agent Loan pursuant to the terms of
<U>Section 2.1(h)</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(g) <U>Making of Advances</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) In the event that the Agent shall elect to have the terms of this <U>Section
2.1(g)</U> apply to a requested Borrowing in excess of $8,000,000 as described in
<U>Section 2.1(f)</U>, then promptly after receipt of a request for a Borrowing
pursuant to Section 2.1(e), the Agent shall notify the Lenders, not later than
2:00 p.m. (Boston time) on the Business Day immediately preceding the Funding
Date applicable thereto, by telephone and promptly followed by telecopy, or
other similar form of transmission, of the requested Borrowing. Each Lender
shall make the amount of such Lender's Pro Rata Share of the requested Borrowing
available to the Agent in same day funds, to such account of the Agent as the
Agent may designate, not later than 2:00 p.m. (Boston time) on the Funding Date
applicable thereto. After the Agent's receipt of the proceeds of such Advances,
upon satisfaction of the applicable conditions precedent set forth in
<U>Sections 3.1</U> and <U>3.2</U>, the Agent shall make the proceeds of such
Advances available to Borrowers on the applicable Funding Date by transferring
same day funds equal to the proceeds of such Advances received by the Agent to
the Designated Deposit Account; <U>provided</U>, <U>however</U>, that, subject
to the provisions of <U>Section 2.1(m)</U>, the Agent shall not request any
Lender to make, and no Lender shall have the obligation to make, any Advance if
the Agent shall have received written notice from any Lender, or otherwise has
actual knowledge, that (A) one or more of the applicable conditions precedent
set forth in <U>Sections 3.1</U> or <U>3.2</U> will not be satisfied on the
requested Funding Date for the applicable Borrowing, or (B) the requested
Borrowing would exceed the Availability on such Funding Date.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Unless Agent
receives notice from a Lender on or prior to the Closing Date or, with respect
to any Borrowing after the Closing Date, at least one Business Day prior to the
date of such Borrowing, that such Lender will not make available as and when
required hereunder to Agent for the account of Borrowers the amount of that
Lender's Pro Rata Share of the Borrowing, Agent may assume that each Lender has
made or will make such amount available to Agent in immediately available funds
on the Funding Date and Agent may (but shall not be so required), in reliance
upon such assumption, make available to Borrowers on such date a corresponding
amount. If and to the extent any Lender shall not have made its full amount
available to Agent in immediately available funds and Agent in such
circumstances has made available to Borrowers such amount, that Lender shall on
the Business Day following such Funding Date make such amount available to
Agent, together with interest at the Defaulting Lenders Rate for each day during
such period. A notice from Agent submitted to any Lender with respect to amounts
owing under this subsection shall be conclusive, absent manifest error. If such
amount is paid to Agent such payment to Agent shall constitute such Lender's
Advance on the date of Borrowing for all purposes of this Agreement. If such
amount is not paid to Agent on the Business Day following the Funding Date,
Agent will notify Administrative Borrower of such failure to fund and, upon
demand by Agent, Borrowers shall pay such amount to Agent for Agent's account,
together with interest thereon for each day elapsed since the date of such
Borrowing, at a rate per annum equal to the interest rate applicable at the time
to the Advances composing such Borrowing. The failure of any Lender to make any
Advance on any Funding Date shall not relieve any other Lender of any obligation
hereunder to make an Advance on such Funding Date, but no Lender shall be
responsible for the failure of any other Lender to make the Advance to be made
by such other Lender on any Funding Date. Any Lender that fails to make any
Advance that it is required to make hereunder on any Funding Date and that has
not cured such failure by making such Advance within one Business Day after
written demand upon it by Agent to do so, shall constitute a "Defaulting Lender"
for purposes of this Agreement until such Advance is made.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) Agent shall not be obligated to transfer to a Defaulting Lender any
payments made by Borrowers to Agent for the Defaulting Lender's benefit; nor
shall a Defaulting Lender be entitled to the sharing of any payments hereunder.
Amounts payable to a Defaulting Lender shall instead be paid to or retained by
Agent. Agent may hold and, in its discretion, re-lend to Borrowers the amount of
all such payments received or retained by it for the account of such Defaulting
Lender. Solely for the purposes of voting or consenting to matters with respect
to the Loan Documents and determining Pro Rata Shares, such Defaulting Lender
shall be deemed not to be a "Lender" and such Defaulting Lender's Commitment
shall be deemed to be zero. This section shall remain effective with respect to
such Defaulting Lender until (A) the Obligations under this Agreement shall have
been declared or shall have become immediately due and payable or (B) the
requisite non-Defaulting Lenders, Agent, and Borrowers shall have waived such
Defaulting Lender's default in writing. The operation of this section shall not
be construed to increase or otherwise affect the Commitment of any
non-Defaulting Lender, or relieve or excuse the performance by Borrowers of
their duties and obligations hereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) <U>Making of Agent
Loans</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) In the event
the Agent shall elect to have the terms of this <U>Section 2.1(h)</U> apply to a
requested Borrowing in excess of $8,000,000 as described in <U>Section 2.1(f)</U> or in
the event of any requested Borrowing of $8,000,000 or less, Agent shall make an
Advance in the amount of such Borrowing (any such Advance made solely by Agent
pursuant to this <U>Section 2.1(g)</U> being referred to as an "Agent Loan" and such
Advances being referred to collectively as "Agent Loans") available to Borrowers
on the Funding Date applicable thereto by transferring same day funds to
Administrative Borrower's Designated Deposit Account. Each Agent Loan is an
Advance hereunder and shall be subject to all the terms and conditions
applicable to other Advances, except that all payments thereon shall be payable
to Agent solely for its own account (and for the account of the holder of any
participation interest with respect to such Advance). Subject to the provisions
of <U>Section 2.1(m)</U>, the Agent shall not make any Agent Loan if the Agent shall
have received written notice from any Lender, or otherwise has actual knowledge,
that (i) one or more of the applicable conditions precedent set forth in
<U>Sections 3.1</U> or <U>3.2</U> will not be satisfied on the requested Funding Date for the
applicable Borrowing, or (ii) the requested Borrowing would exceed the
Availability on such Funding Date. Agent shall not otherwise be required to
determine whether the applicable conditions precedent set forth in <U>Sections 3.1</U>
or <U>3.2</U> have been satisfied on the Funding Date applicable thereto prior to
making, in its sole discretion, any Agent Loan.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) The Agent
Loans shall be secured by the Collateral and shall constitute Advances and
Obligations hereunder, and shall bear interest at the rate applicable from time
to time to Obligations pursuant to <U>Section 2.7</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <U>Agent Advances</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Agent hereby is
authorized by Borrowers and the Lenders, from time to time in Agent's sole
discretion, (1) after the occurrence of a Default or an Event of Default (but
without constituting a waiver of such Default or Event of Default), or (2) at
any time that any of the other applicable conditions precedent set forth in
<U>Section 3.1</U> or <U>3.2</U> have not been satisfied, to make Advances to
Borrowers on behalf of the Lenders which Agent, in its reasonable business
judgment, deems necessary or desirable (A) to preserve or protect the
Collateral, or any portion thereof (other than the Bank Product Obligations),
(B) to enhance the likelihood of, or maximize the amount of, repayment of the
Obligations, or (C) to pay any other amount chargeable to Borrowers pursuant to
the terms of this Agreement, including Lender Group Expenses and the costs,
fees, and expenses described in <U>Section 10</U> (any of the Advances described
in this <U>Section 2.1(i)</U> being hereinafter referred to as "Agent
Advances"); <U>provided</U>, that Agent shall not make any Agent Advances to
Borrowers without the consent of all of the Lenders if the amount thereof would
exceed $8,000,000 in the aggregate at any one time.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Agent Advances
shall be repayable on demand and secured by the Collateral, shall constitute
Advances and Obligations hereunder, and shall bear interest at the rate
applicable from time to time to the Obligations pursuant to <U>Section 2.7</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (j) <U>Settlement</U>. It
is agreed that each Lender's funded portion of the Advances is intended by the
Lenders to be equal at all times to such Lender's Pro Rata Share of the
outstanding Advances. Such agreement notwithstanding, the Agent and the Lenders
agree (which agreement shall not be for the benefit of or enforceable by
Borrowers) that in order to facilitate the administration of this Agreement and
the other Loan Documents, settlement among them as to the Advances, the Agent
Loans, and the Agent Advances shall take place on a periodic basis in accordance
with the following provisions:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The Agent shall
request settlement ("Settlement") with the Lenders on a weekly basis, or on a
more frequent basis if so determined by the Agent, (1) for itself, with respect
to each Agent Loan and Agent Advance, and (2) with respect to Collections
received, as to each by notifying the Lenders by telephone and promptly followed
by telecopy, or other similar form of transmission, of such requested
Settlement, no later than 1:00 p.m. (Boston time) on the Business Date
immediately preceding the date of such requested Settlement (the "Settlement
Date"). Such notice of a Settlement Date shall include a summary statement of
the amount of outstanding Advances, Agent Loans, and Agent Advances for the
period since the prior Settlement Date, the amount of repayments received in
such period, and the amounts allocated to each Lender of the principal,
interest, fees, and other charges for such period. Subject to the terms and
conditions contained herein: (y) if a Lender's balance of the Advances, Agent
Loans, and Agent Advances exceeds such Lender's Pro Rata Share of the Advances,
Agent Loans, and Agent Advances as of a Settlement Date, then Agent shall by no
later than 1:00 p.m. (Boston time) on the Settlement Date transfer in same day
funds to the account of such Lender as Lender may designate, an amount such that
each such Lender shall, upon receipt of such amount, have as of the Settlement
Date, its Pro Rata Share of the Advances, Agent Loans, and Agent Advances; and
(z) if a Lender's balance of the Advances, Agent Loans, and Agent Advances is
less than such Lender's Pro Rata Share of the Advances, Agent Loans, and Agent
Advances as of a Settlement Date, such Lender shall no later than 1:00 p.m.
(Boston time) on the Settlement Date transfer in same day funds to such account
of the Agent as the Agent may designate, an amount such that each such Lender
shall, upon transfer of such amount, have as of the Settlement Date, its Pro
Rata Share of the Advances, Agent Loans, and Agent Advances. Such amounts made
available to the Agent under clause (z) of the immediately preceding sentence
shall be applied against the amounts of the applicable Agent Loan or Agent
Advance and, together with the portion of such Agent Loan or Agent Advance
representing each Lender's Pro Rata Share thereof, shall constitute Advances of
such Lenders. If any such amount is not made available to the Agent by any
Lender on the Settlement Date applicable thereto to the extent required by the
terms hereof, the Agent shall be entitled to recover for its account such amount
on demand from such Lender together with interest thereon at the Defaulting
Lenders Rate.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) In determining
whether a Lender's balance of the Advances, Agent Loans, and Agent Advances is
less than, equal to, or greater than such Lender's Pro Rata Share of the
Advances, Agent Loans, and Agent Advances as of a Settlement Date, Agent shall,
as part of the relevant Settlement, apply to such balance the portion of
payments actually received by Agent with respect to principal, interest, fees
payable by Borrowers and allocable to the Lenders hereunder, and proceeds of
Collateral. To the extent that a net amount is owed to any such Lender after
such application, such net amount shall be distributed by Agent to that Lender
as part of such Settlement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Between
Settlement Dates, the Agent, to the extent no Agent Advances or Agent Loans are
outstanding, may pay over to Lenders any payments received by the Agent, which
in accordance with the terms of the Agreement would be applied to the reduction
of the Advances, for application to Lenders' Pro Rata Share of the Advances. If,
as of any Settlement Date, Collections received since the then immediately
preceding Settlement Date have been applied to Lenders' Pro Rata Share of the
Advances other than to Agent Loans or Agent Advances, as provided for in the
previous sentence, Lenders shall pay to the Agent for the accounts of the
Lenders, and Agent shall pay to the Lenders, to be applied to the outstanding
Advances of such Lenders, an amount such that each Lender shall, upon receipt of
such amount, have, as of such Settlement Date, its Pro Rata Share of the
Advances. During the period between Settlement Dates, the Agent with respect to
Agent Loans and Agent Advances, and each Lender with respect to the Advances
other than Agent Loans and Agent Advances, shall be entitled to interest at the
applicable rate or rates payable under this Agreement on the daily amount of
funds employed by the Agent or the Lenders, as applicable.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (k) <U>Notation</U>. The
Agent shall record on its books the principal amount of the Advances owing to
each Lender, including the Agent Loans and Agent Advances owing to the Agent,
and the interests therein of each Lender, from time to time. In addition, each
Lender is authorized, at such Lender's option, to note the date and amount of
each payment or prepayment of principal of such Lender's Advances in its books
and records, including computer records, such books and records constituting
rebuttably presumptive evidence, absent manifest error, of the accuracy of the
information contained therein.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (l) <U>Lenders'
Failure to Perform</U>. All Advances (other than Agent Loans and Agent Advances)
shall be made by the Lenders simultaneously and in accordance with their Pro
Rata Shares. It is understood that (i) no Lender shall be responsible for any
failure by any other Lender to perform its obligation to make any Advances
hereunder, nor shall any Commitment of any Lender be increased or decreased as a
result of any failure by any other Lender to perform its obligation to make any
Advances hereunder, and (ii) no failure by any Lender to perform its obligation
to make any Advances hereunder shall excuse any other Lender from its obligation
to make any Advances hereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (m) <U>Overadvances</U>.
In addition to any Agent Advances which may be made in accordance with Section
2.1(i), above, the Agent may make voluntary Overadvances without the written
consent of the Required Lenders for amounts charged to the applicable Loan
Account for interest, fees or Lender Group Expenses pursuant to Section
2.1(i)(i)(2)(C). If the conditions for borrowing under Section 3.2(d) cannot be
fulfilled, the Agent may, but is not obligated to, knowingly and intentionally
continue to make Advances (without limiting the ability of the Agent to make
Agent Loans) to Borrowers, such failure of condition notwithstanding, so long
as, at any time, (i) the outstanding Revolving Facility Usage would not exceed
the Borrowing Base for more than 60 consecutive days or more than once in any
180 day period, and the maximum outstanding overadvance amount shall not exceed
$2,000,000, without the consent of all of the Lenders, and (ii) the outstanding
Revolving Facility Usage (except for and excluding amounts charged to the
applicable Loan Account for interest, fees, or Lender Group Expenses) does not
exceed the Maximum Amount. The foregoing provisions are for the sole and
exclusive benefit of the Agent and the Lenders and are not intended to benefit
Borrowers in any way. The Advances that are made pursuant to this Section 2.1(m)
shall be subject to the same terms and conditions as any other Agent Advance or
Agent Loan, as applicable, except that the rate of interest applicable thereto
shall be the rates set forth in Section 2.7(c)(i) without regard to the presence
or absence of a Default or Event of Default.</FONT></P>

<P><FONT SIZE=3>Each Lender shall be obligated to settle with Agent as provided
in <U>Section&#160;2.1(j)</U> for the amount of such Lender's Pro Rata Share of
any Overadvances made as permitted under this <U>Section&#160;2.1(m)</U>.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (n) <U>Effect of
Bankruptcy</U>. If a case is commenced by or against any Borrower under the
Bankruptcy Code, or other statute providing for debtor relief, then, without the
approval of Required Lenders the Lender Group shall not make additional loans or
provide additional financial accommodations under the Loan Documents to such
Borrower as debtor or debtor-in-possession, or to any trustee for such Borrower,
nor consent to the use of cash collateral (provided that the applicable Loan
Account shall continue to be charged, to the fullest extent permitted by law,
for accruing interest, fees, and Lender Group Expenses).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.2 Letters of Credit</B>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Agreement to
Cause Issuance; Amounts; Outside Expiration Date</U>. Subject to the terms and
conditions of this Agreement, Agent agrees to issue letters of credit for the
account of Parent or Services Company (each, an "L/C") or to issue guarantees of
payment (each such guaranty, an "L/C Guaranty") with respect to letters of
credit issued by an issuing bank for the account of Parent or Services Company;
<U>provided</U>, <U>however</U>, Parent or Services Company shall have the right to cause
Letters of Credit for the purchase of inventory by Children's Place Canada. For
purposes of clarification, the inventory referred to herein is not part of
Inventory as that term is defined in this Agreement. Agent shall have no
obligation to issue a Letter of Credit if any of the following would result:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The aggregate
amount of:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(A) all undrawn and unreimbursed Letters of Credit would exceed $100,000,000,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(B) all undrawn and unreimbursed domestic Letters of Credit would exceed
$100,000,000; or</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(C) all undrawn and unreimbursed Canadian Letters of Credit would exceed
$10,000,000; or</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) 100% of the aggregate amount of all undrawn and unreimbursed Letters of
Credit, would exceed the Borrowing Base less the amount of outstanding Advances
(including any Agent Advances and Agent Loans); or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) the aggregate amount of all undrawn or unreimbursed Letters of Credit
would exceed the lower of: (x) the Maximum Amount less the amount of outstanding
Advances (including any Agent Advances and Agent Loans); or (y) $130,000,000 or
up to $160,000,000 in accordance with <U>Section 2.1(b)</U> relating to the Temporary
Overadvance Facility.</FONT></P>

<P><FONT SIZE=3>Borrowers expressly understand and agree that Agent shall have
no obligation to arrange for the issuance by issuing banks of the letters of
credit that are to be the subject of L/C Guarantees. Borrowers and the Lender
Group acknowledge and agree that certain of the letters of credit that are to be
the subject of L/C Guarantees may be on the Closing Date. Each Letter of Credit
shall have an expiry date no later than the date on which this Agreement is
scheduled to terminate under
<U>Section&#160;3.4</U> (without regard to any potential renewal term) and all
such Letters of Credit shall be in form and substance acceptable to Agent in its
sole discretion. If the Lender Group is obligated to advance funds under a
Letter of Credit, Borrowers immediately shall reimburse such amount to Agent
and, in the absence of such reimbursement, the amount so advanced immediately
and automatically shall be deemed to be an Advance hereunder and, thereafter,
shall bear interest at the rate then applicable to Advances under
<U>Section&#160;2.7</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) <U>Indemnification</U>. Each Borrower hereby agrees to indemnify, save, defend, and
hold the Lender Group harmless from any loss, cost, expense, or liability,
including payments made by the Lender Group, expenses, and reasonable attorneys
fees incurred by the Lender Group arising out of or in connection with any
Letter of Credit. Each Borrower agrees to be bound by the issuing bank's
regulations and interpretations of any letters of credit guarantied by the
Lender Group and opened to or for Parent's or Service Company's account or by
Agent's interpretations of any Letter of Credit issued by Agent to or for any
Borrower's account, even though this interpretation may be different from such
Borrower's own, and such Borrower understands and agrees that the Lender Group
shall not be liable for any error, negligence, or mistake, whether of omission
or commission, in following such Borrower's instructions or those contained in
the Letter of Credit or any modifications, amendments, or supplements thereto.
Each Borrower understands that the L/C Guarantees may require the Lender Group
to indemnify the issuing bank for certain costs or liabilities arising out of
claims by Borrowers against such issuing bank. Each Borrower hereby agrees to
indemnify, save, defend, and hold the Lender Group harmless with respect to any
loss, cost, expense (including reasonable attorneys fees), or liability incurred
by the Lender Group under any L/C Guaranty as a result of the Lender Group's
indemnification of any such issuing bank.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Supporting
Materials</U>. Borrowers hereby authorize and direct any bank that issues a letter
of credit guaranteed by an L/C Guaranty to deliver to Agent all instruments,
documents, and other writings and property received by the issuing bank pursuant
to such letter of credit, and to accept and rely upon Agent's instructions and
agreements with respect to all matters arising in connection with such letter of
credit and the related application. A Borrower may or may not be the "applicant"
or "account party" with respect to such letter of credit.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) <U>Costs of
Letters of Credit</U>. Notwithstanding anything to the contrary contained in
this Agreement, Borrowers shall not be responsible for any and all charges,
commissions, fees (other than the Letter of Credit fee set forth in <U>Section
2.7(b)</U>), and costs relating to any L/C or to the letters of credit
guaranteed by an L/C Guaranty.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e)
<U>Indemnification</U>. Immediately upon the termination of this Agreement, Borrowers
agree to either (i) provide cash collateral to be held by Agent in an amount
equal to 105% of the maximum amount of the Lender Group's obligations under
outstanding Letters of Credit, or (ii) cause to be delivered to Agent releases
of all of the Lender Group's obligations under outstanding Letters of Credit. At
Agent's discretion, any proceeds of Collateral received by Agent after the
occurrence and during the continuation of an Event of Default may be held as the
cash collateral required by this <U>Section 2.2(e)</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) <U>Increased
Costs</U>. If by reason of (i) any change in any applicable law, treaty, rule, or
regulation or any change in the interpretation or application by any
governmental authority of any such applicable law, treaty, rule, or regulation,
or (ii) compliance by the issuing bank or the Lender Group with any direction,
request, or requirement (irrespective of whether having the force of law) of any
governmental authority or monetary authority including, without limitation,
Regulation D of the Board of Governors of the Federal Reserve System as from
time to time in effect (and any successor thereto):</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) any reserve,
deposit, or similar requirement is or shall be imposed or modified in respect of
any Letters of Credit issued hereunder, or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) there shall be
imposed on the issuing bank or the Lender Group any other condition regarding
any letter of credit, or Letter of Credit, as applicable, issued pursuant
hereto;</FONT></P>

<P><FONT SIZE=3>and the result of the foregoing is to increase, directly or
indirectly, the cost to the issuing bank or the Lender Group of issuing, making,
guaranteeing, or maintaining any letter of credit, or Letter of Credit, as
applicable, or to reduce the amount receivable in respect thereof by such
issuing bank or the Lender Group, then, and in any such case, Agent may, at any
time within a reasonable period after the additional cost is incurred or the
amount received is reduced, notify Administrative Borrower, and Borrowers shall
pay on demand such amounts as the issuing bank or Agent may specify to be
necessary to compensate the issuing bank or Agent for such additional cost or
reduced receipt, together with interest on such amount from the date of such
demand until payment in full thereof at the rate set forth in <U>Section
2.7(a)</U> or <U>(c)(i)</U>, as applicable. The determination by the issuing
bank or Agent, as the case may be, of any amount due pursuant to this
<U>Section&#160;2.2(f)</U>, as set forth in a certificate setting forth the
calculation thereof in reasonable detail, shall, in the absence of manifest or
demonstrable error, be final and conclusive and binding on all of the parties
hereto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(g) <U>Participations</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) <U>Purchase of
Participations</U>. Immediately upon issuance of any Letter of Credit in
accordance with this <U>Section 2.2</U>, each Lender shall be deemed to have
irrevocably and unconditionally purchased and received without recourse or
warranty, an undivided interest and participation in the credit support or
enhancement provided through the Agent to such issuer in connection with the
issuance of such Letter of Credit, equal to such Lender's Pro Rata Share of the
face amount of such Letter of Credit (including, without limitation, all
obligations of Borrowers with respect thereto, and any security therefor or
guaranty pertaining thereto).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) <U>Documentation</U>.
Upon the request of any Lender, the Agent shall furnish to such Lender copies of
any Letter of Credit, reimbursement agreements executed in connection therewith,
application for any Letter of Credit and credit support or enhancement provided
through the Agent in connection with the issuance of any Letter of Credit, and
such other documentation as may reasonably by requested by such Lender.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) <U>Obligations
Irrevocable</U>. The obligations of each Lender to make payments to the Agent with
respect to any Letter of Credit or with respect to any credit support or
enhancement provided through the Agent with respect to a Letter of Credit, and
the obligations of Borrowers to make payments to the Agent, for the account of
the Lenders, shall be irrevocable, not subject to any qualification or exception
whatsoever, including, without limitation, any of the following circumstances:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(A) any lack of validity or enforceability of this Agreement or any of the other
Loan Documents;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(B) the existence of any claim, setoff, defense, or other right which any
Borrower may have at any time against a beneficiary named in a Letter of Credit
or any transferee of any Letter of Credit (or any Person for whom any such
transferee may be acting), any Lender, the Agent, the issuer of such Letter of
Credit, 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 transactions between such Borrower or any
other Person and the beneficiary named in any Letter of Credit);</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(C) any draft, certificate, or any other document presented under the 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;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(D) the surrender or impairment of any security for the performance or
observance of any of the terms of any of the Loan Documents; or</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(E) the occurrence of any Default or Event of Default.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.3 Intentionally Omitted.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.4 Intentionally Omitted.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.5 Payments.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) <B>Payments by Borrowers.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) All payments to be made by Borrowers shall be made without set-off,
recoupment, deduction, or counterclaim, except as otherwise required by law.
Except as otherwise expressly provided herein, all payments by Borrowers shall
be made to Agent for the account of the Lenders or Agent, as the case may be, at
Agent's address set forth in <U>Section 12</U>, and shall be made in immediately
available funds, no later than 2:00 p.m. (Boston time) on the date specified
herein. Any payment received by Agent later than 2:00 p.m. (Boston time), at the
option of Agent, shall be deemed to have been received on the following Business
Day and any applicable interest or fee shall continue to accrue until such
following Business Day.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Whenever any
payment is due on a day other than a Business Day, such payment shall be made on
the following Business Day, and such extension of time shall in such case be
included in the computation of interest or fees, as the case may be.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Unless Agent
receives notice from Borrowers prior to the date on which any payment is due to
the Lenders that Borrowers will not make such payment in full as and when
required, Agent may assume that Borrowers have made such payment in full to
Agent on such date in immediately available funds and Agent may (but shall not
be so required), in reliance upon such assumption, distribute to each Lender on
such due date an amount equal to the amount then due such Lender. If and to the
extent Borrowers have not made such payment in full to Agent, each Lender shall
repay to Agent on demand such amount distributed to such Lender, together with
interest thereon at the Reference Rate for each day from the date such amount is
distributed to such Lender until the date repaid.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <B>Apportionment
and Application.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Except as
otherwise provided with respect to Defaulting Lenders and except as otherwise
provided in the Loan Documents (including letter agreements between Agent and
individual Lenders), aggregate principal and interest payments shall be
apportioned ratably among the Lenders (according to the unpaid principal balance
of the Obligations to which such payments relate held by each Lender) and
payments of fees and expenses (other than fees or expenses that are for Agent's
separate account, after giving effect to any letter agreements between Agent and
individual Lenders) shall be apportioned ratably among the Lenders having a Pro
Rata Share of the type of Commitment or Obligation to which a particular fee
relates. All payments shall be remitted to Agent and all such payments, and all
proceeds of Collateral received by Agent, shall be applied as follows:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A. <U>first</U>, to pay any Lender Group Expenses then due to Agent under the Loan
Documents, until paid in full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
B. <U>second</U>, to pay any Lender Group Expenses then due to the Lenders under the
Loan Documents, on a ratable basis, until paid in full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
C. <U>third</U>, to pay any fees then due to Agent (for its separate accounts, after
giving effect to any letter agreements between Agent and the individual Lenders)
under the Loan Documents until paid in full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
D. <U>fourth</U>, to pay any fees then due to any or all of the Lenders (after giving
effect to any letter agreements between Agent and individual Lenders) under the
Loan Documents, on a ratable basis, until paid in full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
E. <U>fifth</U>, to pay interest due in respect of all Agent Advances, until paid in
full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
F. <U>sixth</U>, ratably to pay interest due in respect of the Advances (other than
Agent Advances) until paid in full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
G. <U>seventh</U>, to pay the principal of all Agent Advances until paid in full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
H. <U>eighth</U>, so long as no Event of Default has occurred and is continuing, to pay
(i) first, the entire principal of all Advances under the Temporary Overadvance
Facility (or, if less, the portion of the Temporary Overadvance Facility that is
then required to be repaid hereunder), but only, and to the extent that, after
giving effect to the payment, Availability (other than with respect to the
Temporary Overadvance Facility)is greater than $25,000,000.00, and then, the
principal of all Advances (other than Advances made under the Temporary
Overadvance Facility) until paid in full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
I. <U>ninth</U>, so long as no Event of Default has occurred and is continuing, and at
Agent&#146;s election (which election Agent agrees will not be made if an
Overadvance would be created thereby), to pay amounts then due and owing by
Administrative Borrower or its Subsidiaries in respect of Bank Products, until
paid in full,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
J. <U>tenth</U>, if an Event of Default has occurred and is continuing,
<U>first,</U>
to pay the principal of all Advances until paid in full, <U>second</U>, to
Agent, to be held by Agent, for the ratable benefit of those Lenders having a
Commitment, as cash collateral in an amount up to 105% of the then extant
Letters of Credit until paid in full, <U>third</U>, to pay the principal of all
Advances under the Temporary Overadvance Facility, and <U>fourth</U>, to Agent,
to be held by Agent, for the benefit of the Bank Product Providers, as cash
collateral in an amount up to the amount of the Bank Product Reserve established
prior to the occurrence of, and not in contemplation of, the subject Event of
Default until Administrative Borrower&#146;s and its Subsidiaries&#146;
obligations in respect of the then outstanding Bank Products have been paid in
full or the cash collateral amount has been exhausted,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
K. <U>eleventh</U>, if an Event of Default has occurred and is continuing, to pay any
other Obligations (including the provision of amounts to Agent, to be held by
Agent, for the benefit of the Bank Product Providers, as cash collateral in an
amount up to the amount determined by Agent in its discretion as the amount
necessary to secure Administrative Borrower&#146;s and its Subsidiaries&#146;
obligations in respect of the then outstanding Bank Products), and</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
L. <U>twelfth</U>, to Borrowers (to be wired to the Designated Account) or such other
Person entitled thereto under applicable law.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Agent promptly shall distribute to each Lender, pursuant to the applicable
wire instructions received from each Lender in writing, such funds as it may be
entitled to receive, subject to a Settlement delay as provided in <U>Section
2.1(i)</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) In each instance, so long as no Event of Default has occurred and is
continuing, this <U>Section 2.5(b)</U> shall not be deemed to apply to any payment by
Borrowers specified by Borrowers to be for the payment of specific Obligations
then due and payable (or prepayable) under any provision of this Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) For purposes
of the foregoing, "paid in full" means payment of all amounts owing under the
Loan Documents according to the terms thereof, including loan fees, service
fees, professional fees, interest (and specifically including interest accrued
after the commencement of any Insolvency Proceeding), default interest, interest
on interest, and expense reimbursements, whether or not any of the foregoing
would be or is allowed or disallowed in whole or in part in any Insolvency
Proceeding.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (v) In the event of
a direct conflict between the priority provisions of this <U>Section 2.5</U> and other
provisions contained in any other Loan Document, it is the intention of the
parties hereto that such priority provisions in such documents shall be read
together and construed, to the fullest extent possible, to be in concert with
each other. In the event of any actual, irreconcilable conflict that cannot be
resolved as aforesaid, the terms and provisions of this <U>Section 2.5</U> shall
control and govern.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.6 Overadvances.</B> If, at any time or for any reason, the amount of
Obligations owed by Borrowers to the Lender Group pursuant to <U>Sections
2.1</U> and <U>2.2</U> is greater than either the Dollar or percentage
limitations set forth in <U>Sections 2.1</U> and <U>2.2</U> (an
&quot;Overadvance&quot;), Borrowers immediately shall pay to Agent, in cash, the
amount of such excess to be used by Agent to reduce the Obligations pursuant to
the terms of <U>Section 2.5(b)</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.7 Interest and Letter of Credit Fees: Rates, Payments, and Calculations.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) <U>Interest Rate</U>. Except as provided in <U>Section 2.1(b)(iii)</U> or in <U>Section
2.7(c)</U>, below, all Obligations shall bear interest on the Daily Balance as
follows:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) each LIBOR Rate
Loan shall bear interest at a per annum rate equal to the Adjusted LIBOR Rate
plus the LIBOR Rate Margin; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) all other
Obligations (except for undrawn Letters of Credit) shall bear interest at a per
annum rate equal to the Reference Rate.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Letter of
Credit Fee</U>. Borrowers shall pay Agent, for the benefit of the Lender Group, a
fee equal to 0.75% per annum times the aggregate undrawn amount of all Letters
of Credit outstanding as of the end of the day.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Default
Rate</U>. Upon the occurrence and during the continuation of an Event of
Default, (i) all Obligations (except for undrawn Letters of Credit) shall bear
interest on the Daily Balance at a per annum rate equal to 3.00% above the
Reference Rate, and (ii) the Letter of Credit fee provided in <U>Section
2.6(b)</U> shall be increased to 3.75% per annum times the aggregate undrawn
amount of all outstanding Letters of Credit; <U>provided</U>, <U>however</U>,
the foregoing adjustments are subject to waiver by the Required
Lenders.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) <U>Intentionally
Omitted</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) <U>Payments</U>.
Interest in respect of Reference Rate Loans and Letter of Credit fees payable
hereunder shall be due and payable, in arrears, on the first day of each month
during the term hereof. Interest in respect of each LIBOR Rate Loan shall be due
and payable, in arrears, on (i) the last day of the applicable Interest Period,
and (ii) the first day of each month occurring during the term thereof. Each
Borrower hereby authorizes Agent, at its option, without prior notice to such
Borrower, to charge such interest and Letter of Credit fees, the fees and
charges provided for in <U>Section 2.12</U> (as and when accrued or incurred), and all
installments or other payments due under any Loan Document (including the
amounts due and payable to the Bank Product Providers in respect to Bank
Products up to the amount of the Bank Product Reserve) to Administrative
Borrower's Loan Account, which amounts thereafter shall accrue interest at the
rate then applicable to Advances hereunder. Any interest not paid when due shall
be compounded and shall thereafter accrue interest at the rate then applicable
to Advances hereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) <U>Computation</U>. In
the event the Reference Rate is changed from time to time hereafter, the
applicable rate of interest hereunder automatically and immediately shall be
increased or decreased by an amount equal to such change in the Reference Rate.
All interest and fees chargeable under the Loan Documents shall be computed on
the basis of a 360 day year for the actual number of days elapsed.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) <U>Intent to Limit
Charges to Maximum Lawful Rate</U>. In no event shall the interest rate or rates
payable under this Agreement, plus any other amounts paid in connection
herewith, exceed the highest rate permissible under any law that a court of
competent jurisdiction shall, in a final determination, deem applicable.
Borrowers and the Lender Group, in executing and delivering this Agreement,
intend legally to agree upon the rate or rates of interest and manner of payment
stated within it; <U>provided</U>, <U>however</U>, that, anything contained herein to the
contrary notwithstanding, if said rate or rates of interest or manner of payment
exceeds the maximum allowable under applicable law, then, ipso facto as of the
date of this Agreement, Borrowers are and shall be liable only for the payment
of such maximum as allowed by law, and payment received from Borrowers in excess
of such legal maximum, whenever received, shall be applied to reduce the
principal balance of the Obligations to the extent of such excess.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.8 Collection of Accounts.</B> Borrower shall at all times maintain
lockboxes (the &quot;Lockboxes&quot;) and, immediately after the Closing Date,
shall instruct all Account Debtors with respect to the Accounts, General
Intangibles, and Negotiable Collateral of Borrower to remit all Collections in
respect thereof to such Lockboxes. Borrower, Agent, and the Lockbox Banks shall
enter into the Lockbox Agreements, which among other things shall provide for
the opening of a Lockbox Account for the deposit of Collections at a Lockbox
Bank. Borrower agrees that all Collections and other amounts received by
Borrower from any Account Debtor or any other source immediately upon receipt
shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement
contemplated thereby shall be modified by Borrower without the prior written
consent of Agent. Upon the terms and subject to the conditions set forth in the
Lockbox Agreements, all amounts received in each Lockbox Account shall be wired
each Business Day into an account (the &quot;Agent's Account&quot;) maintained
by Agent at a depositary selected by Agent (except as provided in the last
sentence of Section 2.9). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.9 Crediting Payments; Application of Collections.</B> The receipt of any
Collections by Agent (whether from transfers to Agent by the Lockbox Banks
pursuant to the Lockbox Agreements or otherwise) immediately shall be applied
provisionally to reduce the Obligations outstanding under <U>Section 2.1</U>,
but shall not be considered a payment on account unless such Collection item is
a wire transfer of immediately available federal funds and is made to the
Agent's Account or unless and until such Collection item is honored when
presented for payment. Should any Collection item not be honored when presented
for payment, then Borrowers shall be deemed not to have made such payment, and
interest shall be recalculated accordingly. Anything to the contrary contained
herein notwithstanding, any Collection item shall be deemed received by Agent
only if it is received into the Agent's Account on a Business Day on or before
11:00 a.m. Boston time. If any Collection item is received into the Agent's
Account on a non-Business Day or after 11:00 a.m. Boston time on a Business Day,
it shall be deemed to have been received by Agent as of the opening of business
on the immediately following Business Day. Prior to the occurrence of an Event
of Default or Agent reasonably deeming itself insecure, and so long as
Availability is $25,000,000 or more, at Administrative Borrower&#146;s option,
monies shall be transferred from the Lock Box to Agent or to Administrative
Borrower's account on a daily basis, and if transferred to Administrative
Borrower's account such monies will not be applied to the
Obligations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.10 Designated Account.</B> Agent and the Lender Group are authorized to
make the Advances and the Letters of Credit under this Agreement based upon
telephonic or other instructions received from anyone purporting to be an
Authorized Person, or without instructions if pursuant to
<U>Section 2.7(e)</U>. Administrative Borrower agrees to establish and maintain
the Designated Account with the Designated Account Bank for the purpose of
receiving the proceeds of the Advances requested by Administrative Borrower and
made by the Lender Group hereunder. Unless otherwise agreed by Agent and
Administrative Borrower, any Advance requested by Borrowers and made by the
Lender Group hereunder shall be made to the Designated Account.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.11 Maintenance of Loan Account; Statements of Obligations.</B> Agent shall
maintain an account on its books in the name of Borrowers (the &quot;Loan
Account&quot;) on which Borrowers will be charged with all Advances made by the
Lender Group to Borrowers or for Borrowers' account, including, accrued
interest, Lender Group Expenses, and any other payment Obligations of Borrowers.
In accordance with
<U>Section 2.9</U>, the Loan Account will be credited with all payments received
by Agent from Borrowers or for Borrowers' account, including all amounts
received in the Agent's Account from any Lockbox Bank. Agent shall render
statements regarding the Loan Account to Administrative Borrower, including
principal, interest, fees, and including an itemization of all charges and
expenses constituting the Lender Group Expenses owing, and such statements shall
be conclusively presumed to be correct and accurate and constitute an account
stated between Administrative Borrower and the Lender Group unless, within 30
days after receipt thereof by Administrative Borrower, Borrower shall deliver to
Agent written objection thereto describing the error or errors contained in any
such statements.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.12 Fees.</B> Borrowers shall pay to Agent for the ratable benefit of the
Lender Group (except where otherwise indicated) the following fees:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) <U>Increased Commitment Closing Fee</U>. In the amount and as provided in the Fee
Letter.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Temporary
Overadvance Facility Commitment Fee</U>. In the amount and as provided in the Fee
Letter.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Temporary
Overadvance Facility Closing Fee</U>. In the amount and as provided in the Fee
Letter.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) <U>Anniversary
Fee</U>. An anniversary fee equal to 0.125% of the Maximum Amount, which fee shall
be due and payable in full on each October 31, commencing October 31 2005
through and including October 31, 2007; provided, however, the Agreement has not
previously been terminated.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) <U>Unused Line
Fee</U>. On the first day of each month commencing November 1, 2004, whenever the
average Daily Balance of Obligations is less than the Maximum Amount then in
effect, an unused line fee in an amount equal to 0.375% per annum times the
Average Unused Portion of the Maximum Amount.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) <U>Servicing Fee</U>.
On the first day of each month during the term of this Agreement, and thereafter
so long as any Obligations are outstanding, a servicing fee solely for the Agent
in an amount equal to $2,000.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) <U>Appraisals;
Financial Examination and Appraisal Fees</U>. The Agent or its designee, at the sole
expense of Borrowers, shall conduct periodic appraisals of Borrower's Inventory.
So long as no Event of Default has occurred and is continuing, Borrowers shall
not be liable to pay more than $60,000 per year (exclusive of out of pocket
expenses) for financial analyses and examinations and periodic appraisals of
Inventory in the aggregate.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <B>2.13 LIBOR
Rate Loans.</B>  Any other provisions herein to the contrary notwithstanding, the
following provisions shall govern with respect to LIBOR Rate Loans as to the
matters covered:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) <U>Borrowing; Conversion; Continuation</U>. Administrative Borrower may from time
to time, on or after the Closing Date (and subject to the satisfaction of the
requirements of <U>Sections 3.1 and 3.2)</U>, request in a written or telephonic
communication with Agent: (i) Advances to constitute LIBOR Rate Loans; (ii) that
Reference Rate Loans be converted into LIBOR Rate Loans; or (iii) that existing
LIBOR Rate Loans continue for an additional Interest Period. Any such request
shall specify the aggregate amount of the requested LIBOR Rate Loans, the
proposed funding date therefor (which shall be a Business Day, and with respect
to continued LIBOR Rate Loans shall be the last day of the Interest Period of
the existing LIBOR Rate Loans being continued), and the proposed Interest Period
(in each case subject to the limitations set forth below). LIBOR Rate Loans may
only be made, continued, or extended if, as of the proposed funding date
therefor, each of the following conditions is satisfied:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(v) no Event of Default exists;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(w) no more than five Interest Periods may be in effect at any one time;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(x) the amount of each LIBOR Rate Loan borrowed, converted, or continued must be
in an amount not less than $5,000,000 and integral multiples of $1,000,000 in
excess thereof;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(y) Agent shall have determined that the Interest Period or Adjusted LIBOR Rate
is available to it and can be readily determined as of the date of the request
for such LIBOR Rate Loan by Borrowers; and</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(z) Agent shall have received such request at least two Business Days prior to
the proposed funding date therefor.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>
Any request by Administrative Borrower to borrow LIBOR Rate Loans, to convert
Reference Rate Loans to LIBOR Rate Loans, or to continue any existing LIBOR Rate
Loans shall be irrevocable, except to the extent that any Lender shall determine
under <U>Sections&#160;2.13(a), 2.14 or 2.15</U> that such LIBOR Rate Loans cannot be
made or continued.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) <U>Determination of Interest Period</U>. By giving notice as set forth in
<U>Section 2.12(a)</U>, Borrowers shall select an Interest Period for such LIBOR Rate
Loan. The determination of the Interest Period shall be subject to the following
provisions:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) in the case of immediately successive Interest Periods, each successive
Interest Period shall commence on the day on which the next preceding Interest
Period expires;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) if any
Interest Period would otherwise expire on a day which is not a Business Day, the
Interest Period shall be extended to expire on the next succeeding Business Day;
<U>provided</U>, <U>however</U>, that if the next succeeding Business Day occurs in the
following calendar month, then such Interest Period shall expire on the
immediately preceding Business Day;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) if any
Interest Period begins on the last Business Day of a month, or on a day for
which there is no numerically corresponding day in the calendar month at the end
of such Interest Period, then the Interest Period shall end on the last Business
Day of the calendar month at the end of such Interest Period; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) Administrative
Borrower may not select an Interest Period which expires later than the date on
which this Agreement is scheduled to terminate pursuant to <U>Section 3.4</U> hereof.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Automatic
Conversion: Optional Conversion by Agent</U>. Any LIBOR Rate Loan shall
automatically convert to a Reference Rate Loan upon the last day of the
applicable Interest Period, unless Agent has received a request to continue such
LIBOR Rate Loan at least two Business Days prior to the end of such Interest
Period in accordance with the terms of <U>Section 2.13(a)</U>. Any LIBOR Rate Loan
shall, at Agent's option, upon notice to Borrower, immediately convert to a
Reference Rate Loan in the event that (i) an Event of Default shall have
occurred and be continuing or (ii) this Agreement shall terminate, and Borrowers
shall pay to Agent, for the benefit of the Lenders, any amounts required by
<U>Section 2.16</U> as a result thereof.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.14 Illegality.</B> Any other provision herein to the contrary
notwithstanding, if the adoption of or any change in any Requirement of Law or
in the interpretation or application thereof by a Governmental Authority made
subsequent to the Closing Date shall make it unlawful for any Lender to make or
maintain LIBOR Rate Loans as contemplated by this Agreement, (a) the obligation
of such Lender hereunder to make LIBOR Rate Loans, continue LIBOR Rate Loans as
such, and convert Reference Rate Loans to LIBOR Rate Loans shall forthwith be
suspended and (b)&#160;such Lender&#146;s then outstanding LIBOR Rate Loans, if
any, shall be converted automatically to Reference Rate Loans on the respective
last days of the then current Interest Periods with respect thereto or within
such earlier period as required by law; <U>provided</U>, <U>however</U>, that
before making any such demand, each Lender agrees to use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions and
so long as such efforts would not be disadvantageous to it, in its reasonable
discretion, in any legal, economic, or regulatory manner) to designate a
different lending office if the making of such a designation would allow such
Lender or its lending office to continue to perform its obligations to make
LIBOR Rate Loans. If any such conversion of a LIBOR Rate Loan occurs on a day
which is not the last day of the then current Interest Period with respect
thereto, Borrowers shall pay to such Lender such amounts, if any, as may be
required pursuant to
<U>Section&#160;2.15</U>. If circumstances subsequently change so that such
Lender shall determine that it is no longer so affected, such Lender will
promptly notify Agent and Administrative Borrower, and upon receipt of such
notice, the obligations of such Lender to make or continue LIBOR Rate Loans or
to convert Reference Rate Loans into LIBOR Rate Loans shall be reinstated. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.15 Requirements of Law.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof by a Governmental Authority made
subsequent to the Closing Date or compliance by any Lender with any request or
directive (whether or not having the force of law) from any central bank or
other Governmental Authority made subsequent to the Closing Date</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) shall subject
such Lender to any tax, levy, charge, fee, reduction, or withholding of any kind
whatsoever with respect to LIBOR Rate Loans, or change the basis of taxation of
payments to such Lender in respect thereof (except for the establishment of a
tax based on the net income of the Lender or changes in the rate of tax on the
net income of such Lender);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) shall in
respect of LIBOR Rate Loans impose, modify or hold applicable any reserve,
special deposit, compulsory loan, or similar requirement against assets held by,
deposits or other liabilities in or for the account of, Advances or other
extensions of credit by, or any other acquisition of funds by, any office of
such Lender; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) shall impose
on such Lender any other condition with respect to LIBOR Rate Loans;</FONT></P>

<P><FONT SIZE=3>and the result of any of the foregoing is to increase the cost
to such Lender, by an amount which such Lender deems to be material, of making,
converting into, continuing, or maintaining LIBOR Rate Loans or to increase the
cost to such Lender in respect of LIBOR Rate Loans, by an amount which such
Lender deems to be material, or to reduce any amount receivable hereunder in
respect of LIBOR Rate Loans, or to forego any other sum payable thereunder or
make any payment on account thereof in respect of LIBOR Rate Loans, then, in any
such case, Borrowers shall promptly pay to Agent (for the benefit of such
Lender), upon such Lender&#146;s demand, any additional amounts necessary to
compensate such Lender for such increased cost or reduced amount receivable;
<U>provided</U>, <U>however</U>, that before making any such demand, each Lender
agrees to use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions and so long as such efforts would not be
disadvantageous to it, in its reasonable discretion, in any legal, economic, or
regulatory manner) to designate a different LIBOR lending office if the making
of such designation would allow such Lender or its LIBOR lending office to
continue to perform its obligations to make LIBOR Rate Loans or to continue to
fund or maintain LIBOR Rate Loans and avoid the need for, or materially reduce
the amount of, such increased cost. If a Lender becomes entitled to claim any
additional amounts pursuant to this
<U>Section&#160;2.15</U>, such Lender shall promptly notify Agent and
Administrative Borrower of the event by reason of which it has become so
entitled. A certificate as to any additional amounts payable pursuant to this
<U>Section&#160;2.15</U> submitted in reasonable detail by such Lender to Agent
and Administrative Borrower shall be conclusive in the absence of manifest
error. Within five Business Days after a Lender notifies Agent and
Administrative Borrower of any increased cost pursuant to the foregoing
provisions of this Section&#160;2.15, Administrative Borrower may convert all
LIBOR Rate Loans then outstanding into Reference Rate Loans in accordance with
<U>Section&#160;2.13</U> and, additionally, reimburse such Lender for any cost
in accordance with <U>Section 2.16</U>. This covenant shall survive the
termination of this Agreement and the payment of the Advances and all other
amounts payable hereunder for nine months following such termination and
repayment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) If a Lender shall have determined that the adoption of or any change in any
Requirement of Law regarding capital adequacy or in the interpretation or
application thereof by a Governmental Authority made subsequent to the Closing
Date or compliance by such Lender or any Person controlling such Lender with any
request or directive regarding capital adequacy (whether or not having the force
of law) from any Governmental Authority made subsequent to the Closing Date does
or shall have the effect of increasing the amount of capital required to be
maintained or reducing the rate of return on such Lender's or such Person's
capital as a consequence of its obligations hereunder to a level below that
which such Lender or such Person could have achieved but for such change or
compliance (taking into consideration such Lender's or such Person's policies
with respect to capital adequacy) by an amount deemed by such Lender to be
material, then from time to time, after submission by such Lender to Agent and
Administrative Borrower of a prompt written request therefor, Borrowers shall
pay to Agent (for the benefit of such Lender) such additional amount or amounts
as will compensate such Lender or such Person for such reduction. This covenant
shall survive the termination of this Agreement and the payment of the Advances
and all other amounts payable hereunder for nine months following such
termination and repayment.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.16  Indemnity.</B> Each Borrower agrees to indemnify Agent and each Lender
and to hold Agent and each Lender harmless from any loss or expense which Agent
and each Lender may sustain or incur as a consequence of (a)&#160;default by
Borrowers in payment when due of the principal amount of or interest on any
LIBOR Rate Loan, (b)&#160;default by Borrowers in making a Borrowing of,
conversion into, or continuation of LIBOR Rate Loans after Administrative
Borrower have given a notice requesting the same in accordance with the
provisions of this Agreement, (c)&#160;default by Borrowers in making any
prepayment of a LIBOR Rate Loan after Administrative Borrower has given a notice
thereof in accordance with the provisions of this Agreement, or (d)&#160;the
making of a prepayment of LIBOR Rate Loans on a day which is not the last day of
an Interest Period with respect thereto (whether due to the termination of this
Agreement, upon an Event of Default, or otherwise), including, in each case, any
such loss or expense (but excluding loss of margin or anticipated profits)
arising from the reemployment of funds obtained by it or from fees payable to
terminate the deposits from which such funds were obtained; <U>provided</U>,
<U>however</U>, that Agent or any Lender, if requesting indemnification, shall
have delivered to the Borrowers a certificate as to the amount of such loss or
expense, which certificate shall be conclusive in the absence of manifest error.
Calculation of all amounts payable to Agent or any such Lender under this
<U>Section&#160;2.16</U> shall be made as though such Lender had actually funded
the relevant LIBOR Rate Loan through the purchase of a deposit bearing interest
at the LIBOR Rate in an amount equal to the amount of such LIBOR Rate Loan and
having a maturity comparable to the relevant Interest Period; <U>provided</U>,
<U>however</U>, that each Lender may fund each of the LIBOR Rate Loans in any
manner it sees fit, and the foregoing assumption shall be utilized only for the
calculation of amounts payable under this <U>Section&#160;2.16</U>. This
covenant shall survive the termination of this Agreement and the payment of the
Loans and all other amounts payable hereunder for a period of nine months
thereafter.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.17 Joint and Several Liability of Borrowers.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Each Borrower
is accepting joint and several liability hereunder and under the other Loan
Documents in consideration of the financial accommodations to be provided by the
Agent and the Lenders under this Agreement, for the mutual benefit, directly and
indirectly, of each Borrower and in consideration of the undertakings of the
other Borrowers to accept joint and several liability for the Obligations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) Each Borrower,
jointly and severally, hereby irrevocably and unconditionally accepts, not
merely as a surety but also as a co-debtor, joint and several liability with the
other Borrowers, with respect to the payment and performance of all of the
Obligations (including, without limitation, any Obligations arising under this
<U>Section 2.17</U>), it being the intention of the parties hereto that all the
Obligations shall be the joint and several obligations of each Person composing
Borrowers without preferences or distinction among them.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) If and to the
extent that any of Borrowers shall fail to make any payment with respect to any
of the Obligations as and when due or to perform any of the Obligations in
accordance with the terms thereof, then in each such event the other Persons
composing Borrowers will make such payment with respect to, or perform, such
Obligation.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) The Obligations
of each Person composing Borrowers under the provisions of this <U>Section 2.17</U>
constitute the absolute and unconditional, full recourse Obligations of each
Person composing Borrowers enforceable against each such Borrower to the full
extent of its properties and assets, irrespective of the validity, regularity or
enforceability of this Agreement or any other circumstances whatsoever.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) Except as
otherwise expressly provided in this Agreement, each Person composing Borrowers
hereby waives notice of acceptance of its joint and several liability, notice of
any Advances or Letters of Credit issued under or pursuant to this Agreement,
notice of the occurrence of any Default, Event of Default, or of any demand for
any payment under this Agreement, notice of any action at any time taken or
omitted by Agent or Lenders under or in respect of any of the Obligations, any
requirement of diligence or to mitigate damages and, generally, to the extent
permitted by applicable law, all demands, notices and other formalities of every
kind in connection with this Agreement (except as otherwise provided in this
Agreement). Each Person composing Borrowers hereby assents to, and waives notice
of, any extension or postponement of the time for the payment of any of the
Obligations, the acceptance of any payment of any of the Obligations, the
acceptance of any partial payment thereon, any waiver, consent or other action
or acquiescence by Agent or Lenders at any time or times in respect of any
default by any Person composing Borrowers in the performance or satisfaction of
any term, covenant, condition or provision of this Agreement, any and all other
indulgences whatsoever by Agent or Lenders in respect of any of the Obligations,
and the taking, addition, substitution or release, in whole or in part, at any
time or times, of any security for any of the Obligations or the addition,
substitution or release, in whole or in part, of any Person composing Borrowers.
Without limiting the generality of the foregoing, each Borrower assents to any
other action or delay in acting or failure to act on the part of any Agent or
Lender with respect to the failure by any Person composing Borrowers to comply
with any of its respective Obligations, including, without limitation, any
failure strictly or diligently to assert any right or to pursue any remedy or to
comply fully with applicable laws or regulations thereunder, which might, but
for the provisions of this <U>Section 2.17</U> afford grounds for terminating,
discharging or relieving any Person composing Borrowers, in whole or in part,
from any of its Obligations under this <U>Section 2.17</U>, it being the intention of
each Person composing Borrowers that, so long as any of the Obligations
hereunder remain unsatisfied, the Obligations of such Person composing Borrowers
under this <U>Section 2.17</U> shall not be discharged except by performance and then
only to the extent of such performance. The Obligations of each Person composing
Borrowers under this <U>Section 2.17</U> shall not be diminished or rendered
unenforceable by any winding up, reorganization, arrangement, liquidation,
reconstruction or similar proceeding with respect to any Person composing
Borrowers or any Agent or Lender. The joint and several liability of the Persons
composing Borrowers hereunder shall continue in full force and effect
notwithstanding any absorption, merger, amalgamation or any other change
whatsoever in the name, constitution or place of formation of any of the Persons
composing Borrowers or any Agent or Lender.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) Each Person
composing Borrowers represents and warrants to Agent and Lenders that such
Borrower is currently informed of the financial condition of Borrowers and of
all other circumstances which a diligent inquiry would reveal and which bear
upon the risk of nonpayment of the Obligations. Each Person composing Borrowers
further represents and warrants to Agent and Lenders that such Borrower has read
and understands the terms and conditions of the Loan Documents. Each Person
composing Borrowers hereby covenants that such Borrower will continue to keep
informed of Borrowers' financial condition, the financial condition of other
guarantors, if any, and of all other circumstances which bear upon the risk of
nonpayment or nonperformance of the Obligations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) The provisions
of this <U>Section 2.17</U> are made for the benefit of the Agent, the Lenders and
their respective successors and assigns, and may be enforced by it or them from
time to time against any or all of the Persons composing Borrowers as often as
occasion therefor may arise and without requirement on the part of any such
Agent, Lender, successor or assign first to marshal any of its or their claims
or to exercise any of its or their rights against any of the other Persons
composing Borrowers or to exhaust any remedies available to it or them against
any of the other Persons composing Borrowers or to resort to any other source or
means of obtaining payment of any of the Obligations hereunder or to elect any
other remedy. The provisions of this <U>Section 2.17</U> shall remain in effect until
all of the Obligations shall have been paid in full or otherwise fully
satisfied. If at any time, any payment, or any part thereof, made in respect of
any of the Obligations, is rescinded or must otherwise be restored or returned
by any Agent or Lender upon the insolvency, bankruptcy or reorganization of any
of the Persons composing Borrowers, or otherwise, the provisions of this <U>Section
2.17</U> will forthwith be reinstated in effect, as though such payment had not been
made.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) Each of the
Persons composing Borrowers hereby agrees that it will not enforce any of its
rights of contribution or subrogation against the other Persons composing
Borrowers with respect to any liability incurred by it hereunder or under any of
the other Loan Documents, any payments made by it to the Agent or the Lenders
with respect to any of the Obligations or any collateral security therefor until
such time as all of the Obligations have been paid in full in cash. Any claim
which any Borrower may have against any other Borrower with respect to any
payments to any Agent or Lender hereunder or under any other Loan Documents are
hereby expressly made subordinate and junior in right of payment, without
limitation as to any increases in the Obligations arising hereunder or
thereunder, to the prior payment in full in cash of the Obligations and, in the
event of any insolvency, bankruptcy, receivership, liquidation, reorganization
or other similar proceeding under the laws of any jurisdiction relating to any
Borrower, its debts or its assets, whether voluntary or involuntary, all such
Obligations shall be paid in full in cash before any payment or distribution of
any character, whether in cash, securities or other property, shall be made to
any other Borrower therefor.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Each of the
Persons composing Borrowers hereby agrees that, after the occurrence and during
the continuance of any Default or Event of Default, the payment of any amounts
due with respect to the indebtedness owing by any Borrower to any other Borrower
is hereby subordinated to the prior payment in full in cash of the Obligations.
Each Borrower hereby agrees that after the occurrence and during the continuance
of any Default or Event of Default, such Borrower will not demand, sue for or
otherwise attempt to collect any indebtedness of any other Borrower owing to
such Borrower until the Obligations shall have been paid in full in cash. If,
notwithstanding the foregoing sentence, such Borrower shall collect, enforce or
receive any amounts in respect of such indebtedness, such amounts shall be
collected, enforced and received by such Borrower as trustee for the Agent, and
such Borrower shall deliver any such amounts to Agent for application to the
Obligations in accordance with <U>Section 2.5(b)</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3. CONDITIONS; TERM OF AGREEMENT.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.1 Conditions Precedent to the Initial Advance and the Initial Letter of
Credit</B>. The obligation of the Lender Group to make the initial Advance and
to issue the initial Letter of Credit is subject to the fulfillment, to the
satisfaction of Agent and its counsel, of each of the following conditions on or
before the Closing Date:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) the Closing Date shall occur on or before February 15, 2005;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) Agent shall
have received and filed amendments to its financing statements;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) Agent shall
have received the Guaranties, duly executed, and each such document shall be in
full force and effect.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) Agent shall
have received a certificate from the Secretary of each Borrower attesting to the
resolutions of such Borrower's Board of Directors authorizing its execution,
delivery, and performance of this Agreement and the other Loan Documents to
which such Borrower is a party and authorizing specific officers of such
Borrower to execute the same;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) Agent shall
have received copies of each Borrower's Governing Documents, as amended,
modified, or supplemented to the Closing Date, certified by the Secretary of
each Borrower;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) Agent shall
have received a certificate of status with respect to each Borrower, dated
within 10 days of the Closing Date, such certificate to be issued by the
appropriate officer of the jurisdiction of organization of each Borrower, which
certificate shall indicate that such Borrower is in good standing in such
jurisdiction;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) Agent shall
have received a certificate of insurance, together with the endorsements
thereto, as are required by <U>Section 6.9</U>, the form and substance of which shall
be satisfactory to Agent and its counsel;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) Agent shall
have received an opinion of Borrowers' counsel in form and substance
satisfactory to Agent in its sole discretion;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) all other
documents and legal matters in connection with the transactions contemplated by
this Agreement shall have been delivered, executed, or recorded and shall be in
form and substance satisfactory to Agent and its counsel.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.2 Conditions Precedent to all Advances and all Letters of Credit</B>. The
following shall be conditions precedent to all Advances and all Letters of
Credit hereunder:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) the
representations and warranties contained in this Agreement and the other Loan
Documents shall be true and correct in all material respects on and as of the
date of such extension of credit, as though made on and as of such date (except
to the extent that such representations and warranties relate solely to an
earlier date);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) except for good
faith disputes between a Borrower and landlords, no Default or Event of Default
shall have occurred and be continuing on the date of such extension of credit,
nor shall either result from the making thereof;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) no injunction,
writ, restraining order, or other order of any nature prohibiting, directly or
indirectly, the extending of such credit shall have been issued and remain in
force by any governmental authority against any Borrower, the Lender Group or
any of their Affiliates;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) the amount of
any requested Advance or Letter of Credit shall not exceed Availability at such
time; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) with respect to
Advances under the Temporary Overadvance Facility, (i) receipt and satisfactory
review by the Agent, in the Agent's sole and exclusive discretion, of the
definitive Disney License Agreement and confirmation that the Disney License
Agreement is in full force and effect, and (ii) confirmation by the Agent that
all Conditions Precedent (Article 3) of the Loan and Security Agreement to be
entered into by the Agent and the Lenders party thereto with The Disney Stores,
LLC have been satisfied.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.3 Intentionally Omitted.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.4 Term; Automatic Renewal</B>. This Agreement shall become effective as
of October 31, 2004 upon the execution and delivery hereof by Borrower and the
Lender Group and shall continue in full force and effect for a term ending on
November 1, 2007 (the &quot;Renewal Date&quot;) and automatically shall be
renewed for successive one year periods thereafter, unless sooner terminated
pursuant to the terms hereof. Either Administrative Borrower or Agent (on behalf
of the Lender Group) may terminate this Agreement effective on the Renewal Date
or on any year anniversary of the Renewal Date by giving the other party at
least 90 days prior written notice. The foregoing notwithstanding, Agent (on
behalf of the Lender Group) shall have the right to terminate the Lender Group's
obligations under this Agreement immediately and without notice upon the
occurrence and during the continuation of an Event of Default.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.5 Effect of Termination.</B> On the date of termination of this Agreement,
all Obligations (including contingent reimbursement obligations of Borrowers
with respect to any outstanding Letters of Credit and including Bank Product
Obligations) immediately shall become due and payable without notice or demand.
No termination of this Agreement, however, shall relieve or discharge Borrowers
of Borrowers' duties, Obligations, or covenants hereunder, and the Lender
Group's continuing security interests in the Collateral shall remain in effect
until all Obligations have been fully and finally discharged and the Lender
Group's obligation to provide additional credit hereunder is terminated.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.6 Early Termination by Borrowers</B>. Borrowers have the option, at any
time upon 90 days prior written notice to Agent, to terminate this Agreement by
paying to Agent, for the benefit of the Lender Group, in cash, the Obligations
(including either (a)&#160;providing cash collateral to be held by Agent for the
benefit of those Lenders with a Commitment in an amount equal to 105% of the
then outstanding Letters of Credit, or (b)&#160;causing the outstanding original
Letters of Credit to be returned to the issuer thereof, in full, together with
the Applicable Prepayment Premium (to be allocated based upon letter agreements
between Agent and individual Lenders). If Administrative Borrower has sent a
notice of termination pursuant to the provisions of this Section, then the
Commitments shall terminate and Borrowers shall be obligated to repay the
Obligations (including either (i) providing cash collateral to be held by Agent
for the benefit of those Lenders with a Commitment in an amount equal to 105% of
the then outstanding Letters of Credit, or (ii) causing the original Letters of
Credit to be returned to the issuer thereof, in full, together with the
Applicable Prepayment Premium, on the date set forth as the date of termination
of this Agreement in such notice. In the event of the termination of this
Agreement and repayment of the Obligations at any time prior to the date on
which this Agreement is scheduled to terminate pursuant to <U>Section 3.4</U>
hereof, for any other reason, including (a)&#160;foreclosure and sale of
Collateral, (b) sale of the Collateral in any Insolvency Proceeding, or (c)
restructure, reorganization, or compromise of the Obligations by the
confirmation of a plan of reorganization or any other plan of compromise,
restructure, or arrangement in any Insolvency Proceeding, then, in view of the
impracticability and extreme difficulty of ascertaining the actual amount of
damages to the Lender Group or profits lost by the Lender Group as a result of
such early termination, and by mutual agreement of the parties as to a
reasonable estimation and calculation of the lost profits or damages of the
Lender Group, Borrower shall pay the Applicable Prepayment Premium to Agent (to
be allocated based upon letter agreements between Agent and individual Lenders),
measured as of the date of such termination.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4. CREATION OF SECURITY INTEREST.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.1 Grant of Security Interests</B>. Each Borrower hereby grants to Agent for
the benefit of the Lender Group a continuing security interest in all currently
existing and hereafter acquired or arising Collateral in order to secure prompt
repayment of any and all Obligations and in order to secure prompt performance
by such Borrower of each of its covenants and duties under the Loan Documents.
The security interests of Agent for the benefit of the Lender Group in the
Collateral shall attach to all Collateral without further act on the part of the
Lender Group or Borrower. Anything contained in this Agreement or any other Loan
Document to the contrary notwithstanding, and other than: (a)&#160;sales of
Inventory to buyers in the ordinary course of business, (b)&#160;sales of
Equipment in any 12 month period having an aggregate net book value of $500,000
with the proceeds being applied to the Obligations, and (c) sale or disposal of
Collateral (other than Inventory) in connection with the closing of
Borrowers&#146; stores, Borrowers have no authority, express or implied, to
dispose of any item or portion of the Collateral.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.2 Negotiable Collateral.</B> In the event that any Collateral, including
proceeds, is evidenced by or consists of Negotiable Collateral, Borrowers,
immediately upon the request of Agent, shall endorse and deliver physical
possession of such Negotiable Collateral to Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.3 Collection of Accounts, General Intangibles, and Negotiable
Collateral</B>. At any time, Agent or Agent's designee may (a)&#160;notify
customers or Account Debtors of any Borrower that the Accounts, General
Intangibles, or Negotiable Collateral have been assigned to Agent for the
benefit of the Lender Group or that Agent for the benefit of the Lender Group
has a security interest therein, and (b)&#160;collect the Accounts, General
Intangibles, and Negotiable Collateral directly and charge the collection costs
and expenses to the Loan Account. Each Borrower agrees that, subject to Section
2.9, it will hold in trust for the Lender Group, as the Lender Group's trustee,
any Collections that it receives and immediately will deliver said Collections
to Agent in their original form as received by such Borrower.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.4 Delivery of Additional Documentation Required</B>. At any time upon the
request of Agent, Borrowers shall execute and deliver to Agent all financing
statements, continuation financing statements, fixture filings, security
agreements, pledges, assignments, control agreements, endorsements of
certificates of title, applications for title, affidavits, reports, notices,
schedules of accounts, letters of authority, and all other documents that Agent
reasonably may request, in form satisfactory to Agent, to perfect and continue
perfected the Liens of the Lender Group in the Collateral, and in order to fully
consummate all of the transactions contemplated hereby and under the other the
Loan Documents.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.5 Power of Attorney</B>. Each Borrower hereby irrevocably makes,
constitutes, and appoints Agent (and any of Agent's officers, employees, or
agents designated by Agent) as such Borrower's true and lawful attorney, with
power to (a)&#160;if any Borrower refuses to, or fails timely to execute and
deliver any of the documents described in <U>Section 4.4</U>, sign the name of
such Borrower on any of the documents described in <U>Section 4.4</U>,
(b)&#160;at any time that an Event of Default has occurred and is continuing or
the Lender Group deems itself insecure, sign such Borrower's name on any invoice
or bill of lading relating to any Account, drafts against Account Debtors,
schedules and assignments of Accounts, verifications of Accounts, and notices to
Account Debtors, (c)&#160;send requests for verification of Accounts,
(d)&#160;endorse such Borrower's name on any Collection item that may come into
the Lender Group's possession, (e)&#160;at any time that an Event of Default has
occurred and is continuing or the Lender Group deems itself insecure, notify the
post office authorities to change the address for delivery of such Borrower's
mail to an address designated by Agent, to receive and open all mail addressed
to such Borrower, and to retain all mail relating to the Collateral and forward
all other mail to such Borrower, (f)&#160;at any time that an Event of Default
has occurred and is continuing or the Lender Group deems itself insecure, make,
settle, and adjust all claims under Borrowers' policies of insurance and make
all determinations and decisions with respect to such policies of insurance, and
(g) at any time that an Event of Default has occurred and is continuing or Agent
deems itself insecure, settle and adjust disputes and claims respecting the
Accounts directly with Account Debtors, for amounts and upon terms that Agent
determines to be reasonable, and Agent may cause to be executed and delivered
any documents and releases that Agent determines to be necessary. The
appointment of Agent as each Borrower's attorney, and each and every one of
Agent's rights and powers, being coupled with an interest, is irrevocable until
all of the Obligations have been fully and finally repaid and performed and the
Lender Group's obligation to extend credit hereunder is terminated.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.6 Right to Inspect</B>. Agent (through any of its officers, employees, or
agents), shall have the right, from time to time hereafter to inspect Books and
to check, test, and appraise the Collateral in order to verify Borrowers'
financial condition or the amount, quality, value, condition of, or any other
matter relating to, the Collateral.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5. REPRESENTATIONS AND WARRANTIES</B>. In order to induce the Lender Group to
enter into this Agreement, each Borrower makes the following representations and
warranties which shall be true, correct, and complete in all respects as of the
date hereof, and shall be true, correct, and complete in all respects as of the
Closing Date, and at and as of the date of the making of each Advance and Letter
of Credit made thereafter, as though made on and as of the date of such Advance
and Letter of Credit (except to the extent that such representations and
warranties relate solely to an earlier date) and such representations and
warranties shall survive the execution and delivery of this Agreement:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.1 No Encumbrances</B>. Each Borrower has good and indefeasible title to the
Collateral, free and clear of Liens except for Permitted Liens.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.2 Eligible Accounts</B>. The Eligible Accounts are, at the time of the
creation thereof and as of each date on which Borrowers includes them in a
Borrowing Base calculation or certification, bona fide existing obligations
created by the sale and delivery of Inventory or the rendition of services to
Account Debtors in the ordinary course of Borrowers' business, unconditionally
owed to Borrowers without defenses, disputes, offsets, counterclaims, or rights
of return or cancellation other than normal returns or disputes in the normal
course of business. The property giving rise to such Eligible Accounts has been
delivered to the Account Debtor, or to the Account Debtor's agent for immediate
shipment to and unconditional acceptance by the Account Debtor. At the time of
the creation of an Eligible Account and as of each date on which Borrower
includes an Eligible Account in a Borrowing Base calculation or certification,
Borrower has not received notice of actual or imminent bankruptcy, insolvency,
or material impairment of the financial condition of any applicable Account
Debtor regarding such Eligible Account.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.3 Eligible Inventory</B>. All Eligible Inventory is now and at all times
hereafter shall be of good and merchantable quality, free from defects, except
for minor defects arising in the ordinary course of business.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.4 Equipment</B>. All of the Equipment is used or held for use in Borrowers'
business and is fit for such purposes.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.5 Location of Inventory and Equipment</B>. The Inventory (other than
Inventory in transit) and Equipment are not stored with a bailee, warehouseman,
or similar party (without Agent's prior written consent) and are located only at
the locations identified on <U>Schedule&#160;6.11</U> or otherwise permitted by
<U>Section&#160;6.11</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.6 Inventory Records</B>. Each Borrower keeps correct and accurate records
itemizing and describing the kind, type, quality and quantity of its Inventory
and each Borrower&#146;s cost therefor in accordance with the retail method of
accounting.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.7 Location of Chief Executive Office; FEIN</B>. The chief executive office
of Borrower is located at the address indicated in the preamble to this
Agreement and Parent&#146;s FEIN is 31-1241495 and Services Company&#146;s FEIN
is 20-0850965.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.8 Due Organization and Qualification; Subsidiaries.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Each Borrower is duly organized and existing and in good standing under the
laws of the jurisdiction of its incorporation and qualified and licensed to do
business in, and in good standing in, any state where the failure to be so
licensed or qualified reasonably could be expected to cause a Material Adverse
Change.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) Set forth on <U>Schedule 5.8</U>, is a complete and accurate list of each
Borrower's direct and indirect Subsidiaries, showing: (i) the jurisdiction of
their incorporation; (ii) the number of shares of each class of common and
preferred stock authorized for each of such Subsidiaries; and (iii) the number
and the percentage of the outstanding shares of each such class owned directly
or indirectly by the applicable Borrower. All of the outstanding capital stock
of each such Subsidiary has been validly issued and is fully paid and
non-assessable.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) Except as set forth on <U>Schedule 5.8</U>, no capital stock (or any securities,
instruments, warrants, options, purchase rights, conversion or exchange rights,
calls, commitments or claims of any character convertible into or exercisable
for capital stock) of any direct or indirect Subsidiary of Borrower is subject
to the issuance of any security, instrument, warrant, option, purchase right,
conversion or exchange right, call, commitment or claim of any right, title, or
interest therein or thereto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.9 Due Authorization; No Conflict.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>
Each Borrower is duly organized and existing and in good standing under the laws
of the state of its incorporation and qualified and licensed to do business in,
and in good standing in, any state where the failure to be so licensed or
qualified could reasonably be expected to have a material adverse effect on the
business, operations, condition (financial or otherwise), finances, or prospects
of Borrower or on the value of the Collateral to Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.10 Litigation</B>. There are no actions or proceedings pending by or
against Borrowers before any court or administrative agency and Borrowers do not
have knowledge or belief of any pending, threatened, or imminent litigation,
governmental investigations, or claims, complaints, actions, or prosecutions
involving Borrowers or any guarantor of the Obligations, except for: (a) ongoing
collection matters in which Borrowers are the plaintiff; and (b) current matters
that, if decided adversely to Borrowers, would not materially impair the
prospect of repayment of the Obligations or materially impair the value or
priority of the Lender Group&#146;s security interests in the Collateral.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.11 No Material Adverse Change</B>. All financial statements relating to
Borrowers or any guarantor of the Obligations that have been delivered by
Borrowers to the Lender Group have been prepared in accordance with GAAP
(except, in the case of unaudited financial statements, for the lack of
footnotes and being subject to year-end audit adjustments) and fairly present
Borrowers' (or such guarantor's, as applicable) financial condition as of the
date thereof and Borrowers' results of operations for the period then ended.
There has not been a Material Adverse Change with respect to Borrowers (or such
guarantor, as applicable) since the date of the latest financial statements
submitted to the Lender Group on or before the Closing Date.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.12 Fraudulent Transfer.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Each Borrower and each Subsidiary of a Borrower is Solvent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) No transfer of
property is being made by any Borrower or any Subsidiary of a Borrower and no
obligation is being incurred by any Borrower or any Subsidiary of a Borrower in
connection with the transactions contemplated by this Agreement or the other
Loan Documents with the intent to hinder, delay, or defraud either present or
future creditors of Borrowers or their Subsidiaries.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.13 Employee Benefits</B>. None of any Borrower, any of its Subsidiaries, or
any of their ERISA Affiliates maintains or contributes to any Benefit Plan,
other than those listed on Schedule&#160;5.13. Each Borrower, each of its
Subsidiaries and each ERISA Affiliate have satisfied the minimum funding
standards of ERISA and the IRC with respect to each Benefit Plan to which it is
obligated to contribute. No ERISA Event has occurred nor has any other event
occurred that may result in an ERISA Event that reasonably could be expected to
result in a Material Adverse Change. Borrower or its Subsidiaries, any ERISA
Affiliate, or any fiduciary of any Plan is subject to any direct or indirect
liability with respect to any Plan under any applicable law, treaty, rule,
regulation, or agreement. No Borrower or its Subsidiaries or any ERISA Affiliate
is required to provide security to any Plan under Section 401(a)(29) of the IRC.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.14 Environmental Condition</B>. Except as set forth on Schedule&#160;5.14,
none of Borrowers' properties or assets has ever been used by Borrowers or, to
the best of Borrowers' knowledge, by previous owners or operators in the
disposal of, or to produce, store, handle, treat, release, or transport, any
Hazardous Materials. None of Borrowers' properties or assets has ever been
designated or identified in any manner pursuant to any environmental protection
statute as a Hazardous Materials disposal site, or a candidate for closure
pursuant to any environmental protection statute. No lien arising under any
environmental protection statute has attached to any revenues or to any real or
personal property owned or operated by Borrowers. Borrowers have not received a
summons, citation, notice, or directive from the Environmental Protection Agency
or any other federal or state governmental agency concerning any action or
omission by Borrowers resulting in the releasing or disposing of Hazardous
Materials into the environment.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6. AFFIRMATIVE COVENANTS.</B> Each Borrower covenants and agrees that, so
long as any credit hereunder shall be available and until full and final payment
of the Obligations, Borrowers shall do all of the following:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.1 Accounting System and Schedules.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Maintain a standard and modern system of accounting in accordance with GAAP
with ledger and account cards or computer tapes, discs, printouts, and records
pertaining to the Collateral which contain information as from time to time may
be requested by Agent. Borrowers also shall keep proper books of account showing
all sales, claims, and allowances on its Inventory.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) Schedules of Accounts. With such regularity as Agent shall require,
Borrowers shall provide Agent with schedules describing all Accounts. Agent's
failure to request such schedules or Borrowers' failure to execute and deliver
such schedules shall not affect or limit the Lender Group's security interests
or other rights in and to the Accounts.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.2 Financial Statements, Reports, Certificates</B>. Deliver to Agent. (a) as
soon as available, but in any event within 30 days after the end of each month
(or 45 days after the end of fiscal quarter) during each of Parent's fiscal
years, a company prepared balance sheet, income statement, and cash flow
statement covering Parent's operations during such period; and (b) as soon as
available, but in any event within 90 days after the end of each of Parent's
Fiscal Years, financial statements of Parent for each such Fiscal Year, audited
by independent certified public accountants reasonably acceptable to Agent and
certified, without any going concern or other material qualifications, by such
accountants to have been prepared in accordance with GAAP, together with a
certificate of such accountants addressed to Agent stating that such accountants
do not have knowledge of the existence of any failure of Parent to comply with
<U>Section&#160;7.20</U>. Such audited financial statements shall include a
balance sheet, profit and loss statement, and cash flow statement, and, if
prepared, such accountants' letter to management. If Parent is a parent company
of one or more Subsidiaries, or Affiliates, or is a Subsidiary or Affiliate of
another company, then, in addition to the financial statements referred to
above, Parent agrees to deliver financial statements prepared on a consolidating
basis so as to present Parent and each such related entity separately, and on a
consolidated basis.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>
Together with the above, Parent also shall deliver to Lenders Parent's Form 10-Q
Quarterly Reports, Form 10-K Annual Reports, and Form 8-K Current Reports, and
any other filings made by Parent with the Securities and Exchange Commission, if
any, as soon as the same are filed, or any other information that is provided by
Parent to its public shareholders, and any other report reasonably requested by
Agent relating to the Collateral and financial condition of Parent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>Each month, together with the financial statements
provided pursuant to
<U>Section&#160;6.2(a)</U>, Administrative Borrower shall deliver to Agent a
certificate signed by its chief financial officer to the effect that: (i) all
reports, statements, or computer prepared information of any kind or nature
delivered or caused to be delivered to Agent hereunder have been prepared in
accordance with GAAP and fairly present the financial condition of Borrowers;
(ii) Borrowers are in timely compliance with all of its covenants and agreements
hereunder; (iii) the representations and warranties of Borrowers contained in
this Agreement and the other Loan Documents are true and correct in all material
respects on and as of the date of such certificate, as though made on and as of
such date (except to the extent that such representations and warranties relate
solely to an earlier date); and (iv) on the date of delivery of such certificate
to Agent there does not exist any condition or event that constitutes an Event
of Default (or, in each case, to the extent of any non-compliance, describing
such non-compliance as to which he or she may have knowledge and what action
Borrowers have taken, is taking, or proposes to take with respect thereto).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>Administrative Borrower shall deliver to Agent its
Business Plan for each fiscal year commencing on or about February 1 on or
before March 1 of such fiscal year.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>
Administrative Borrower shall have issued written instructions to its
independent certified public accountants authorizing them to communicate with
Agent and to release to Agent whatever financial information concerning
Borrowers that Agent may request. Administrative Borrower hereby irrevocably
authorizes and directs all auditors, accountants, or other third parties to
deliver to Agent, at Borrowers' expense, copies of Borrowers' financial
statements, papers related thereto, and other accounting records of any nature
in their possession, and to disclose to Agent any information they may have
regarding the Collateral or the financial condition of Borrowers.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.3 Tax Returns.</B> Deliver to Agent copies of each of Parent's future
federal income tax returns, and any amendments thereto, concurrently with the
filing thereof with the Internal Revenue Service.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.4 Designation of Inventory.</B> Borrowers shall now and from time to time
hereafter, but not less frequently than weekly (or monthly so long as Borrowers
have maintained at least $25,000,000 of Availability without being limited by
the Maximum Amount) (to be delivered each Monday based upon the close of
business on the preceding Saturday), execute and deliver to Agent a designation
of Inventory specifying the retail selling price of Borrowers&#146; Inventory,
and not less frequently than monthly, execute and deliver to Agent a designation
of Inventory specifying Borrowers&#146; Cost, and further specifying such other
information as Agent may reasonably request. Such designation shall separately
report Inventory that is subject to a letter of credit issued by any Person
other than Agent. Borrowers will not include Inventory in transit in its
Inventory reports until such Inventory has been paid for by draws under
applicable letters of credit or has been acquired by Borrowers without letter of
credit financing.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.5 Store Openings and Closings and Rents Reports.</B> Borrowers shall give
Agent reasonable prior notice of new store openings and closing of its stores.
Borrowers shall make timely payment of all rents on real property leases where
Borrower is the lessee within applicable grace periods, and shall provide Agent
with a monthly report specifying the status of such payments. In the event that
Borrowers become delinquent in their rent payments, then Agent can establish
reserves against the Borrowing Base for the amount of any landlord liens arising
from such delinquency.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.6 Title to Equipment</B>. Upon Agent's request, Borrowers shall within 30
days of such request deliver to Agent, properly endorsed, any and all evidences
of ownership of, certificates of title, or applications for title to any items
of Equipment with a market value of $100,000 or more other than Equipment leased
or to be leased.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.7 Maintenance of Equipment</B>. Maintain the Equipment in good operating
condition and repair (ordinary wear and tear excepted), and make all necessary
replacements thereto so that the value and operating efficiency thereof shall at
all times be maintained and preserved. Other than those items of Equipment that
constitute fixtures on the Closing Date, Borrower shall not permit any item of
Equipment to become a fixture to real estate or an accession to other property,
and such Equipment shall at all times remain personal property.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.8 Taxes</B>. Cause all assessments and taxes, whether real, personal, or
otherwise, due or payable by, or imposed, levied, or assessed against Borrowers,
their Subsidiaries, or any of their property to be paid in full, before
delinquency or before the expiration of any extension period, except to the
extent that the validity of such assessment or tax shall be the subject of a
Permitted Protest. Borrowers shall make due and timely payment or deposit of all
such federal, state, and local taxes, assessments, or contributions required of
it by law, and will execute and deliver to Agent, on demand, appropriate
certificates attesting to the payment thereof or deposit with respect thereto.
Borrowers will make timely payment or deposit of all tax payments and
withholding taxes required of it by applicable laws, including those laws
concerning F.I.C.A., F.U.T.A., state disability, and local, state, and federal
income taxes, and will, upon request, furnish Agent with proof satisfactory to
Agent indicating that Borrowers have made such payments or deposits.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.9 Insurance.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Borrowers, at their expense, shall keep the Collateral insured against loss
or damage by fire, theft, explosion, sprinklers, and all other hazards and
risks, and in such amounts, as are ordinarily insured against by other owners in
similar businesses. Borrowers also shall maintain business interruption, public
liability, product liability, and property damage insurance relating to
Borrowers' ownership and use of the Collateral, as well as insurance against
larceny, embezzlement, and criminal misappropriation.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) All such policies of insurance shall be in such form, with such companies,
and in such amounts as may be reasonably satisfactory to Agent. All such
policies of insurance (except those of public liability and property damage)
shall contain a 438BFU lender's loss payable endorsement, or an equivalent
endorsement in a form satisfactory to Agent, showing Agent as sole loss payee
thereof, and shall contain a waiver of warranties, and shall specify that the
insurer must give at least 10 days prior written notice to Agent before
canceling its policy for any reason. Administrative Borrower shall deliver to
Agent certified copies of such policies of insurance and evidence of the payment
of all premiums therefor. All proceeds payable under any such policy shall be
payable to Agent to be applied on account of the Obligations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.10 No Setoffs or Counterclaims</B>. Make payments hereunder and under the other
Loan Documents by or on behalf of Borrowers without setoff or counterclaim and
free and clear of, and without deduction or withholding for or on account of,
any federal, state, or local taxes.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.11 Location of Inventory and Equipment</B>. Keep the Inventory (other than
Inventory in transit) and Equipment only at the locations identified on
<U>Schedule&#160;6.11</U>; <U>provided</U>, <U>however</U>, that Borrowers may
amend <U>Schedule&#160;6.11</U> so long as such amendment occurs by written
notice to Agent not less than 30 days prior to the date on which the Inventory
or Equipment is moved to such new location, so long as such new location is
within the continental United States, Alaska, Hawaii or Puerto Rico, and so long
as, at the time of such written notification, Borrowers provide any financing
statements necessary to perfect and continue perfected the Lien of Agent for the
benefit of the Lender Group in such assets, and Borrowers will use their best
efforts to obtain a Collateral Access Agreement if requested by Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.12 Compliance with Laws</B>. Comply with the requirements of all applicable
laws, rules, regulations, and orders of any governmental authority, including
the Fair Labor Standards Act and the Americans With Disabilities Act, other than
laws, rules, regulations, and orders the non-compliance with which, individually
or in the aggregate, would not have and could not reasonably be expected to
cause a Material Adverse Change.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.13 Employee Benefits</B>. (a) Deliver to Agent: (i) promptly, and in any
event within 10 Business Days after Parent or any of its Subsidiaries knows or
has reason to know that an ERISA Event has occurred that reasonably could be
expected to result in a Material Adverse Change, a written statement of the
chief financial officer of Parent describing such ERISA Event and any action
that is being taking with respect thereto by Parent, any such Subsidiary or
ERISA Affiliate, and any action taken or threatened by the IRS, Department of
Labor, or PBGC. Parent or such Subsidiary, as applicable, shall be deemed to
know all facts known by the administrator of any Benefit Plan of which it is the
plan sponsor, (ii) promptly, and in any event within three Business Days after
the filing thereof with the IRS, a copy of each funding waiver request filed
with respect to any Benefit Plan and all communications received by Parent, any
of its Subsidiaries or, to the knowledge of Parent, any ERISA Affiliate with
respect to such request, and (iii) promptly, and in any event within three
Business Days after receipt by Parent, any of its Subsidiaries or, to the
knowledge of Parent, any ERISA Affiliate, of the PBGC's intention to terminate a
Benefit Plan or to have a trustee appointed to administer a Benefit Plan, copies
of each such notice.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) Cause to be delivered to Agent, upon Agent's request, each of the following:
(i) a copy of each Plan (or, where any such plan is not in writing, complete
description thereof) (and if applicable, related trust agreements or other
funding instruments) and all amendments thereto, all written interpretations
thereof and written descriptions thereof that have been distributed to employees
or former employees of Parent or its Subsidiaries; (ii) the most recent
determination letter issued by the IRS with respect to each Benefit Plan; (iii)
for the three most recent plan years, annual reports on Form 5500 Series
required to be filed with any governmental agency for each Benefit Plan; (iv)
all actuarial reports prepared for the last three plan years for each Benefit
Plan; (v) a listing of all Multiemployer Plans, with the aggregate amount of the
most recent annual contributions required to be made by Parent or any ERISA
Affiliate to each such plan and copies of the collective bargaining agreements
requiring such contributions; (vi) any information that has been provided to
Parent or any ERISA Affiliate regarding withdrawal liability under any
Multiemployer Plan; and (vii) the aggregate amount of the most recent annual
payments made to former employees of Parent or its Subsidiaries under any
Retiree Health Plan.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.14 Leases</B>. Pay when due all rents and other amounts payable under any
leases to which Parent is a party or by which Borrowers&#146; properties and
assets are bound, unless such payments are the subject of a Permitted Protest.
To the extent that Borrowers fail timely to make payment of such rents and other
amounts payable when due under their leases, Agent shall be entitled, in its
discretion, to reserve an amount equal to such unpaid amounts against the
Borrowing Base.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7. NEGATIVE COVENANTS</B>. Each Borrower covenants and agrees that, so long
as any credit hereunder shall be available and until full and final payment of
the Obligations, Borrowers will not do any of the following:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.1 Indebtedness</B> Create, incur, assume, permit, guarantee, or otherwise
become or remain, directly or indirectly, liable with respect to any
Indebtedness, except:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Indebtedness evidenced by this Agreement, together with Indebtedness to
issuers of letters of credit that is the subject of L/C Guarantees;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) Indebtedness set forth in <U>Schedule 7.1</U>;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) Indebtedness
secured by Permitted Liens;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) refinancings,
renewals, or extensions of Indebtedness permitted under clauses (b) and (c) of
this <U>Section 7.1</U> (and continuance or renewal of any Permitted Liens associated
therewith) so long as: (i) the terms and conditions of such refinancings,
renewals, or extensions do not materially impair the prospects of repayment of
the Obligations by Borrowers, (ii) the net cash proceeds of such refinancings,
renewals, or extensions do not result in an increase in the aggregate principal
amount of the Indebtedness so refinanced, renewed, or extended, (iii) such
refinancings, renewals, refundings, or extensions do not result in a shortening
of the average weighted maturity of the Indebtedness so refinanced, renewed, or
extended, and (iv) to the extent that Indebtedness that is refinanced was
subordinated in right of payment to the Obligations, then the subordination
terms and conditions of the refinancing Indebtedness must be at least as
favorable to the Lender Group as those applicable to the refinanced
Indebtedness;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) leases, whether
operating leases or capital leases of existing or after acquired Equipment;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) Indebtedness
subordinated to the Obligations on terms and conditions satisfactory to Agent;
and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) Indebtedness
incurred in connection with the Disney Stores Acquisition, as more particularly
set forth on Schedule 7.1, annexed hereto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.2 Liens</B>. Create, incur, assume, or permit to exist, directly or
indirectly, any Lien on or with respect to any of its property or assets, of any
kind, whether now owned or hereafter acquired, or any income or profits
therefrom, except for Permitted Liens (including Liens that are replacements of
Permitted Liens to the extent that the original Indebtedness is refinanced under
<U>Section&#160;7.1(d)</U> and so long as the replacement Liens only encumber
those assets or property that secured the original Indebtedness).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.3 Restrictions on Fundamental Changes</B>. Without Required Lenders&#146; prior
written consent, enter into any merger, consolidation, reorganization, or
recapitalization, or reclassify its capital stock, or liquidate, wind up, or
dissolve itself (or suffer any liquidation or dissolution), or convey, sell,
assign, lease, transfer, or otherwise dispose of, in one transaction or a series
of transactions, all or any substantial part of its property or assets; provided
that the foregoing shall not prohibit the Restructuring Transaction.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.4 Disposal of Assets</B>. Sell, lease, assign, transfer, or otherwise
dispose of any material portion of Borrowers' properties or assets other than
sales of (a)&#160;Inventory to buyers in the ordinary course of Borrowers'
business as currently conducted and (b)&#160;Equipment having a fair market
value, in the aggregate, of up to $500,000 in any Fiscal Year.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.5 Change Name</B>. Change any Borrower's name, FEIN, corporate structure
(within the meaning of <U>Section&#160;9402(7)</U> of the Code), state or
organization or identity, or add any new fictitious name.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.6 Guarantee</B>. Guarantee or otherwise become in any way liable with
respect to the obligations of any third Person except (i) by endorsement of
instruments or items of payment for deposit to the account of Borrowers or which
are transmitted or turned over to Agent; (ii) guarantee and indemnification
obligations to the Walt Disney Companies in accordance with the Acquisition
Agreement and the TCP Guaranty and Commitment (as defined in the Acquisition
Agreement); and (iii) indemnification obligations to the Walt Disney Companies
pursuant to the Disney License Agreement (as to which, the Borrowers are subject
to the restrictions set forth in Section 7.16, below). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.7 Nature of Business</B>. Make any change in the principal nature of
Borrower's business, other than in connection with the consummation of the
Disney Stores Acquisition.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.8 Prepayments and Amendments.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Except in
connection with a refinancing permitted by <U>Section 7.1(d)</U>, prepay,
redeem, retire, defease, purchase, or otherwise acquire any Indebtedness owing
to any third Person, other than the Obligations in accordance with this
Agreement, and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) Directly or
indirectly, amend, modify, alter, increase, or change any of the terms or
conditions of any agreement, instrument, document, indenture, or other writing
evidencing or concerning Indebtedness permitted under <U>Sections 7.1(b)</U>,
<U>(c)</U>, or <U>(d)</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.9 Change of Control</B>. Except for transfers of shares by Parent&#146;s
existing shareholders to members of their immediate family, cause, permit, or
suffer, directly or indirectly, any Change of Control. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.10 Consignments</B>. Consign any Inventory or sell any Inventory on bill
and hold, sale or return, sale on approval, or other conditional terms of sale.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.11 Distributions</B>. Make any distribution or declare or pay any dividends
(in cash or other property, other than capital stock) on, or purchase, acquire,
redeem, or retire any of Parent's capital stock, of any class, whether now or
hereafter outstanding; <U>provided</U>, <U>however</U>, Parent may buy back
certain of its capital stock so long as (i) no Event of Default or Default
exists and (ii) there has been at least $10,000,000 of borrowing Availability
under
<U>Section&#160;2.1</U> (without being limited by the Maximum Amount) as of the
end of each of the three months preceding such payment or purchase, and on such
date, after taking into account the payment or purchase of such stock.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.12 Accounting Methods</B>. Modify or change its method of accounting or
enter into, modify, or terminate any agreement currently existing, or at any
time hereafter entered into with any third party accounting firm or service
bureau for the preparation or storage of Borrowers' accounting records without
said accounting firm or service bureau agreeing to provide Agent information
regarding the Collateral or Borrowers' financial condition. Each Borrower waives
the right to assert a confidential relationship, if any, it may have with any
accounting firm or service bureau in connection with any information requested
by Agent pursuant to or in accordance with this Agreement, and agrees that Agent
may contact directly any such accounting firm or service bureau in order to
obtain such information.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.13 Advances, Investments and Loans.</B> Make any investment except:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) investments in cash and cash equivalents and equity investments in
Subsidiaries in an amount not to exceed $1,000,000 in the aggregate in any
Fiscal Year, (including not more than $750,000 to Twinbrook in any Fiscal Year;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) so long as no
Event of Default shall have occurred and be continuing, or would occur as a
consequence thereof, Parent and its Subsidiaries may (i) make loans and advances
to employees for moving and travel expenses and other similar expenses, in each
case incurred in the ordinary course of business, and (ii) make other loans and
advances to directors, officers, employees and vendors, (A) so long as, as of
the end of each of the three months preceding such loan or advance and on such
date after taking into account the particular loan or advance and (B) such loans
and advances in the aggregate shall not exceed, $6,000,000 outstanding at any
one time;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) investments in
existence on the date hereof and so long as no Event of Default shall have
occurred and be continuing, or would occur as a consequence thereof, extensions,
renewals, modifications, restatements or replacements thereof so long as the
aggregate dollar amount of all such extensions, renewals, modifications,
restatements, or replacements does not exceed the amount of such investments in
existence on the date hereof;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) so long as no
Event of Default shall have occurred and be continuing, or would occur as a
consequence thereof, Parent may make loans and advances to its Subsidiaries in
the aggregate amount of $5,000,000 outstanding at any one time; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) investments in
Hoop Holdings, LLC, Hoop Retail Stores, LLC or The Disney Store, LLC in
accordance with, and as contemplated in the Acquisition Agreement, the TCP
Guaranty and Commitment (as each of those terms is defined in the Acquisition
Agreement) and the Disney License Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.14 Transactions with Affiliates</B>. Directly or indirectly enter into or
permit to exist any material transaction with any Affiliate of any Borrower
except for: (a) transactions that are in the ordinary course of such Borrower's
business, upon fair and reasonable terms, that are fully disclosed to Agent, and
that are no less favorable to such Borrower than would be obtained in arm's
length transaction with a non-Affiliate, (b) the employment agreement between
Parent and Ezra Dabah, (c) the advisory agreement between Parent and SKM
Investors; (d) transactions in connection with the Disney Stores Acquisition, as
otherwise contemplated by, and specified in this Agreement, (e) payment of
insurance premiums to Twin Brook in an amount not to exceed $750,000 in any
fiscal year, and (f) transactions between Parent and Services Company in the
ordinary course of business.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.15 Suspension</B>. Suspend or go out of a substantial portion of their business.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.16 Use of Proceeds</B>. Use (a) the proceeds of the Advances for any
purpose other than (i) to pay transactional costs and expenses incurred in
connection with this Agreement, (ii)&#160;assuming the Obligations under the
Existing Loan Agreement, (iii) to fund the Disney Stores Acquisition via a
capital contribution at closing of $50,000,000.00; (iv) to fund working capital
in the ordinary course of business; (v) to fund capital expenditures, including
the additional $50,000,000.00 capital contribution to be made pursuant to the
Disney License Agreement and the TCP Guaranty and Commitment (as defined in the
Acquisition Agreement); (vi) to fund the Borrowers&#146; share of the working
capital adjustment to the Walt Disney Companies due in accordance with the
Acquisition Agreement; and (vii)&#160;thereafter, consistent with the terms and
conditions hereof, for its lawful and permitted corporate purposes. In no event
may any proceeds of Advances be used to pay indemnification obligations to the
Walt Disney Companies, as described in Section 7.6, above, in an amount greater
than $25,000,000.00 at any one time or in the aggregate, without the prior
written consent of the Required Lenders.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.17 Change in Location of Chief Executive Office; Inventory and Equipment
with Bailees.</B> Relocate its chief executive office to a new location without
providing 30 days prior written notification thereof to Agent and so long as, at
the time of such written notification, Borrowers provide any financing
statements or fixture filings necessary to perfect and continue perfected the
Lien of Agent (for the benefit of the Lender Group) and also provides to Agent a
Collateral Access Agreement with respect to such new location. The Inventory and
Equipment shall not at any time now or hereafter be stored with a bailee,
warehouseman, or similar party without Agent's prior written consent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.18 No Prohibited Transactions Under ERISA. </B>Directly or indirectly:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) engage, or
permit any Subsidiary of any Borrower to engage, in any prohibited transaction
which is reasonably likely to result in a civil penalty or excise tax described
in <U>Sections 406</U> of ERISA or 4975 of the IRC for which a statutory or
class exemption is not available or a private exemption has not been previously
obtained from the Department of Labor;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) permit to exist
with respect to any Benefit Plan any accumulated funding deficiency (as defined
in <U>Sections 302</U> of ERISA and 412 of the IRC), whether or not
waived;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) fail, or permit
any Subsidiary of any Borrower to fail, to pay timely required contributions or
annual installments due with respect to any waived funding deficiency to any
Benefit Plan;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) terminate, or
permit any Subsidiary of any Borrower to terminate, any Benefit Plan where such
event would result in any liability of any Borrower, any of its Subsidiaries or
any ERISA Affiliate under Title IV of ERISA;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) fail, or permit
any Subsidiary of any Borrower to fail, to make any required contribution or
payment to any Multiemployer Plan;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) fail, or permit
any Subsidiary of any Borrower to fail, to pay any required installment or any
other payment required under <U>Section 412</U> of the IRC on or before the due
date for such installment or other payment;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) amend, or
permit any Subsidiary of any Borrower to amend, a Plan resulting in an increase
in current liability for the plan year such that either of any Borrower, any
Subsidiary of any Borrower or any ERISA Affiliate is required to provide
security to such Plan under <U>Section 401(a)(29)</U> of the IRC; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) withdraw, or
permit any Subsidiary of any Borrower to withdraw, from any Multiemployer Plan
where such withdrawal is reasonably likely to result in any liability of any
such entity under Title IV of ERISA;</FONT></P>

<P><FONT SIZE=3>which, individually or in the aggregate, results in or
reasonably would be expected to result in a claim against or liability of any
Borrower, any of its Subsidiaries or any ERISA Affiliate in excess of $100,000.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.19 Financial Covenants.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Fail to maintain Availability at all times of not less than $14,000,000.00
without regard to the Maximum Amount.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) Fail to
achieve, on and as of December 31, 2004, (i) Availability in an amount not less
than $20,000,000.00, (ii) Revolving Facility Usage of $0.00, and (iii) a
permanent reduction of the outstanding balance of the Temporary Overadvance
Facility to $0.00.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.20 Capital Expenditures</B>. Make capital expenditures (based upon Parent&#146;s
Statement of Cash Flows for Investing Activities, exclusive of non-capital
items) in each of the following Fiscal Years in excess of the applicable amount
set forth below: </FONT></P>

<PRE>

             Fiscal Year Ending                Maximum
             ------------------                --------
             On or About                       Capital Expenditures
             ------------                      --------------------

             January 31, 2005                  $50,000,000.00 (exclusive of the
                                               $50,000,000 capital contribution
             January 31, 2006                  upon closing of the Disney Stores
                                                Acquisition)

                                               $60,000,000.00
</PRE>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Of the foregoing amounts, and of the corresponding amounts agreed to for future
periods that are set forth in the table below, the Borrowers acknowledge and
agree that the respective amounts set forth in the table below opposite each
such period shall only be available for use as investments in Hoop Retail
Stores, LLC or The Disney Store, LLC during that period:</FONT></P>

<PRE>
-------------------------------------------------------------------------------
<B>                                                   Amount to be Preserved
        Period                                 for investments in Hoop Retail
                                               Stores, LLC or The Disney Stores
                                                        N.A., LLC</B>
-------------------------------------------------------------------------------

Closing Date through January 31, 2006                    $10,000,000
-------------------------------------------------------------------------------

February 1, 2006 - January 31, 2007                      $15,000,000
-------------------------------------------------------------------------------

February 1, 2007 - January 31, 2008                      $20,000,000
-------------------------------------------------------------------------------

February 1, 2008 - January 31, 2009                      $15,000,000
-------------------------------------------------------------------------------
</PRE>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Further, if the Borrowers desire during any fiscal period specified in the table
above to expend amounts greater than those provided for such period in the table
above as investments in Hoop Retail Stores, LLC or The Disney Store, LLC, then
as of the date any such additional investment is made, (i) immediately after
giving effect to the proposed investment, and (ii) for a period of Ninety (90)
days thereafter the Borrowers are projected to maintain Availability of not less
than $25,000,000. The Agent agrees that it will not unreasonably withhold its
consent to any requested modification of, or increase to the foregoing terms and
conditions.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3> Agent and Administrative Borrower shall reasonably
agree upon the maximum capital expenditures for the Fiscal Year ending on or
about January&#160;31, 2007 based upon Parent&#146;s Business Plan for such
Fiscal Year.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>8. EVENTS OF DEFAULT</B>. Any one or more of the following events shall
constitute an event of default (each, an "Event of Default") under this
Agreement:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) If any Borrower fails to pay when due and payable or when declared due and
payable, any portion of the Obligations (whether of principal, interest
(including any interest which, but for the provisions of the Bankruptcy Code,
would have accrued on such amounts), fees and charges due the Lender Group,
reimbursement of Lender Group Expenses, or other amounts constituting
Obligations);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) If any Borrower
fails or neglects to perform, keep, or observe any term, provision, condition,
covenant, or agreement contained in this Agreement, in any of the Loan
Documents, or in any other present or future agreement among Borrowers and the
Lender Group; <U>provided</U>, <U>however</U>, that Borrowers' failure or
neglect to comply with <U>Sections 6.1(b)</U>, <U>6.2</U>, <U>6.3</U>,
<U>6.4</U>, <U>6.5</U>, <U>6.6</U>, <U>6.8</U>, <U>6.11</U> and <U>6.13</U>
shall not constitute an Event of Default hereunder unless such failure or
neglect continues for five days or more;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) If there is a
material impairment of the prospect of repayment of any portion of the
Obligations owing to the Lender Group or a material impairment of the value or
priority of the Lender Group's security interests in the Collateral;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) If any material
portion of Borrowers' properties or assets is attached, seized, subjected to a
writ or distress warrant, or is levied upon, or comes into the possession of any
third Person;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) If an
Insolvency Proceeding is commenced by any Borrower;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) If an
Insolvency Proceeding is commenced against any Borrower and any of the following
events occur: (a) such Borrower consents to the institution of the Insolvency
Proceeding against it; (b) the petition commencing the Insolvency Proceeding is
not timely controverted; (c) the petition commencing the Insolvency Proceeding
is not dismissed within 45 calendar days of the date of the filing thereof;
<U>provided</U>, <U>however</U>, that, during the pendency of such period, the Lender Group
shall be relieved of its obligation to extend credit hereunder; (d) an interim
trustee is appointed to take possession of all or a substantial portion of the
properties or assets of, or to operate all or any substantial portion of the
business of, such Borrower; or (e) an order for relief shall have been issued or
entered therein;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) If any Borrower
is enjoined, restrained, or in any way prevented by court order from continuing
to conduct all or any material part of its business affairs;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) If a notice of
Lien, levy, or assessment is filed of record with respect to any of any
Borrower's properties or assets by the United States Government, or any
department, agency, or instrumentality thereof, or by any state, county,
municipal, or governmental agency, or if any taxes or debts owing at any time
hereafter to any one or more of such entities becomes a Lien, whether choate or
otherwise, upon any of any Borrower's properties or assets and the same is not
paid on the payment date thereof;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) If (a) an
action or proceeding is brought against any Borrower which is reasonably likely
to be decided adversely to such Borrower, and such adverse decision would
materially impair the prospect of repayment of the Obligations or materially
impair the value or priority of the Lender Group's security interests in the
Collateral, or (b) if a judgment or other claim in excess of $500,000 becomes a
lien or encumbrance upon any material portion of Borrower's properties or assets
and shall remain outstanding 30 days or longer;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (j) If there is a
default in an agreement involving Indebtedness of $500,000, or more, or any
material agreement to which any Borrower is a party with one or more third
Persons resulting in a right by such third Persons, irrespective of whether
exercised, to accelerate the maturity of such Borrower's obligations thereunder;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (k) If any Borrower
makes any payment on account of Indebtedness that has been contractually
subordinated in right of payment to the payment of the Obligations, except to
the extent such payment is permitted by the terms of the subordination
provisions applicable to such Indebtedness;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (l) If any material
misstatement or misrepresentation exists now or hereafter in any warranty,
representation, statement, or report made to the Lender Group by any Borrower or
any officer, employee, agent, or director of any Borrower, or if any such
warranty or representation is withdrawn; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (m) If the
obligation of any guarantor under its guaranty or other third Person under any
Loan Document is limited or terminated by operation of law or by the guarantor
or other third Person thereunder, or any such guarantor or other third Person
becomes the subject of an Insolvency Proceeding.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>9. THE LENDER GROUP'S RIGHTS AND REMEDIES.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>9.1 Rights and Remedies</B>. Upon the occurrence, and during the continuation, of
an Event of Default Agent may, pursuant to <U>Sections 17.4</U> and <U>17.5</U>,
without notice of its election and without demand, do any one or more of the
following, all of which are authorized by Borrowers:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Declare all Obligations, whether evidenced by this Agreement, by any of the
other Loan Documents, or otherwise, immediately due and payable;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) Cease advancing money or extending credit to or for the benefit of Borrowers
under this Agreement, under any of the Loan Documents, or under any other
agreement between Borrower and the Lender Group;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) Terminate this Agreement and any of the other Loan Documents as to any
future liability or obligation of the Lender Group, but without affecting the
Lender Group's rights and security interests in the Collateral and without
affecting the Obligations;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d) Settle or adjust disputes and claims directly with Account Debtors for
amounts and upon terms which Agent considers advisable, and in such cases, Agent
will credit Borrowers' Loan Account with only the net amounts received by Agent
in payment of such disputed Accounts after deducting all Lender Group Expenses
incurred or expended in connection therewith;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(e) Cause Borrowers to hold all returned Inventory in trust for the Lender
Group, segregate all returned Inventory from all other property of Borrowers or
in Borrowers' possession and conspicuously label said returned Inventory as the
property of the Lender Group;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(f) Without notice to or demand upon Borrowers or any guarantor, make such
payments and do such acts as Agent considers necessary or reasonable to protect
its security interests in the Collateral. Each Borrower agrees to assemble the
Collateral if Agent so requires, and to make the Collateral available to Agent
as Agent may designate. Each Borrower authorizes Agent to enter the premises
where the Collateral is located, to take and maintain possession of the
Collateral, or any part of it, and to pay, purchase, contest, or compromise any
encumbrance, charge, or Lien that in Agent's determination appears to conflict
with the Liens of Agent (for the benefit of the Lender Group) in the Collateral
and to pay all expenses incurred in connection therewith. With respect to any of
Borrowers' owned or leased premises, Borrowers hereby grant Agent a license to
enter into possession of such premises and to occupy the same, without charge,
for up to 120 days in order to exercise any of the Lender Group's rights or
remedies provided herein, at law, in equity, or otherwise;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(g) Without notice to Borrowers (such notice being expressly waived), and
without constituting a retention of any collateral in satisfaction of an
obligation (within the meaning of Section 9505 of the Code), set off and apply
to the Obligations any and all (i) balances and deposits of Borrowers held by
the Lender Group (including any amounts received in the Lockbox Accounts), or
(ii) indebtedness at any time owing to or for the credit or the account of
Borrower held by the Lender Group;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(h) Hold, as cash collateral, any and all balances and deposits of Borrowers
held by the Lender Group, and any amounts received in the Lockbox Accounts, to
secure the full and final repayment of all of the Obligations;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Ship, reclaim, recover, store, finish, maintain, repair, prepare for sale,
advertise for sale, and sell (in the manner provided for herein) the Collateral.
Agent is hereby granted a license or other right to use, without charge,
Borrowers' labels, patents, copyrights, rights of use of any name, trade
secrets, trade names, trademarks, service marks, and advertising matter, or any
property of a similar nature, as it pertains to the Collateral, in completing
production of, advertising for sale, and selling any Collateral and Borrowers'
rights under all licenses and all franchise agreements shall inure to the Lender
Group's benefit;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(j) Sell the Collateral at either a public or private sale, or both, by way of
one or more contracts or transactions, for cash or on terms, in such manner and
at such places (including Borrowers' premises) as Agent determines is
commercially reasonable. It is not necessary that the Collateral be present at
any such sale;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(k) Agent shall give notice of the disposition of the Collateral as follows:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(A) Agent shall give Administrative Borrower and each holder of a security
interest in the Collateral who has filed with Agent a written request for
notice, a notice in writing of the time and place of public sale, or, if the
sale is a private sale or some other disposition other than a public sale is to
be made of the Collateral, then the time on or after which the private sale or
other disposition is to be made;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(B) The notice shall be personally delivered or mailed, postage prepaid, to
Administrative Borrower as provided in <U>Section&#160;12</U>, at least 10 days
before the date fixed for the sale, or at least 10 days before the date on or
after which the private sale or other disposition is to be made; no notice needs
to be given prior to the disposition of any portion of the Collateral that is
perishable or threatens to decline speedily in value or that is of a type
customarily sold on a recognized market. Notice to Persons other than Borrowers
claiming an interest in the Collateral shall be sent to such addresses as they
have furnished to Agent;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT></TD>
<TD WIDTH=85%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(C) If the sale is to be a public sale, Agent also shall give notice of the time
and place by publishing a notice one time at least 10 days before the date of
the sale in a newspaper of general circulation in the county in which the sale
is to be held;</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(l) Agent may credit bid and purchase at any public sale; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(m) Any deficiency that exists after disposition of the Collateral as provided
above will be paid immediately by Borrowers. Any excess will be returned,
without interest and subject to the rights of third Persons, by Agent to
Borrowers.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>9.2 Remedies Cumulative.</B> The Lender Group's rights and remedies under
this Agreement, the Loan Documents, and all other agreements shall be
cumulative. The Lender Group shall have all other rights and remedies not
inconsistent herewith as provided under the Code, by law, or in equity. No
exercise by the Lender Group of one right or remedy shall be deemed an election,
and no waiver by the Lender Group of any Event of Default shall be deemed a
continuing waiver. No delay by the Lender Group shall constitute a waiver,
election, or acquiescence by it.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10. TAXES AND EXPENSES.</B> If Borrowers fail to pay any monies (whether
taxes, assessments, insurance premiums, or, in the case of leased properties or
assets, rents or other amounts payable under such leases) due to third Persons,
or fails to make any deposits or furnish any required proof of payment or
deposit, all as required under the terms of this Agreement, then, to the extent
that Agent determines that such failure by Borrowers could result in a Material
Adverse Change, in its discretion and without prior notice to Borrowers, Agent
may do any or all of the following: (a) make payment of the same or any part
thereof; (b) set up such reserves in Borrowers' Loan Account as Agent deems
necessary to protect the Lender Group from the exposure created by such failure;
or (c) obtain and maintain insurance policies of the type described in <U>Section
6.9</U>, and take any action with respect to such policies as Agent deems prudent.
Any such amounts paid by Agent shall constitute Lender Group Expenses. Any such
payments made by Agent shall not constitute an agreement by the Lender Group to
make similar payments in the future or a waiver by the Lender Group of any Event
of Default under this Agreement. Agent need not inquire as to, or contest the
validity of, any such expense, tax, or Lien and the receipt of the usual
official notice for the payment thereof shall be conclusive evidence that the
same was validly due and owing.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11. WAIVERS; INDEMNIFICATION.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.1 Demand; Protest; etc.</B> Each Borrower waives demand, protest, notice
of protest, notice of default or dishonor, notice of payment and nonpayment,
nonpayment at maturity, release, compromise, settlement, extension, or renewal
of accounts, documents, instruments, chattel paper, and guarantees at any time
held by the Lender Group on which such Borrower may in any way be liable.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.2 The Lender Group's Liability for Collateral</B>. So long as the Lender Group
complies with its obligations, if any, under Section 9207 of the Code, the
Lender Group shall not in any way or manner be liable or responsible for: (a)
the safekeeping of the Collateral; (b) any loss or damage thereto occurring or
arising in any manner or fashion from any cause; (c) any diminution in the value
thereof; or (d) any act or default of any carrier, warehouseman, bailee,
forwarding agency, or other Person. All risk of loss, damage, or destruction of
the Collateral shall be borne by Borrowers.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.3 Indemnification</B>. Each Borrower shall pay, indemnify, defend, and hold each
Agent-Related Person, each Lender, each Participant, and each of their
respective officers, directors, employees, counsel, agents, and
attorneys-in-fact (each, an &quot;Indemnified Person&quot;) harmless (to the
fullest extent permitted by law) from and against any and all claims, demands,
suits, actions, investigations, proceedings, and damages, and all reasonable
attorneys fees and disbursements and other costs and expenses actually incurred
in connection therewith (as and when they are incurred and irrespective of
whether suit is brought), at any time asserted against, imposed upon, or
incurred by any of them in connection with or as a result of or related to the
execution, delivery, enforcement, performance, and administration of this
Agreement and any other Loan Documents or the transactions contemplated herein,
and with respect to any investigation, litigation, or proceeding related to this
Agreement, any other Loan Document, or the use of the proceeds of the credit
provided hereunder (irrespective of whether any Indemnified Person is a party
thereto), or any act, omission, event or circumstance in any manner related
thereto (all the foregoing, collectively, the &quot;Indemnified
Liabilities&quot;). Each Borrower shall have no obligation to any Indemnified
Person under this <U>Section&#160;11.3</U> with respect to any Indemnified
Liability that a court of competent jurisdiction finally determines to have
resulted from the gross negligence or willful misconduct of such Indemnified
Person. This provision shall survive the termination of this Agreement and the
repayment of the Obligations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>12. NOTICES.</B> Unless otherwise provided in this Agreement, all notices or
demands by any party relating to this Agreement or any other Loan Document shall
be in writing and (except for financial statements and other informational
documents which may be sent by first-class mail, postage prepaid) shall be
personally delivered or sent by registered or certified mail (postage prepaid,
return receipt requested), overnight courier, or telefacsimile to Administrative
Borrower or to Agent, as the case may be, at its address set forth below:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT><B>If to Administrative<BR>
Borrower:</B></TD>
<TD WIDTH=50%><B>THE CHILDREN'S PLACE RETAIL STORES, INC.</B><BR>
915 Secaucus Road<BR>
Secaucus, New Jersey  07094<BR>
Attn:    Chief Financial Officer<BR>
Fax No. 201.558.2837</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT></TD>
<TD WIDTH=50%><B>THE CHILDREN'S PLACE RETAIL STORES, INC.</B><BR>
915 Secaucus Road<BR>
Secaucus, New Jersey  07094<BR>
Attn:    General Counsel<BR>
Fax No. 201.558.2840</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT><B>with copies to:</B></TD>
<TD WIDTH=50%><B>STROOCK &amp; STROOCK &amp; LAVAN LLP</B><BR>
180 Maiden Lane<BR>
New York, New York 10038<BR>
Attn:    Jeffrey S. Lowenthal, Esq.<BR>
Fax No. 212.806.6006</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT><B>If to Agent or the<BR>
Lender Group in case<BR>
of Agent:</B></TD>
<TD WIDTH=50%><B>WELLS FARGO RETAIL FINANCE, LLC</B><BR>
One Boston Place<BR>
Suite 1800<BR>
Boston, Massachusetts  02108<BR>
Attn:    David Molinario<BR>
Fax No. 617.523.4027</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT><B>with copies to:</B></TD>
<TD WIDTH=50%><B>RIEMER &amp; BRAUNSTEIN LLP</B><BR>
Three Center Plaza<BR>
Boston, Massachusetts 02108<BR>
Attn:    Donald E. Rothman, Esq.<BR>
Fax No. 617 880 3456</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>The parties hereto may change the address at which
they are to receive notices hereunder, by notice in writing in the foregoing
manner given to the other. All notices or demands sent in accordance with this
<U>Section 12</U>, other than notices by Agent in connection with
Sections&#160;9611 or 9620 of the Code, shall be deemed received on the earlier
of the date of actual receipt or three days after the deposit thereof in the
mail. Borrowers acknowledge and agree that notices sent by Agent in connection
with Sections&#160;9611 or 9620 of the Code shall be deemed sent when deposited
in the mail or personally delivered, or, where permitted by law, transmitted by
telefacsimile or other similar method set forth above.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER. THE VALIDITY OF THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN
ANOTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF
AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO
ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO SHALL
BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF CALIFORNIA. THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS
ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE
TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA OR, AT THE SOLE OPTION OF THE LENDER GROUP,
IN ANY OTHER COURT IN WHICH THE LENDER GROUP SHALL INITIATE LEGAL OR EQUITABLE
PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN
CONTROVERSY. BORROWER AND EACH MEMBER OF THE LENDER GROUP WAIVES, TO THE EXTENT
PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE
OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS
BROUGHT IN ACCORDANCE WITH THIS SECTION 13. EACH BORROWER AND EACH MEMBER OF THE
LENDER GROUP HEREBY WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF
THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH
BORROWER AND EACH MEMBER OF THE LENDER GROUP REPRESENTS THAT IT HAS REVIEWED
THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14. DESTRUCTION OF BORROWER'S DOCUMENTS</B>. All documents, schedules,
invoices, agings, or other papers delivered to Agent may be destroyed or
otherwise disposed of by Agent four months after they are delivered to or
received by Agent, unless Administrative Borrower requests, in writing, the
return of said documents, schedules, or other papers and makes arrangements, at
Borrowers' expense, for their return.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS</B>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.1 Assignments and Participations</B>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Any Lender may, with the written consent of Agent (and, if no Event of
Default then exists and is continuing, the Administrative Borrower (whose
consent shall not be unreasonably withheld)) assign and delegate to one or more
Eligible Transferees (each an "Assignee") all, or any ratable part, of the
Obligations, the Commitments, and the other rights and obligations of such
Lender hereunder and under the other Loan Documents, in a minimum amount of
$5,000,000; provided, however, that Borrowers and Agent may continue to deal
solely and directly with such Lender in connection with the interest so assigned
to an Assignee until (i) written notice of such assignment, together with
payment instructions, addresses, and related information with respect to the
Assignee, shall have been given to Administrative Borrower and Agent by such
Lender and the Assignee; (ii) such Lender and its Assignee shall have delivered
to Administrative Borrower and Agent a fully executed Assignment and Acceptance
("Assignment and Acceptance") in the form of Exhibit A-1; and (iii) the assignor
Lender or Assignee has paid to Agent for Agent's sole and separate account a
processing fee in the amount of $5,000. Anything contained herein to the
contrary notwithstanding, the consent of Agent shall not be required (and
payment of any fees shall not be required) if such assignment is in connection
with any merger, consolidation, sale, transfer, or other disposition of all or
any substantial portion of the business or loan portfolio of such Lender.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) From and after
the date that Agent notifies the assignor Lender that it has received a fully
executed Assignment and Acceptance and payment of the above-referenced
processing fee, (i) the Assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment and Acceptance, shall have the rights and obligations of a
Lender under the Loan Documents, and (ii) the assignor Lender shall, to the
extent that rights and obligations hereunder and under the other Loan Documents
have been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under this Agreement (and in the
case of an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender's rights and obligations under this Agreement and the other
Loan Documents, such Lender shall cease to be a party hereto and thereto), and
such assignment shall effect a novation between Borrowers and the Assignee.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) By executing
and delivering an Assignment and Acceptance, the assigning Lender thereunder and
the Assignee thereunder confirm to and agree with each other and the other
parties hereto as follows: (1) other than as provided in such Assignment and
Acceptance, such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties, or
representations made in or in connection with this Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency, or value of this
Agreement or any other Loan Document furnished pursuant hereto; (2) such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrowers or any
guarantor or the performance or observance by Borrowers or any guarantor of any
of its obligations under this Agreement or any other Loan Document furnished
pursuant hereto; (3) such Assignee confirms that it has received a copy of this
Agreement, together with such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (4) such Assignee will, independently and without
reliance upon Agent, such assigning Lender, 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
this Agreement; (5) such Assignee appoints and authorizes Agent to take such
action as agent on its behalf and to exercise such powers under this Agreement
as are delegated to Agent by the terms hereof, together with such powers as are
reasonably incidental thereto; and (6) such Assignee agrees that it will perform
in accordance with their terms all of the obligations which by the terms of this
Agreement are required to be performed by it as a Lender.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) Immediately
upon each Assignee's making its processing fee payment under the Assignment and
Acceptance, this Agreement shall be deemed to be amended to the extent, but only
to the extent, necessary to reflect the addition of the Assignee and the
resulting adjustment of the Commitments of the Assignor and Assignee arising
therefrom. The Commitment allocated to each Assignee shall reduce such
Commitment of the assigning Lender pro tanto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) Any Lender may
at any time, with the written consent of Agent, which consent shall not be
unreasonably withheld, (and, if no Event of Default then exists and is
continuing, the Administrative Borrower (whose consent shall not be unreasonably
withheld)) sell to one or more Persons (a "Participant") participating interests
in the Obligations, the Commitment, and the other rights and interests of that
Lender (the "Originating Lender") hereunder and under the other Loan Documents;
<U>provided</U>, <U>however</U>, that (i) the Originating Lender's obligations
under this Agreement shall remain unchanged, (ii) the Originating Lender shall
remain solely responsible for the performance of such obligations, (iii)
Borrower and Agent shall continue to deal solely and directly with the
Originating Lender in connection with the Originating Lender's rights and
obligations under this Agreement and the other Loan Documents, (iv) no
Originating Lender shall transfer or grant any participating interest under
which the Participant has the sole and exclusive right to approve any amendment
to, or any consent or waiver with respect to, this Agreement or any other Loan
Document, except to the extent such amendment to, or consent or waiver with
respect to this Agreement or of any other Loan Document would (A) extend the
final maturity date of the Obligations hereunder in which such participant is
participating; (B) reduce the interest rate applicable to the Obligations
hereunder in which such Participant is participating; (C) release all or a
material portion of the Collateral (except to the extent expressly provided
herein or in any of the Loan Documents) supporting the Obligations hereunder in
which such Participant is participating; (D) postpone the payment of, or reduce
the amount of, the interest or fees hereunder in which such Participant is
participating; or (E) change the amount or due dates of scheduled principal
repayments or prepayments or premiums in respect of the Obligations hereunder in
which such Participant is participating; and (v) all amounts payable by
Borrowers hereunder shall be determined as if such Originating Lender had not
sold such participation; except that, if amounts outstanding under this
Agreement are due and unpaid, or shall have been declared or shall have become
due and payable upon the occurrence of an Event of Default, each Participant
shall be deemed to have the right of set-off in respect of its participating
interest in amounts owing under this Agreement to the same extent as if the
amount of its participating interest were owing directly to it as a Lender under
this Agreement; <U>provided</U>, <U>however</U>, that no Participant may
exercise any such right of setoff without the notice to and consent of Agent.
The rights of any Participant shall only be derivative through the Originating
Lender with whom such Participant participates and no Participant shall have any
direct rights as to the other Lenders, Agent, Borrowers, the Collections, the
Collateral, or otherwise in respect of the Advances or the Letters of Credit. No
Participant shall have the right to participate directly in the making of
decisions by the Lenders among themselves. The provisions of this <U>Section
15.1(e)</U> are solely for the benefit of the Lender Group, and Borrowers shall
have no rights as a third party beneficiary of any of such
provisions.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) In connection
with any such assignment or participation or proposed assignment or
participation, a Lender may disclose to a third party all documents and
information which it now or hereafter may have relating to Borrowers or
Borrowers' business.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) Notwithstanding
any other provision in this Agreement, (i) any Lender may at any time create a
security interest in, or pledge, all or any portion of its rights under and
interest in this Agreement in favor of any Federal Reserve Bank in accordance
with Regulation A of the FRB or U.S. Treasury Regulation 31 CFRss.203.14, and
such Federal Reserve Bank may enforce such pledge or security interest in any
manner permitted under applicable law and the Administrative Borrower shall have
no right to consent thereto, and (ii) the Administrative Agent shall not be
entitled to consent to any assignment or participation arising as a result of
the acquisition of a Lender or all or any portion of its loan portfolio by any
other Person.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.2 Successors.</B> This Agreement shall bind and inure to the benefit of the
respective successors and assigns of each of the parties; <U>provided</U>,
<U>however</U>, that Borrowers may not assign this Agreement or any rights or
duties hereunder without the Lenders' prior written consent and any prohibited
assignment shall be absolutely void. No consent to assignment by the Lenders
shall release Borrowers from their Obligations. A Lender may assign this
Agreement and its rights and duties hereunder pursuant to
<U>Section&#160;15.1</U> and, except as expressly required pursuant to
<U>Section&#160;15.1</U>, no consent or approval by Borrowers is required in
connection with any such assignment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16. AMENDMENTS; WAIVERS</B>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.1 Amendments and Waivers</B>.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>No amendment or waiver of any provision of this Agreement or any other Loan
Document, and no consent with respect to any departure by Borrowers therefrom,
shall be effective unless the same shall be in writing and signed by the
Required Lenders (or by Agent at the written request of the Required Lenders)
and Borrowers and then any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no such waiver, amendment, or consent shall, unless in writing and
signed by all the Lenders and Borrowers and acknowledged by Agent, do any of the
following:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) increase or extend the Commitment of any Lender;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) postpone or
delay any date fixed by this Agreement or any other Loan Document for any
payment of principal, interest, fees, or other amounts due to the Lenders (or
any of them) hereunder or under any other Loan Document;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) reduce the
principal of, or the rate of interest specified herein on, any Loan, or any fees
or other amounts payable hereunder or under any other Loan Document;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) change the
percentage of the Commitments or of the aggregate unpaid principal amount of the
Advances, which is required for the Lenders or any of them to take any action
hereunder;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) increase the
advance rate with respect to Advances (except for the restoration of an advance
rate after the prior reduction thereof), or change <U>Section 2.1(b)</U>;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) amend this
Section or any provision of the Agreement providing for consent or other action
by all Lenders;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) release
Collateral other than as permitted by <U>Section 17.11</U>;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) change the
definition of "Required Lenders";</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) release any
Borrower from any Obligation for the payment of money; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (j) amend any of
the provisions of <U>Article 17</U>.</FONT></P>

<P><FONT SIZE=3>and, <U>provided</U> <U>further</U>, that no amendment, waiver
or consent shall, unless in writing and signed by Agent, affect the rights or
duties of Agent under this Agreement or any other Loan Document; and,
<U>provided </U>further, that the limitation contained in clause (e) above shall
not be deemed to limit the ability of Agent to make Advances or Agent Loans, as
applicable, in accordance with the provisions of <U>Sections 2.1(g)</U>,
<U>(h)</U>, or <U>(l)</U>. The foregoing notwithstanding, any amendment,
modification, waiver, consent, termination, or release of or with respect to any
provision of this Agreement or any other Loan Document that relates only to the
relationship of the Lender Group among themselves, and that does not affect the
rights or obligations of Borrowers, shall not require consent by or the
agreement of Borrowers. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.2 No Waivers; Cumulative Remedies.</B> No failure by Agent or any Lender
to exercise any right, remedy, or option under this Agreement, any other Loan
Document, or any present or future supplement hereto or thereto, or in any other
agreement between or among Borrowers and Agent and/or any Lender, or delay by
Agent or any Lender in exercising the same, will operate as a waiver thereof. No
waiver by Agent or any Lender will be effective unless it is in writing, and
then only to the extent specifically stated. No waiver by Agent or the Lenders
on any occasion shall affect or diminish Agent's and each Lender's rights
thereafter to require strict performance by Borrowers of any provision of this
Agreement. Agent's and each Lender's rights under this Agreement and the other
Loan Documents will be cumulative and not exclusive of any other right or remedy
which Agent or any Lender may have.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17. AGENT; THE LENDER GROUP.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17.1 Appointment and Authorization of Agent.</B></FONT></P>

<P><FONT SIZE=3>Each Lender hereby designates and appoints Wells Fargo Retail as
its Agent under this Agreement and the other Loan Documents and each Lender
hereby irrevocably authorizes Agent to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Agent agrees to act as such on the express
conditions contained in this Article&#160;17. The provisions of this
Article&#160;17 are solely for the benefit of Agent and the Lenders, and
Borrowers shall not have any rights as a third party beneficiary of any of the
provisions contained herein; provided, however, that the provisions of
Sections&#160;17.10, 17.11, and 17.16(d) also shall be for the benefit of
Borrowers. Any provision to the contrary contained elsewhere in this Agreement
or in any other Loan Document notwithstanding, Agent shall not have any duties
or responsibilities, except those expressly set forth herein, nor shall Agent
have or be deemed to have any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations, or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against Agent. Except as expressly otherwise provided in this
Agreement, Agent shall have and may use its sole discretion with respect to
exercising or refraining from exercising any discretionary rights or taking or
refraining from taking any actions which Agent is expressly entitled to take or
assert under or pursuant to this Agreement and the other Loan Documents,
including making the determinations contemplated by Section&#160;2.1(b). Without
limiting the generality of the foregoing, or of any other provision of the Loan
Documents that provides rights or powers to Agent, Lenders agree that Agent
shall have the right to exercise the following powers as long as this Agreement
remains in effect: (a) maintain, in accordance with its customary business
practices, ledgers and records reflecting the status of the Advances, the
Collateral, the Collections, and related matters; (b) execute and/or file any
and all financing or similar statements or notices, amendments, renewals,
supplements, documents, instruments, proofs of claim for Lenders, notices and
other written agreements with respect to the Loan Documents; (c) make Advances
for itself or on behalf of Lenders as provided in the Loan Documents; (d)
exclusively receive, apply, and distribute the Collections as provided in the
Loan Documents; (e) open and maintain such bank accounts and lock boxes as Agent
deems necessary and appropriate in accordance with the Loan Documents for the
foregoing purposes with respect to the Collateral and the Collections; (f)
perform, exercise, and enforce any and all other rights and remedies of the
Lender Group with respect to Borrowers, the Advances, the Collateral, the
Collections, or otherwise related to any of same as provided in the Loan
Documents; and (g) incur and pay such Lender Group Expenses as Agent may deem
necessary or appropriate for the performance and fulfillment of its functions
and powers pursuant to the Loan Documents. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.2</B>
<B>Delegation of Duties.</B> Except as otherwise provided in this Section, Agent
may execute any of its duties under this Agreement or any other Loan Document by
or through agents, employees, or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. Agent shall
not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects as long as such selection was made in
compliance with this Section and without gross negligence or willful misconduct.
The foregoing notwithstanding, Agent shall not make any material delegation of
duties to subagents or non-employee delegees without the prior written consent
of Required Lenders (it being understood that routine delegation of such
administrative matters as filing financing statements, or conducting appraisals
or audits, is not viewed as a material delegation that requires prior Required
Lender approval). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.3</B>
<B>Liability of Agent-Related Persons.</B> None of the Agent-Related Persons
shall (i) be liable for any action taken or omitted to be taken by any of them
under or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or, (ii) be responsible in any manner to any of the Lenders for any
recital, statement, representation or warranty made by Borrowers, or any
Subsidiary or Affiliate of Borrowers, or any officer or director thereof,
contained in this Agreement or in any other Loan Document, or in any
certificate, report, statement, or other document referred to or provided for
in, or received by Agent under or in connection with, this Agreement or any
other Loan Document, or the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document, or for any failure
of Borrowers or any other party to any Loan Document to perform its obligations
hereunder or thereunder. No Agent-Related Person shall be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Loan Document, or to inspect the properties, books, or records of
Borrowers, or any of Borrowers' Subsidiaries or Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.4</B>
<B>Reliance by Agent.</B> Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex, or telephone
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent, or made by the proper Person
or Persons, and upon advice and statements of legal counsel (including counsel
to Borrowers or counsel to any Lender), independent accountants, and other
experts selected by Agent. Agent shall be fully justified in failing or refusing
to take any action under this Agreement or any other Loan Document unless it
shall first receive such advice or concurrence of the Required Lenders or all
Lenders, as applicable, and until such instructions are received, Agent shall
act, or refrain from acting, as it deems advisable so long as it is not grossly
negligent or guilty of willful misconduct. If Agent so requests, it shall first
be indemnified to its reasonable satisfaction by Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Agent shall in all cases be fully protected
in acting, or in refraining from acting, under this Agreement or any other Loan
Document in accordance with a request or consent of the Required Lenders or all
Lenders, as applicable, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all of the Lenders. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.5</B>
<B>Notice of Default or Event of Default.</B> Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default, except
with respect to defaults in the payment of principal, interest, fees, and
expenses required to be paid to Agent for the account of Agent or the Lenders,
except with respect to actual knowledge of the existence of an Overadvance, and
except with respect to Defaults and Events of Default of which Agent has actual
knowledge, unless Agent shall have received written notice from a Lender or a
Borrower referring to this Agreement, describing such Default or Event of
Default, and stating that such notice is a &quot;notice of default.&quot; Agent
promptly will notify the Lenders of its receipt of any such notice or of any
Event of Default of which Agent has, or is deemed to have, actual knowledge. If
any Lender obtains actual knowledge of any Event of Default, such Lender
promptly shall notify the other Lenders and Agent of such Event of Default. Each
Lender shall be solely responsible for giving any notices to its Participants,
if any. Subject to <U>Section 17.4</U>, Agent shall take such action with
respect to such Default or Event of Default as may be requested by the Required
Lenders; <U>provided</U>, <U>however</U>, that: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) At all times,
Agent may propose and, with the consent of Required Lenders (which shall not be
unreasonably withheld and which shall be deemed to have been given by a Lender
unless such Lender has notified Agent to the contrary in writing within three
days of notification of such proposed actions by Agent) exercise, any remedies
on behalf of the Lender Group; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) At all times,
once Required Lenders or all Lenders, as the case may be, have approved the
exercise of a particular remedy or pursuit of a course of action, Agent may, but
shall not be obligated to, make all administrative decisions in connection
therewith or take all other actions reasonably incidental thereto (for example,
if the Required Lenders approve the foreclosure of certain Collateral, Agent
shall not be required to seek consent for the administrative aspects of
conducting such sale or handling of such Collateral).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.6</B>
<B>Credit Decision.</B> Each Lender acknowledges that none of the Agent-Related
Persons has made any representation or warranty to it, and that no act by Agent
hereinafter taken, including any review of the affairs of Borrowers and their
Subsidiaries or Affiliates, shall be deemed to constitute any representation or
warranty by any Agent-Related Person to any Lender. Each Lender represents to
Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition, and creditworthiness of
Borrowers and any other Person (other than the Lender Group) party to a Loan
Document, and all applicable bank regulatory laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to Borrowers. Each Lender also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals, and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition, and
creditworthiness of Borrowers, and any other Person (other than the Lender
Group) party to a Loan Document. Except for notices, reports, and other
documents expressly herein required to be furnished to the Lenders by Agent,
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition, or creditworthiness of Borrowers, and
any other Person party to a Loan Document that may come into the possession of
any of the Agent-Related Persons. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.7
Costs and Expenses; Indemnification.</B> Agent may incur and pay Lender Group
Expenses to the extent Agent deems reasonably necessary or appropriate for the
performance and fulfillment of its functions, powers, and obligations pursuant
to the Loan Documents, including without limiting the generality of the
foregoing, but subject to any requirements of the Loan Documents that it obtain
any applicable consents or engage in any required consultation, court costs,
reasonable attorneys fees and expenses, costs of collection by outside
collection agencies and auctioneer fees and costs of security guards or
insurance premiums paid to maintain the Collateral, whether or not Borrowers are
obligated to reimburse Agent or Lenders for such expenses pursuant to the Loan
Agreement or otherwise. Agent is authorized and directed to deduct and retain
sufficient amounts from Collections to reimburse Agent for such out-of-pocket
costs and expenses prior to the distribution of any amounts to Lenders. In the
event Agent is not reimbursed for such costs and expenses from Collections, each
Lender hereby agrees that it is and shall be obligated to pay to or reimburse
Agent for the amount of such Lender's Pro Rata Share thereof. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand the Agent-Related Persons (to the extent not reimbursed by or on
behalf of Borrowers and without limiting the obligations of Borrowers to do so),
according to their Pro Rata Shares, from and against any and all Indemnified
Liabilities; <U>provided</U>, <U>however</U>, that no Lender shall be liable for
the payment to the Agent-Related Persons of any portion of such Indemnified
Liabilities resulting solely from such Person's gross negligence, bad faith, or
willful misconduct. Without limitation of the foregoing, each Lender shall
reimburse Agent upon demand for its ratable share of any costs or out-of-pocket
expenses (including attorney fees and expenses) incurred by Agent in connection
with the preparation, execution, delivery, administration, modification,
amendment, or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement, any other Loan Document, or any document contemplated by or
referred to herein, to the extent that Agent is not reimbursed for such expenses
by or on behalf of Borrowers. The undertaking in this <U>Section&#160;17.7</U>
shall survive the payment of all Obligations hereunder and the resignation or
replacement of Agent. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.8
Agent in Individual Capacity.</B> Wells Fargo Retail and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests, in and generally engage in any kind of banking, trust,
financial advisory, underwriting, or other business with Borrowers and its
Subsidiaries and Affiliates and any other Person party to any Loan Documents as
though Wells Fargo Retail were not Agent hereunder without notice to or consent
of the Lenders. The Lenders acknowledge that, pursuant to such activities, Wells
Fargo Retail and its Affiliates may receive information regarding Borrowers or
their Affiliates and any other Person party to any Loan Documents that is
subject to confidentiality obligations in favor of Borrowers or such other
Person and that prohibit the disclosure of such information to the Lenders, and
the Lenders acknowledge that, in such circumstances (and in the absence of a
waiver of such confidentiality obligations, which waiver Agent will use its
reasonable best efforts to obtain), Agent shall be under no obligation to
provide such information to them. With respect to the Agent Loans and Agent
Advances, Wells Fargo Retail shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though it were not
Agent, and the terms &quot;Lender&quot; and &quot;Lenders&quot; include Wells
Fargo Retail in its individual capacity. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.9
Successor Agent.</B> Agent may resign as Agent following notice of such
resignation (&quot;Notice&quot;) to the Lenders and Administrative Borrower, and
effective upon the appointment of and acceptance of such appointment by, a
successor Agent. If Agent resigns under this Agreement, the Required Lenders
shall appoint any Lender or Eligible Transferee as successor Agent for the
Lenders. If no successor Agent is appointed within 30 days of such retiring
Agent's Notice, Agent may appoint a successor Agent, after consulting with the
Lenders and Administrative Borrower. In any such event, upon the acceptance of
its appointment as successor Agent hereunder, such successor Agent shall succeed
to all the rights, powers and duties of the retiring Agent and the term
&quot;Agent&quot; shall mean such successor Agent and the retiring Agent's
appointment, powers, and duties as Agent shall be terminated. After any retiring
Agent's resignation hereunder as Agent, the provisions of this
<U>Section&#160;17</U> shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent under this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17.10 Withholding Tax.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If any Lender is
a "foreign corporation, partnership or trust" within the meaning of the IRC and
such Lender claims exemption from, or a reduction of, U.S. withholding tax under
Sections 1441 or 1442 of the IRC, such Lender agrees with and in favor of Agent
and Borrowers, to deliver to Agent and Borrowers:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) if such Lender
claims an exemption from, or a reduction of, withholding tax under a United
States tax treaty, properly completed IRS Form W-8BEN before the payment of any
interest in the first calendar year and before the payment of any interest in
each third succeeding calendar year during which interest may be paid under this
Agreement;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) if such Lender
claims that interest paid under this Agreement is exempt from United States
withholding tax because it is effectively connected with a United States trade
or business of such Lender, two properly completed and executed copies of IRS
Form W-8ECI before the payment of any interest is due in the first taxable year
of such Lender and in each succeeding taxable year of such Lender during which
interest may be paid under this Agreement, and IRS Form W-9; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) such other
form or forms as may be required under the IRC or other laws of the United
States as a condition to exemption from, or reduction of, United States
withholding tax.</FONT></P>

<P><FONT SIZE=3>Such Lender agrees to promptly notify Agent and Borrowers of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If any Lender
claims exemption from, or reduction of, withholding tax under a United States
tax treaty by providing IRS Form W-8BEN and such Lender sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of
Borrowers, such Lender agrees to notify Agent and Borrower of the percentage
amount in which it is no longer the beneficial owner of Obligations of Borrowers
to such Lender. To the extent of such percentage amount, Agent and Borrowers
will treat such Lender's IRS Form W-8BEN as no longer valid.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If any Lender
claiming exemption from United States withholding tax by filing IRS Form W-8ECI
with Agent sells, assigns, grants a participation in, or otherwise transfers all
or part of the Obligations of Borrowers to such Lender, such Lender agrees to
undertake sole responsibility for complying with the withholding tax
requirements imposed by Sections 1441 and 1442 of the IRC.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If any Lender is
entitled to a reduction in the applicable withholding tax, Agent may withhold
from any interest payment to such Lender an amount equivalent to the applicable
withholding tax after taking into account such reduction. If the forms or other
documentation required by subsection (a) of this Section are not delivered to
Agent, then Agent may withhold from any interest payment to such Lender not
providing such forms or other documentation an amount equivalent to the
applicable withholding tax.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) If the IRS or
any other Governmental Authority of the United States or other jurisdiction
asserts a claim that Agent or Borrowers did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form
was not delivered, was not properly executed, or because such Lender failed to
notify Agent and Borrowers of a change in circumstances which rendered the
exemption from, or reduction of, withholding tax ineffective, or for any other
reason) such Lender shall indemnify Agent and Borrowers fully for all amounts
paid, directly or indirectly, by Agent or Borrowers as tax or otherwise,
including penalties and interest, and including any taxes imposed by any
jurisdiction on the amounts payable to Agent or Borrowers under this Section,
together with all costs and expenses (including attorneys fees and expenses).
The obligation of the Lenders under this subsection shall survive the payment of
all Obligations and the resignation of Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17.11 Collateral Matters.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Lenders
hereby irrevocably authorize Agent, to release any Lien on any Collateral (i)
upon the termination of the Commitments and payment and satisfaction in full by
Borrowers of all Obligations; and upon such termination and payment Agent shall
deliver to Administrative Borrower, at Administrative Borrower's sole cost and
expense, all UCC termination statements and any other documents necessary to
terminate the Loan Documents and release the Liens with respect to the
Collateral; (ii) constituting property being sold or disposed of if a release is
required or desirable in connection therewith and if Administrative Borrower
certifies to Agent that the sale or disposition is permitted under Section 7.4
of this Agreement or the other Loan Documents (and Agent may rely conclusively
on any such certificate, without further inquiry); (iii) constituting property
in which Borrowers owned no interest at the time the Lien was granted or at any
time thereafter; or (iv) constituting property leased to Borrowers under a lease
that has expired or been terminated in a transaction permitted under this
Agreement. Except as provided above, Agent will not release any Lien on any
Collateral without the prior written authorization of the Lenders. Upon request
by Agent or Administrative Borrower at any time, the Lenders will confirm in
writing Agent's authority to release any such Liens on particular types or items
of Collateral pursuant to this Section 17.11; provided, however, that (i) Agent
shall not be required to execute any document necessary to evidence such release
on terms that, in Agent's opinion, would expose Agent to liability or create any
obligation or entail any consequence other than the release of such Lien without
recourse, representation, or warranty, and (ii) such release shall not in any
manner discharge, affect or impair the Obligations or any Liens (other than
those expressly being released), upon (or obligations of Borrowers in respect
of) all interests retained by Borrowers, including, the proceeds of any sale,
all of which shall continue to constitute part of the Collateral.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Agent shall have
no obligation whatsoever to any of the Lenders to assure that the Collateral
exists or is owned by Borrowers, is cared for, protected, or insured or has been
encumbered, or that the Liens of the Agent (for the benefit of the Lender Group)
have been properly or sufficiently or lawfully created, perfected, protected, or
enforced or are entitled to any particular priority, or to exercise at all or in
any particular manner or under any duty of care, disclosure, or fidelity, or to
continue exercising, any of the rights, authorities and powers granted or
available to Agent pursuant to any of the Loan Documents, it being understood
and agreed that in respect of the Collateral, or any act, omission or event
related thereto, subject to the terms and conditions contained herein, Agent may
act in any manner it may deem appropriate, in its sole discretion given Agent's
own interest in the Collateral in its capacity as one of the Lenders and that
Agent shall have no other duty or liability whatsoever to any Lender as to any
of the foregoing, except as otherwise provided herein.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17.12 Restrictions on Actions by Lenders; Sharing of Payments.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each of the
Lenders agrees that it shall not, without the express consent of Agent, and that
it shall, to the extent it is lawfully entitled to do so, upon the request of
Agent, set off against the Obligations any amounts owing by such Lender to
Borrowers or any accounts of Borrower now or hereafter maintained with such
Lender. Each of the Lenders further agrees that it shall not, unless
specifically requested to do so by Agent, take or cause to be taken any action,
including the commencement of any legal or equitable proceedings, to foreclose
any Lien on, or otherwise enforce any security interest in, any of the
Collateral the purpose of which is, or could be, to give such Lender any
preference or priority against the other Lenders with respect to the
Collateral.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subject to
<U>Section 17.8</U>, if, at any time or times any Lender shall receive (i) by payment,
foreclosure, setoff, or otherwise, any proceeds of Collateral or any payments
with respect to the Obligations of Borrowers to such Lender arising under, or
relating to, this Agreement or the other Loan Documents, except for any such
proceeds or payments received by such Lender from Agent pursuant to the terms of
this Agreement, or (ii) payments from Agent in excess of such Lender's Pro Rata
Share of all such distributions by Agent, such Lender shall promptly (1) turn
the same over to Agent, in kind, and with such endorsements as may be required
to negotiate the same to Agent, or in same day funds, as applicable, for the
account of all of the Lenders and for application to the Obligations in
accordance with the applicable provisions of this Agreement, or (2) purchase,
without recourse or warranty, an undivided interest and participation in the
Obligations owed to the other Lenders so that such excess payment received shall
be applied ratably as among the Lenders in accordance with their Pro Rata
Shares; <U>provided</U>, <U>however</U>, that if all or part of such excess payment received
by the purchasing party is thereafter recovered from it, those purchases of
participations shall be rescinded in whole or in part, as applicable, and the
applicable portion of the purchase price paid therefor shall be returned to such
purchasing party, but without interest except to the extent that such purchasing
party is required to pay interest in connection with the recovery of the excess
payment.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.13</B>
<B>Agency for Perfection. </B>Agent and each Lender hereby appoints each other
Lender as agent for the purpose of perfecting the Liens of the Lender Group in
assets which, in accordance with Division 9 of the UCC can be perfected only by
possession. Should any Lender obtain possession of any such Collateral, such
Lender shall notify Agent thereof, and, promptly upon Agent's request therefor
shall deliver such Collateral to Agent or in accordance with Agent's
instructions. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.14</B>
<B>Payments by Agent to the Lenders.</B> All payments to be made by Agent to the
Lenders shall be made by bank wire transfer or internal transfer of immediately
available funds pursuant to the instructions set forth on
<U>Schedule&#160;C-1</U>, or pursuant to such other wire transfer instructions
as each party may designate for itself by written notice to Agent. Concurrently
with each such payment, Agent shall identify whether such payment (or any
portion thereof) represents principal, premium or interest on revolving advances
or otherwise. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.15</B>
<B>Concerning the Collateral and Related Loan Documents.</B> Each member of the Lender
Group authorizes and directs Agent to enter into this Agreement and the other
Loan Documents relating to the Collateral, for the ratable benefit (subject to
<U>Section&#160;4.1</U>) of the Lender Group. Each member of the Lender Group
agrees that any action taken by Agent, Required Lenders, or all Lenders, as
applicable, in accordance with the terms of this Agreement or the other Loan
Documents relating to the Collateral and the exercise by Agent, Required
Lenders, or all Lenders, as applicable, of their respective powers set forth
therein or herein, together with such other powers that are reasonably
incidental thereto, shall be binding upon all of the Lenders. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17.16 Field Audits and Examination Reports; Confidentiality; Disclaimers by
Lenders; Other Reports and Information.</B> By signing this Agreement, each Lender;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) is deemed to
have requested that Agent furnish such Lender, promptly after it becomes
available, a copy of each field audit or examination report (each a "Report" and
collectively, "Reports") prepared by Agent, and Agent shall so furnish each
Lender with such Reports;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) expressly agrees
and acknowledges that Agent (i) does not make any representation or warranty as
to the accuracy of any Report, and (ii) shall not be liable for any information
contained in any Report;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) expressly agrees
and acknowledges that the Reports are not comprehensive audits or examinations,
that Agent or other party performing any audit or examination will inspect only
specific information regarding Borrowers and will rely significantly upon books
and records, as well as on representations of Borrowers' personnel;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) agrees to keep
all Reports and other material information obtained by it pursuant to the
requirements of this Agreement in accordance with its reasonable customary
procedures for handling confidential information; it being understood and agreed
by Borrower that in any event such Lender may make disclosures (i) reasonably
required by any bona fide potential or actual Assignee, transferee, or
Participant in connection with any contemplated or actual assignment or transfer
by such Lender of an interest herein or any participation interest in such
Lender's rights hereunder, (ii) of information that has become public by
disclosures made by Persons other than such Lender, its Affiliates, assignees,
transferees, or participants, or (iii) as required or requested by any court,
governmental or administrative agency, pursuant to any subpoena or other legal
process, or by any law, statute, regulation, or court order; <U>provided</U>,
<U>however</U>, that, unless prohibited by applicable law, statute, regulation,
or court order, such Lender shall notify Administrative Borrower of any request
by any court, governmental or administrative agency, or pursuant to any subpoena
or other legal process for disclosure of any such non-public material
information concurrent with, or where practicable, prior to the disclosure
thereof; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) without limiting
the generality of any other indemnification provision contained in this
Agreement, agrees: (i) to hold Agent and any such other Lender preparing a
Report harmless from any action the indemnifying Lender may take or conclusion
the indemnifying Lender may reach or draw from any Report in connection with any
loans or other credit accommodations that the indemnifying Lender has made or
may make to Borrowers, or the indemnifying Lender's participation in, or the
indemnifying Lender's purchase of, a loan or loans of Borrowers; and (ii) to pay
and protect, and indemnify, defend, and hold Agent and any such other Lender
preparing a Report harmless from and against, the claims, actions, proceedings,
damages, costs, expenses and other amounts (including, attorney costs) incurred
by Agent and any such other Lender preparing a Report as the direct or indirect
result of any third parties who might obtain all or part of any Report through
the indemnifying Lender.</FONT></P>

<P><FONT SIZE=3>In addition to the foregoing: (x) any Lender may from time to
time request of Agent in writing that Agent provide to such Lender a copy of any
report or document provided by Borrowers to Agent, and, upon receipt of such
request, Agent shall provide a copy of same to such Lender promptly upon receipt
thereof; (y) to the extent that Agent is entitled, under any provision of the
Loan Documents, to request additional reports or information from Borrowers, any
Lender may, from time to time, reasonably request Agent to exercise such right
as specified in such Lender's notice to Agent, whereupon Agent promptly shall
request of Borrowers the additional reports or information specified by such
Lender, and, upon receipt thereof, Agent promptly shall provide a copy of same
to such Lender; and (z) any time that Agent renders to Administrative Borrower a
statement regarding the Loan Account, Agent shall send a copy of such statement
to each Lender. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.17</B>
<B>Several Obligations; No Liability.</B> Notwithstanding that certain of the Loan
Documents now or hereafter may have been or will be executed only by or in favor
of Agent in its capacity as such, and not by or in favor of the Lenders, any and
all obligations on the part of Agent (if any) to make any Advances shall
constitute the several (and not joint) obligations of the respective Lenders on
a ratable basis, according to their respective Commitments, to make an amount of
such Advances not to exceed, in principal amount, at any one time outstanding,
the amount of their respective Commitments. Nothing contained herein shall
confer upon any Lender any interest in, or subject any Lender to any liability
for, or in respect of, the business, assets, profits, losses, or liabilities of
any other Lender. Each Lender shall be solely responsible for notifying its
Participants of any matters relating to the Loan Documents to the extent any
such notice may be required, and no Lender shall have any obligation, duty, or
liability to any Participant of any other Lender. Except as provided in
<U>Section 17.7</U>, no member of the Lender Group shall have any liability for
the acts of any other member of the Lender Group. No Lender shall be responsible
to Borrowers or any other Person for any failure by any other Lender to fulfill
its obligations to make Advances, nor to advance for it or on its behalf in
connection with its Commitment, nor to take any other action on its behalf
hereunder or in connection with the financing contemplated herein. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17.18 Documentation Agent; Co-Agent.</B></FONT></P>

<P><FONT SIZE=3>Notwithstanding the provisions of this Agreement or any of the
other Loan Documents, Congress Financial Corporation (New England) (in its
capacity as Documentation Agent, as opposed to its capacity as a Lender), and
LaSalle Retail Finance, a division of LaSalle Business Credit LLC (in its
capacity as Co-Agent, as opposed to its capacity as a Lender) shall have no
powers, rights, duties, responsibilities, or liabilities with respect to this
Agreement and the other Loan Documents, nor shall Congress Financial Corporation
(New England) or LaSalle Retail Finance, a division of LaSalle Business Credit
LLC have or be deemed to have any fiduciary relationship with any Lender.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18. GENERAL PROVISIONS.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18.1 Effectiveness.</B></FONT></P>

<P><FONT SIZE=3>This Agreement shall be binding and deemed effective when
executed by Borrowers and the Lender Group. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18.2</B>
<B>Section Headings.</B> Headings and numbers have been set forth herein for
convenience only. Unless the contrary is compelled by the context, everything
contained in each section applies equally to this entire Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18.3</B>
<B>Interpretation.</B> Neither this Agreement nor any uncertainty or ambiguity herein
shall be construed or resolved against the Lender Group or Borrowers, whether
under any rule of construction or otherwise. On the contrary, this Agreement has
been reviewed by all parties and shall be construed and interpreted according to
the ordinary meaning of the words used so as to fairly accomplish the purposes
and intentions of all parties hereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18.4</B>
<B>Severability of Provisions.</B> Each provision of this Agreement shall be severable
from every other provision of this Agreement for the purpose of determining the
legal enforceability of any specific provision. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18.5</B>
<B>Counterparts; Telefacsimile Execution.</B> This Agreement may be executed in any
number of counterparts and by different parties on separate counterparts, each
of which, when executed and delivered, shall be deemed to be an original, and
all of which, when taken together, shall constitute but one and the same
Agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile shall be equally as effective as delivery of an original executed
counterpart of this Agreement. Any party delivering an executed counterpart of
this Agreement by telefacsimile also shall deliver an original executed
counterpart of this Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18.6</B>
<B>Revival and Reinstatement of Obligations.</B> If the incurrence or payment of the
Obligations by Borrowers or any guarantor of the Obligations or the transfer by
any or all of such parties to the Lender Group of any property of either or both
of such parties should for any reason subsequently be declared to be void or
voidable under any state or federal law relating to creditors' rights, including
provisions of the Bankruptcy Code relating to fraudulent conveyances,
preferences, and other voidable or recoverable payments of money or transfers of
property (collectively, a &quot;Voidable Transfer&quot;), and if the Lender
Group is required to repay or restore, in whole or in part, any such Voidable
Transfer, or elects to do so upon the reasonable advice of its counsel, then, as
to any such Voidable Transfer, or the amount thereof that the Lender Group is
required or elects to repay or restore, and as to all reasonable costs,
expenses, and attorneys fees of the Lender Group related thereto, the liability
of Borrowers or such guarantor automatically shall be revived, reinstated, and
restored and shall exist as though such Voidable Transfer had never been made. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18.7</B>
<B>Integration.</B> This Agreement, together with the other Loan Documents, reflects
the entire understanding of the parties with respect to the transactions
contemplated hereby and shall not be contradicted or qualified by any other
agreement, oral or written, before the date hereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>18.8</B>
<B>Parent as Agent for Borrowers.</B> Each Borrower hereby irrevocably appoints Parent
as the borrowing agent and attorney-in-fact for all Borrowers (the
&#147;Administrative Borrower&#148;) which appointment shall remain in full
force and effect unless and until Agent shall have received prior written notice
signed by each Borrower that such appointment has been revoked and that another
Borrower has been appointed Administrative Borrower. Each Borrower hereby
irrevocably appoints and authorizes the Administrative Borrower (i) to provide
Agent with all notices with respect to Advances and Letters of Credit obtained
for the benefit of any Borrower and all other notices and instructions under
this Agreement and (ii) to take such action as the Administrative Borrower deems
appropriate on its behalf to obtain Advances and Letters of Credit and to
exercise such other powers as are reasonably incidental thereto to carry out the
purposes of this Agreement. It is understood that the handling of the Loan
Account and Collateral of Borrowers in a combined fashion, as more fully set
forth herein, is done solely as an accommodation to Borrowers in order to
utilize the collective borrowing powers of Borrowers in the most efficient and
economical manner and at their request, and that Lender Group shall not incur
liability to any Borrower as a result hereof. Each Borrower expects to derive
benefit, directly or indirectly, from the handling of the Loan Account and the
Collateral in a combined fashion since the successful operation of each Borrower
is dependent on the continued successful performance of the integrated group. To
induce the Lender Group to do so, and in consideration thereof, each Borrower
hereby jointly and severally agrees to indemnify each member of the Lender Group
and hold each member of the Lender Group harmless against any and all liability,
expense, loss or claim of damage or injury, made against the Lender Group by any
Borrower or by any third party whosoever, arising from or incurred by reason of
(a) the handling of the Loan Account and Collateral of Borrowers as herein
provided, (b) the Lender Group's relying on any instructions of the
Administrative Borrower, or (c) any other action taken by the Lender Group
hereunder or under the other Loan Documents, except that Borrowers will have no
liability to the relevant Agent-Related Person or Lender-Related Person under
this <U>Section&#160;18.8</U> with respect to any liability that has been
finally determined by a court of competent jurisdiction to have resulted solely
from the gross negligence or willful misconduct of such Agent-Related Person or
Lender-Related Person, as the case may be. </FONT></P>

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<P><FONT SIZE=3>IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date set forth in the first paragraph of this
Agreement. </FONT></P>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%></TD>
<TD WIDTH=50%><B>THE CHILDREN'S PLACE RETAIL STORES, INC.</B>, a<BR>
Delaware corporation<BR>
<BR>
<BR>
By: <U>/s/ Seth Udasin&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:    Seth Udasin<BR>
Title:   Vice President, Chief Financial<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Officer and Treasurer<BR>
<BR>
<BR>
<B>THE CHILDREN'S PLACE SERVICES COMPANY LLC</B>, a<BR>
Delaware limited liability company<BR>
<BR>
<BR>
By: <U>/s/ Seth Udasin&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:    Seth Udasin<BR>
Title:   Vice President, Chief<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Financial Officer and Treasurer<BR>
<BR>
<BR>
<B>WELLS FARGO RETAIL FINANCE, LLC</B>, a Delaware<BR>
limited liability company, as Agent and as a Lender<BR>
<BR>
By: <U>/s/ David Molinario&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:    David Molinario<BR>
Title:   Vice President<BR>
<BR>
<BR>
<B>CONGRESS FINANCIAL CORPORATION (NEW ENGLAND)</B>, a Massachusetts
corporation, as Documentation<BR>
Agent and as a Lender<BR>
<BR>
By: <U>/s/ Christopher S. Hudik&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:     Christopher S. Hudik<BR>
Title:    First Vice President<BR>
<BR>
<BR>
<B>LASALLE RETAIL FINANCE</B>, a Division<BR>
of LaSalle Business Credit, LLC, as Agent for Standard<BR>
Federal Bank National Association<BR>
<BR>
By: <U>Matthew D. Potter&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:        Matthew D. Potter<BR>
Title:       Assistant Vice President<BR>
<BR>
<BR>
<B>WEBSTER BUSINESS CREDIT CORP.</B>,<BR>
as Assignee of Whitehall Business Credit<BR>
Corporation<BR>
<BR>
By: <U>/s/ Evan Israelson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:        Evan Israelson<BR>
Title:       Vice President</TD>
</TR>
</TABLE>
<BR>

</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<FILENAME>childrens-ex104_120904.htm
<DESCRIPTION>EX-10.4
<TEXT>
<HTML>
<HEAD>
<TITLE>Ex-10.4</TITLE>
</HEAD>
<BODY>

<P ALIGN=CENTER><FONT SIZE=3><B>LICENSE AND CONDUCT OF BUSINESS AGREEMENT</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>dated as of November 21, 2004</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>by and among</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>TDS FRANCHISING, LLC,</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>THE DISNEY STORE, LLC</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>and</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>THE DISNEY STORE (CANADA) LTD.</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>LICENSE AND CONDUCT OF BUSINESS AGREEMENT</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>THIS
LICENSE AND CONDUCT OF BUSINESS AGREEMENT</B> (this
"<B>Agreement</B>"), dated as of November 21, 2004 (the
<B>"Effective Date</B>"), is made and entered into by and among TDS
Franchising, LLC, a California limited liability company
("<B>TDSF</B>"), The Disney Store, LLC, a California limited liability
company ("<B>TDS USA</B>"), and The Disney Store (Canada) Ltd., a
corporation incorporated under the laws of the Province of Ontario ("<B>TDS
Canada</B>" and, together with TDS USA, "<B>Licensee</B>"). Each
of TDSF and Licensee may be referred to herein as a "<B>party</B>" or,
collectively, as the "<B>parties</B>." </FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><U>W</U> <U>I</U> <U>T</U> <U>N</U> <U>E</U> <U>S</U> <U>S</U> <U>E</U> <U>T</U> <U>H</U>:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
pursuant to an Acquisition Agreement, dated as of October 19, 2004 (the
"<B>Acquisition Agreement</B>"), by and among Disney Enterprises, Inc.
("<B>DEI</B>"), Disney Credit Card Services, Inc., Hoop Holdings, LLC,
a Delaware limited liability company ("<B>Licensee Parent</B>"), and
Hoop Canada Holdings, Inc., a Delaware corporation ("<B>Canadian
Parent</B>"), on the date hereof, Licensee Parent is acquiring all of the
equity interests of TDS USA and Canadian Parent is acquiring all of the equity
interests of TDS Canada; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
Licensee is the tenant under certain leases and the owner, lessee or licensee of
various other personal property assets that heretofore have been used in the
operation of a chain of specialty retail stores known as the "<I>Disney
Store</I>"; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
Licensee desires to continue to operate such chain of specialty retail stores in
a form, manner and style as provided for in this Agreement; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
an Affiliate of TDSF has heretofore operated an online retail store located on
the World Wide Web at <U>www.disneystore.com</U>; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
Licensee desires to operate a new online retail store located on the World Wide
Web at www.disneystore.com in a form, manner and style as provided for in this
Agreement; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
in order to enable Licensee to so operate such chain and such online retail
store, Licensee desires to obtain from TDSF, and TDSF desires to grant to
Licensee, certain rights in specified names, marks, symbols, logos, characters
and other proprietary designations and intellectual property owned by or
licensed to TDSF and its Affiliates, all subject to and in strict adherence to
the terms and conditions set forth herein. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, in consideration of the representations, warranties, covenants and
agreements contained herein, the parties agree as follows: </FONT></P>

<P><FONT SIZE=3>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>DEFINITIONS</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
used in this Agreement, the following defined terms shall have the respective
meanings set forth below: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Acquisition
Agreement"</B> shall have the meaning specified in the recitals hereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Action"</B>
shall mean any action, lawsuit, charge, complaint, claim (including a letter
authored by an attorney on behalf of his client alleging a Loss), counterclaim,
arbitration, order, decree, judgment, investigation or other legal,
administrative or Tax proceeding, whether civil or criminal, in law or in
equity, or before any arbitrator or Governmental Entity. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Additional
Merchandise Categories"</B> shall mean any merchandise category, other than
the Pre-Approved Merchandise Categories, as TDSF shall approve in its sole
discretion, which approval shall be sought in accordance with Section 9.19.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Affiliate"</B>
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. For the purposes of this definition, the
term "control" (including, with correlative meanings, the terms
"controlling," "controlled by," and "under common
control with") means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting Securities, by Contract, or otherwise;
<U>provided</U>, that (i) in no event shall Licensee be deemed an Affiliate of
TDSF or vice versa, and (ii) for purposes of this Agreement, in no event shall
any of the following Persons or any of their respective Affiliates be deemed an
Affiliate of TDSF: (A) Euro Disney Investments, Inc., EDL S.N.C. Corporation,
Euro Disney Associes S.N.C., Euro Disneyland SNC, Euro Disney SCA, Euro
Disneyland Participations S.A., Euro Disney S.A., EDL Holding Company, EDL
Participations S.A., Centre de Congres Newport S.A.S., Euro Disneyland
Imagineering S.a.r.l., Societe de Gerance d&#146;Euro Disneyland SA and any
other entity commonly known as "Euro Disney", "Euro
Disneyland" or "Disneyland Resort Paris", and (B) Hongkong
International Theme Parks Limited, Hong Kong Disneyland Management Limited, and
Walt Disney Holdings (Hong Kong) Limited and any other entity commonly known as
"Hong Kong Disney", "Hong Kong Disneyland" or
"Disneyland Resort Hong Kong". </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Agreement"</B>
shall mean this Agreement, by and among the parties as amended, restated and/or
supplemented from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Allocated
Cost Methodology"</B> shall mean a calculation of costs and expenses of
TDSF, its Affiliates and Representatives in accordance with the following:
(a)&#160; personnel of TDSF and/or its Affiliates shall be billed at their
direct costs (<U>i.e.</U>, payroll costs, including payroll taxes and fringe
benefit costs, for both employees and supervisors), plus twenty percent (20%) of
all said direct costs to cover additional overhead; (b)&#160;materials shall be
billed at the net cost to TDSF, its Affiliates and Representatives, plus five
percent (5%) thereof to cover overhead; and (c)&#160;services other than those
of personnel of TDSF and its Affiliates (<U>e.g.</U>, contractors,
subcontractors or other Representatives) shall be billed at TDSF&#146;s or its
Affiliates&#146; costs, plus five percent (5%) thereof to cover overhead. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Annual
Business Plan"</B> shall have the meaning specified in Section 9.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Appeal Notice"</B>
shall have the meaning specified in Section&#160;21.23.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Appellate
Arbitrators"</B> shall have the meaning specified in
Section&#160;21.23.5(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Appraiser"</B>
and <B>"Appraisers"</B> shall have the respective meanings specified
in Section&#160;15.2.1(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Approval
Item"</B> shall have the meaning specified in Section 9.19.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Approval Item
Proposal"</B> shall have the meaning specified in Section 9.19.3(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Approval
Requests"</B> shall have the meaning specified in Section&#160;8.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Approved Template"</B>
shall have the meaning specified in Section&#160;5.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Arbitrable
Disputes"</B> shall have the meaning specified in Section&#160;21.23.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Arbitration
Administrator"</B> shall have the meaning specified in
Section&#160;21.23.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Arbitration
Parties"</B> shall have the meaning specified in Section&#160;21.23.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Arbitrator"</B>
shall have the meaning specified in Section&#160;21.23.5(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Archives
Location"</B> shall mean the physical library or other physical room or
substantially comparable physical location, if any, located at 500 South Buena
Vista Street, Burbank, California (or, if the headquarters of TWDC is moved to
an alternative location, such alternative headquarters of TWDC), at which an
Affiliate of TDSF maintains replicas of consumer products, souvenirs and other
merchandise that principally bear, feature or incorporate one (1) or more
Disney-Branded Properties and are used and maintained for archival purposes. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Article"</B>
shall have the meaning specified in Section&#160;5.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Audit
Firm"</B> shall have the meaning specified in Section&#160;5.1.4(a)(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Average
Royalty Amount"</B> shall have the meaning specified in Section&#160;7.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Bank
One"</B> shall mean, collectively, Bank One, Delaware, N.A., a national
banking association, and Bank One, N.A., a national banking association, and any
successor to either of the foregoing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Bank
One Agreement"</B> shall mean the Co-Branded Credit Card Agreement,
effective as of April 30, 2002, by and between Bank One and Disney Credit Card
Services, Inc., a California corporation. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Banking
Institution"</B> shall mean (i) any national bank or banking institution or
trust company organized under the Laws of the United States or any state or
territory of the United States or the District of Columbia, the business of
which is substantially confined to banking and is supervised by the applicable
federal, state or territorial banking commission or similar official; (ii) a
savings and loan association, building and loan association, cooperative bank,
homestead association or similar institution that is supervised and examined by
state or federal authority having supervision over any such institution; or
(iii) a company that is organized as an insurance company and whose primary and
predominant business activity is the writing of insurance or the reinsuring of
risks underwritten by insurance companies and that is subject to supervision by
the insurance commission or a similar official or agency of a state or territory
or the District of Columbia; <U>provided</U>, that, for purposes of this
Agreement, any Banking Institution that is owned, leased, licensed, controlled
or operated by a Person who would be a Disqualified Person but for subparagraph
(7) of the definition of "Disqualified Person" shall be excluded from
the definition of "Banking Institution." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Banking
Product"</B> shall mean bank savings and checking accounts, certificates of
deposit, home equity loans, mortgages, online banking, student loans, consumer
savings bonds, consumer and small business installment loans and consumer and
small business lines of credit. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Barricade
Procedures"</B> shall have the meaning specified in Section 9.3.1(c). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Board"</B>
shall have the meaning specified in Section&#160;9.13.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Board
Communication"</B> shall have the meaning specified in
Section&#160;9.13.1(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Board
Meetings"</B> shall have the meaning specified in Section&#160;9.13.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Board Observer"</B>
shall have the meaning specified in Section&#160;9.13.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Board
Special Committee Session"</B> shall have the meaning specified in
Section&#160;9.13.1(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Breach
Threshold"</B> shall have the meaning specified in Section&#160;13.14. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Business"</B>
shall mean, collectively, all conduct in accordance with the provisions of this
Agreement in connection with (i) operating the Facilities and the Internet Store
under the <I>"Disney Store"</I> name (or, in the case of Outlet
Facilities, the name <I>"Disney Store Outlet"</I> or such other name
as shall be approved by each of TDSF and Licensee in its respective sole
discretion), (ii)&#160;developing, manufacturing or causing the manufacture of,
warehousing, distributing, offering for sale and selling Disney Merchandise
solely within the Facilities and the Internet Store, (iii)&#160;marketing,
advertising and promoting the Facilities, the Internet Store and the Disney
Merchandise offered for sale within the Facilities and the Internet Store,
(iv)&#160;corporate administration of the foregoing activities and
(v)&#160;other comparable and ancillary activities related thereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Business
Day"</B> shall mean any day except Saturday, Sunday or any day on which
banks in the State of California are permitted to be closed. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Business
Properties"</B> shall mean, collectively, all Leased Property, Other Real
Property and any other real property used in the Business. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"BVHE"</B> shall mean Buena Vista Home Entertainment, Inc., a wholly owned
subsidiary of TWDC.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"BVHE
Merchandise"</B> shall have the meaning specified in Section 9.6.3(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Canada
Reincorporation"</B> shall have the meaning specified in Section
9.12.1(a)(III). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Canada
Reincorporation Date"</B> shall have the meaning specified in Section
9.12.1(a)(III). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Canadian
Joinder"</B> shall have the meaning specified in Section 9.12.1(a)(II). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Canadian Limited
Partner"</B> shall mean a Nova Scotia entity that is (or will be) a wholly
owned Subsidiary of TDS Canada that has been (or will be) newly formed by TDS
Canada for the sole purpose of holding the limited partner interests in New
Canadian Limited Partnership. For purposes of clarification, Canadian Limited
Partner is or will be a holding company whose sole operation consists of holding
the limited partner interests in New Canadian Limited Partnership. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Canadian
Parent"</B> shall mean Hoop Canada Holdings, Inc., a Delaware corporation,
until the execution and delivery of the Canadian Joinder as contemplated by
Section 9.12.1(a)(II), whereupon "Canadian Parent" shall refer
individually and collectively to Hoop Canada Holdings, Inc., a Delaware
corporation, and Canadian Limited Partner. For purposes of clarification, Hoop
Canada Holdings, Inc. is a holding company whose sole operation consists of
holding the Outstanding TDS Canada Securities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Canadian
Parent Securities"</B> shall mean Securities of Canadian Parent in whatever
form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"CAP"</B>
shall have the meaning specified in Section&#160;5.1.4(a)(iii). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Chain
Wide In Store Materials"</B> shall have the meaning specified in Section
5.2.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Character
Appearances"</B> shall have the meaning specified in Section&#160;4.11. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Character Properties"</B>
shall mean any animated character names, designs and depictions that are
Disney-Branded Properties (<U>e.g.</U>, Mickey Mouse, Donald Duck, Cinderella,
Dumbo, Snow White). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Charged
Off Receivable"</B> shall have the meaning specified in Section 7.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Charitable
Organization"</B> shall mean any charitable organization as defined in
Section 501(c)(3) of the Internal Revenue Code, provided such Charitable
Organization is not in any way Affiliated with any Dabah Stockholders. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Closing
Procedures Objection Notice" </B>shall have the meaning specified in
Section 9.3.1(c). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Co-Branded
Card Agreements"</B> shall mean, collectively, the Bank One Agreement and
the Visa Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Code"</B>
shall have the meaning specified in Section&#160;5.1.4(a)(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Complaint"</B>
shall have the meaning specified in Section&#160;21.23.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Conceptual
Materials"</B> shall have the meaning specified in Section&#160;5.1.1(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Confidential
Information"</B> shall have the meaning specified in Section&#160;17.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Conforming
Approved Template"</B> shall mean an Approved Template in which none of the
Disney Properties included therein have been altered or modified in any manner
(other than proportional increases or decreases in size to reflect different
sized materials) and, except for (i) alterations or modifications to those
features and information that were intended to be changed with each use thereof
as specified by Licensee in connection with the submission of the applicable
proposed Template pursuant to Section 5.2.1 and (ii) immaterial alterations or
modifications that are not related to any Disney Property in any manner
whatsoever (in the case of any dispute arising with respect to subparagraph
(ii), such dispute shall be resolved by TDSF in its business judgment), none of
the other elements of such Approved Template have been altered or modified in
any manner. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Conforming
Sizes"</B> shall have the meaning specified in Section 5.1.3(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Continuing Employee"</B>
shall have the meaning specified in Section 9.4.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Contract"</B>
shall mean any agreement, lease, license, evidence of debt, mortgage, hypothec,
charge, deed of trust, note, bond, indenture, security agreement, commitment,
instrument, understanding, or other contract, obligation or arrangement of any
kind, whether written or oral, including, without limitation, all amendments,
renewals, extensions or other modifications thereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Contract
Year"</B> shall have the meaning specified in Section&#160;2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Contract Year
Royalty Amount"</B> shall have the meaning specified in Section&#160;7.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Contract
Year Start Date"</B> shall have the meaning specified in Section&#160;2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Core
Stores"</B> shall mean those Store Facilities designated as "Core
Stores" under the Acquisition Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"CPI"</B>
shall mean the Consumer Price Index for All Urban Consumers, U.S. City Average
(1982-1984=100) Unadjusted, all items indexed, published by the Bureau of Labor
Statistics (the <B>"BLS"</B>) United States Department of Labor,
subject to the following conditions and contingencies: (i) in the event that the
CPI is revised during the Term, such revised index shall be used to compute all
CPI-based adjustments provided for in this Agreement, <U>provided</U>, that,
should the revised index vary from the unrevised CPI to such an extent that the
BLS publishes a conversion factor, that conversion factor shall be applied to
the unrevised index in determining such adjustments; (ii) in the event the base
reference used in computing the CPI is changed during the Term, the CPI-based
adjustments provided for in this Agreement shall be calculated based on the new
base year index, <U>provided</U>, that, in such event, TDSF shall apply a
conversion factor to the prior base year index for the purpose of making the new
index as comparable as practicable with the prior base year index; and (iii) if
the CPI shall cease to be compiled and published altogether at any time during
the Term, the parties hereto shall mutually agree upon and select an index as
closely comparable thereto as is practicable, but if they are unable to mutually
agree on an index within ten (10) Business Days, an index shall be selected for
the parties hereto by the accounting firm of PricewaterhouseCoopers, which
selection shall be binding on the parties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"CPI
Adjustment Methodology"</B> shall mean, whenever an amount is required to
be increased from one Contract Year to another by the amount of the CPI
increase, such increase shall be calculated by multiplying such amount for the
immediately preceding Contract Year by a fraction, the numerator of which is the
CPI for the month just prior to the commencement of the forthcoming subject
Contract Year (or, if there was no CPI published for such month, the CPI
published for the most recent calendar month prior thereto for which such index
was published shall be used), and the denominator of which is the CPI published
for the same calendar month in the immediately prior Contract Year (or, if there
was no CPI published for such month, the CPI published for the most recent
calendar month prior thereto for which such index was published shall be used);
<U>provided</U>, that in no event (i)&#160;shall such amount for any Contract
Year be less than the applicable amount for the immediately preceding Contract
Year and (ii)&#160;shall the amount for a Contract Year exceed one hundred three
percent (103%) of the applicable amount for the immediately preceding Contract
Year. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Cumulative
Cash Flow"</B> shall mean, at any date, the cumulative Consolidated Net
Income (as defined on <U>Schedule 1(a)</U>) of Licensee, Licensee Parent,
Canadian Parent and their respective Subsidiaries from the commencement of the
Term through the date of calculation, <U>plus</U> (i) without duplication and
only to the extent reflected as a charge in the statement of such Consolidated
Net Income, the amount of depreciation and amortization expense of Licensee,
Licensee Parent, Canadian Parent and their respective Subsidiaries from the
commencement of the Term through the date of calculation, <U>minus</U> (ii) (a)
the amount of all capital expenditures made in connection with the Business, the
Facilities and the Internet Store by Licensee, Licensee Parent, Canadian Parent
and their respective Subsidiaries from the commencement of the Term through the
date of calculation (but excluding any such capital expenditures that were
funded by capital contributions by TCP or Licensee Parent to TDS USA in excess
of the initial Fifty Million Dollar ($50,000,000) capital contribution made by
TCP and Licensee Parent to TDS USA on or about the Effective Date pursuant to
the TCP Guaranty and Commitment) and all Licensee Payments and Dividend Payments
made or accrued but unpaid from the commencement of the Term through the date of
calculation, in each case without duplication and only to the extent not already
deducted in calculating such Consolidated Net Income, and (b) the positive or
negative amount equal to the Working Capital as of the date of calculation
<U>minus</U> the Effective Date Working Capital. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Cure"</B>
or <B>"Cured"</B> shall mean that a breaching party under this
Agreement has cured its respective breach of this Agreement to the satisfaction
of the non-breaching party (as determined by the non-breaching party in its
business judgment) (i) in the case of a Royalty Breach, within five (5) Business
Days following written notice of such breach from the non-breaching party to the
breaching party, (ii) in the case of a Licensee Infringing Use, within ten (10)
Business Days following written notice of such breach from the non-breaching
party to the breaching party (or, if such cure cannot reasonably be accomplished
to the non-breaching party&#146;s satisfaction within such ten (10) Business Day
period, then the breaching party shall in good faith have commenced such cure
within such ten (10) Business Day period and shall thereafter have proceeded
diligently to complete such cure to the non-breaching party&#146;s satisfaction
(as determined by the non-breaching party in its business judgment) within
twenty (20) Business Days following such written notice from the non-breaching
party to the breaching party), and (iii) in the case of any breach other than a
Royalty Breach or a Licensee Infringing Use, within twenty (20) Business Days
following written notice of such breach from the non-breaching party to the
breaching party (or, if such cure cannot reasonably be accomplished to the
non-breaching party&#146;s satisfaction within such twenty (20) Business Day
period, then the breaching party shall in good faith have commenced such cure
within such twenty (20) Business Day period and shall thereafter have proceeded
diligently to complete such cure to the non-breaching party&#146;s satisfaction
(as determined by the non-breaching party in its business judgment) within
thirty (30) Business Days following such written notice from the non-breaching
party to the breaching party). The parties acknowledge and agree that, with
respect to any Marketing Materials or Disney Merchandise that constitute a
breach of this Agreement by Licensee and that were broadly distributed or
disseminated to the general public prior to the date on which Licensee became
aware of such breach of this Agreement, Licensee shall not be required to
collect or recover such publicly distributed Marketing Materials or Disney
Merchandise from the general public in order to Cure the respective breach;
<U>provided</U> that (i) Licensee shall be required to immediately cease any
further distribution thereof to the general public (including, without
limitation, by collecting and recovering such Marketing Materials or Disney
Merchandise from the Facilities or any other locations that are readily
accessible to Licensee without undue cost or burden) and (ii) the foregoing
shall not relieve Licensee of any obligations with respect to the foregoing
under applicable Law, including, without limitation, any recall obligations that
may arise with respect to any Disney Merchandise, or any other obligations
arising under this Agreement with respect to such breach. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Current
Negotiations"</B> shall have the meaning specified in Section&#160;3.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Customer
Data"</B> shall have the meaning specified in Section&#160;10.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Customer Elections"</B>
shall mean any specific requests, preferences, elections or other expressions of
consent or non-consent stated or made by any customers (<U>e.g.</U>,
"opt-in" or "opt-out" elections) in connection with the
Business. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Dabah
Stockholders"</B> shall mean Ezra Dabah, his spouse or former spouse, his
lineal or legally adopted descendants or ancestors (and their spouses), the
trustee of a trust for the principal benefit of one (1) or more of the foregoing
Persons, other comparable estate planning instruments or entities for the
principal benefit of any of the foregoing Persons, and the respective Affiliates
of the foregoing Persons. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Data
Transfer"</B> shall have the meaning specified in Section&#160;10.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"DDM
Business"</B> shall have the meaning specified in Section&#160;6.1.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Debt
Facilities"</B> shall have the meaning specified in Section&#160;9.17.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"DEI"</B>
shall have the meaning specified in the recitals hereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Department
Store"</B> shall mean a retail store (i) offering a variety of products
organized by department <U>(e.g.</U>, men&#146;s clothing, women&#146;s
clothing, children&#146;s clothing, housewares, jewelry, leather goods,
furniture, home electronics, etc.), (ii) with an average store size of not less
than 40,000 and not more than 300,000 gross leaseable square feet, and (iii)
generally offering merchandise on a full-retail pricing model rather than a
discount or warehouse pricing model, except for periodic promotional and
seasonal sales. As of the Effective Date, examples of "Department
Stores" shall be deemed to include Sears, JC Penney, Macy&#146;s,
Lord&#160;&amp; Taylor, Marshall Fields, Filenes, Bloomingdale&#146;s and
Nordstrom. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Design
Modifications"</B> shall have the meaning specified in Section 9.19.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Design Proposal"</B>
shall have the meaning specified in Section 9.19.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Designated
Facilities"</B> shall have the meaning specified in Section 15.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Designated WDW
Stores"</B> shall have the meaning specified in Section&#160;6.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Animated Characters"</B> shall have the meaning specified in
Section&#160;4.11. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney-Branded
Properties"</B> shall mean (i) the <I>"Disney Store"</I> name,
(ii) the names, designs and depictions of the animated characters set forth on
<U>Schedule 1(b)</U>, and (iii) whether or not included in the preceding
subparagraph (ii), all current and future animated character names, designs and
depictions and properties featured in the Motion Picture Properties, the
Publishing Properties, the Television Properties and the Theatrical Properties,
together with all Trademarks (including the name "Disney") associated
with each of the foregoing; <U>provided</U>, that, subject to Section&#160;4.9,
with respect to the preceding subparagraphs (ii) and (iii), (I) any such
animated character name, design or depiction or property shall not be a
Disney-Branded Property hereunder or shall cease to be a Disney-Branded Property
hereunder if it is not, or it ceases to be, owned and controlled by or licensed
to TDSF or any of its Affiliates in a manner that, in TDSF&#146;s or one (1) or
more of its Affiliates&#146; judgment in its sole discretion, entitles and
authorizes TDSF to include such animated character name, design or depiction or
property hereunder for use on or in connection with the Licensed Materials, and
(II) the extent to which any such animated character name, design or depiction
or property is included hereunder as a Disney-Branded Property may be limited by
(a) restrictions on categories of merchandise with which, time periods during
which and territories in which such Disney-Branded Property may be used
(provided that such restrictions have been imposed by a third party) and (b)
prohibitions against the use of certain art styles, depictions and/or
illustrations of or in connection with such Disney-Branded Property. For
purposes of clarification and without limitation, "Disney-Branded
Properties" shall not include any character name, design or depiction or
property that is owned, licensed or otherwise controlled by TDSF or any of its
Affiliates under any name, brand, trademark, logo, symbol or other proprietary
designation that does not incorporate the "Disney" name, such as, by
way of illustration and not limitation, ABC, Miramax, Touchstone, Baby Einstein,
Family Fun and ESPN. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Competitive Business"</B> shall mean any business that competes, in whole
or in part, directly or indirectly, with (i) the motion picture production,
motion picture distribution, television and/or radio programming, television
and/or radio network, television and/or radio station, Theme Park, cruise line,
hotel, resort or animated character-based consumer products business of TDSF or
its Affiliates, or (ii) any other media or entertainment business or other
material division or portion of the present or future business of TDSF or any of
its Affiliates not covered by the preceding subparagraph (i); provided that a
Disney Competitive Business that competes only with a business of TDSF or its
Affiliates identified in the preceding subparagraph (ii) (and not in the
preceding subparagraph (i)) shall not be deemed to constitute a Disney
Competitive Business hereunder if, during the most recently completed fiscal
year of such Disney Competitive Business, it generated less than One Million
Dollars ($1,000,000) of revenues from such competing business. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Dollars"</B> shall mean instruments commonly referred to and known as of
the Effective Date as "Disney Dollars" that may be purchased from TDSF
or its Affiliates and used as a method of payment comparable to cash to purchase
a variety of products and services at certain venues owned, leased, licensed,
controlled and/or operated by TDSF or its Affiliates, any modifications or
replacements of the foregoing and any comparable instruments created by TDSF or
its Affiliates after the Effective Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Extended Non-Core Store Lease Agreement"</B> shall mean the Lease Agreement
for any Non-Core Store with respect to which the term of such Lease Agreement
was extended by DEI without the approval of Licensee Parent pursuant to
DEI&#146;s rights under Section 6.7.1(b)(i)(B)(x) of the Acquisition Agreement;
<U>provided</U> that "Disney Extended Non-Core Store Lease Agreements"
shall not under any circumstances include (i) any Lease Agreement for a Non-Core
Store that was approved by Licensee Parent in accordance with the terms of the
Acquisition Agreement or (ii) any amendment, modification, extension, renewal or
replacement of a Disney Extended Non-Core Store Lease Agreement that may occur
following the Effective Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Guarantee"</B> shall mean the "Guarantee by Disney Worldwide Services,
Inc." attached hereto following the signature page hereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney-Guaranteed
Lease"</B> shall have the meaning specified in Section 9.7.1(g). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
IP Claim"</B> shall mean any claim or challenge (formal or informal,
written or oral), action, complaint, charge, investigation, suit or other
proceeding, whether civil or criminal, in law or in equity, or before any
arbitrator, mediator or Governmental Entity, including, without limitation, any
claims of infringement and any proceedings before the U.S. Patent and Trademark
Office, relating to or arising out of or affecting the Disney Properties, the
Licensed Materials or any other name, brand, trademark, logo, symbol, character
or other proprietary designation or intellectual property of TDSF or its
Affiliates, including, without limitation, (i) claims that any of the foregoing
properties infringe the intellectual property rights of another Person, (ii)
claims that any other Person&#146;s products or activities infringe on any of
the foregoing properties, and (iii) claims arising from the use of any of the
foregoing properties whether by Licensee, TDSF or their respective Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Merchandise"</B> shall mean consumer products and merchandise that (i) are
developed by or on behalf of Licensee under and in strict accordance with the
terms of this Agreement, (ii) are products contained within one of the
Pre-Approved Merchandise Categories or Additional Merchandise Categories, (iii)
bear, feature or incorporate one (1) or more of the Disney Properties and do not
bear, feature or incorporate any character, proprietary designation or
intellectual property of any other Person, <U>provided</U>, that, at any given
time during the Term, up to ten percent (10%) of all SKUs of consumer products
and merchandise then offered for sale in the Facilities and the Internet Store
may consist of merchandise that does not bear, feature or incorporate one (1) or
more of the Disney Properties (although all such merchandise shall bear a
<I>"Disney Store"</I> hang-tag or other identification that identifies
it as <I>"Disney Store"</I> merchandise), which consumer products and
merchandise shall nonetheless be deemed to be "Disney Merchandise"
hereunder so long as such consumer products and merchandise otherwise comply
with subparagraphs (i), (ii), (iii) and (iv) of this definition and are
complementary in nature to the other Disney Merchandise (<U>i.e.</U>, designed
to be used or worn in a coordinated manner together with other Disney
Merchandise), and (iv) are, as determined by TDSF in its sole discretion,
legally authorized and entitled to be labeled with and bear the
"Disney" name (unless such product or merchandise bears, features or
incorporates only Non-Disney-Branded Properties, in which case it shall be
labeled with and bear such name(s) as TDSF shall designate in its sole
discretion). In addition, "Disney Merchandise" shall be deemed to
include all inventories of merchandise that bears, features or incorporates one
(1) or more Disney Properties that is owned or on order by or in transit to
Licensee as of the Effective Date (but not developed by Licensee hereunder). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Privacy Policy"</B> shall mean the consumer data privacy policy established
by TDSF and its Affiliates, as such policy may be amended, modified or replaced
from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Product Guidelines"</B> means the Disney Product Guidelines of TWDC and its
Affiliates, consisting of rules, regulations, procedures and other guidelines
with respect to product safety, including product safety requirements and
obligations designed to protect the image, reputation and brand of the Disney
Properties, as in effect as of the Effective Date and as provided to Licensee by
TDSF prior to the Effective Date, and any successor thereto or replacement
thereof. The Disney Product Guidelines may be amended or modified by TWDC or its
Affiliates from time to time in their sole discretion; provided that no such
amendment or modification shall be effective for purposes of this Agreement
unless such amendment or modification is also imposed upon, to the extent
permitted by applicable Law, (i) all retail locations that are owned and
operated by TWDC or its Affiliates and (ii) all Other Disney Store Operators
(but such amendment or modification need not be imposed upon Other Disney
Licensees). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Properties"</B> shall mean, collectively, Disney-Branded Properties,
Non-Disney-Branded Properties and the TDS Internet Domains. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Reciprocal Return"</B> shall have the meaning specified in
Section&#160;9.9.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Retained Stores"</B> shall mean those <I>"Disney Store"</I>
facilities identified as "Disney Retained Stores" in the Acquisition
Agreement, which were retained by Affiliates of TDSF in connection with the sale
of the equity interests in TDS USA and TDS Canada to Licensee Parent and
Canadian Parent, respectively, pursuant to the Acquisition Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Disney Severance Plan"</B> shall mean the Severance Pay Plan of TWDC.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney
Stored Value Cards"</B> shall have the meaning specified in
Section&#160;9.9.11. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney&#146;s
Visa Card"</B> shall mean the consumer, small business and/or commercial
credit or charge cards issued pursuant to the Bank One Agreement that operate on
the Visa payment clearing network and that feature or display one&#160;(1) or
more of the names, marks, symbols, logos, characters or other proprietary
designations or intellectual property of TDSF or any of its Affiliates,
including the name "Disney," and any successor to or replacement of
such credit or charge cards. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disney&#146;s
Visa Reward Instrument"</B> shall have the meaning specified in
Section&#160;9.8.2(a)(vi). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"DISNEYLAND
Resort"</B> shall mean the entertainment, recreation and lodging complex
located in Anaheim, California, known as DISNEYLAND&#174; Resort, one
of the principal features of which is the operation of two&#160;(2) separately
gated theme and amusement parks known as DISNEYLAND&#174; park and
DISNEY&#146;S CALIFORNIA ADVENTURE&#153; theme park. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"DISNEYLAND
Resort PARIS"</B> shall mean the entertainment and recreation complex
located in Marne-La-Vall&#232;e, France, one of the principal features of which
is the operation of two&#160;(2) separately gated theme and amusement parks
known as DISNEYLAND&#174; theme park and the WALT DISNEY
STUDIOS&#174; theme park. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Disqualified
Person"</B> shall mean (i) any Person or group of Persons who (by itself or
through its Affiliates) owns, leases, licenses, operates or otherwise engages
in, in whole or in part, directly or indirectly, a Disney Competitive Business;
(ii) any Person or group of Persons who does not possess the requisite
experience or expertise in the business of retail sales of consumer merchandise
to enable such Person to operate the Business in the manner contemplated and
required by this Agreement; (iii) any Person or group of Persons whose financial
condition, results of operations, sources of liquidity and/or prospects are
insufficient or inadequate to enable such Person, during the Term, to operate
the Business in accordance with, and to fulfill its other obligations under,
this Agreement, the TCP Guaranty and Commitment and any other Contracts entered
into in connection herewith or therewith; or (iv) any Person or group of Persons
(together with its Affiliates) whose association with the Business, the
Facilities, the Internet Store, Licensee, TDSF or their respective Affiliates,
businesses, assets or properties as a result of the ownership of Licensee
Securities, Licensee Affiliate Securities, TCP Securities or TCP Affiliate
Securities or as a source or provider of liquidity under the Liquidity Plan
(a)&#160;may, as determined by TDSF in its business judgment, be expected to
violate, constitute a default under or breach in any material respect, or, even
if not constituting an actual violation, default or breach, may be expected to
materially conflict with or impair the rights, benefits or value accruing to
Licensee, TDSF or their respective Affiliates under, any material Contract to
which any of Licensee, TDSF or their respective Affiliates is a party or under
which any of their properties or assets are bound, or (b)&#160;may, as
determined by TDSF in its sole discretion, be expected to be injurious to,
adversely impact or be inconsistent with, in any material respect, the image,
reputation, appearance or quality of, or may impair or adversely impact, in any
material respect, the goodwill associated with, the Disney Properties, the
Licensed Materials or any other names, brands, trademarks, logos, symbols,
characters or other proprietary designations or intellectual property of
Licensee, TDSF or their respective Affiliates; <U>provided</U>, that: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) a Person or
group of Persons that, together with its Affiliates taken as a whole, either (x)
is engaged principally in the business of retail sales of consumer merchandise
and does not offer character-based consumer merchandise in more than fifteen
percent (15%) of the aggregate retail merchandising space (in square feet) that
is open to the public (i.e., excluding stock rooms, restrooms and other
non-public or non-retail space) within any store or facility owned, leased,
licensed, controlled or operated by such Person or group of Persons, or (y)
engages in a Disney Competitive Business in no manner whatsoever other than the
ownership of no more than five percent (5%) of the voting securities of a public
company that is engaged in a Disney Competitive Business, shall not be deemed to
be engaged in a Disney Competitive Business under the preceding subparagraph
(i);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) with respect to
the condition under the preceding subparagraph (ii) pertaining to the possession
of the requisite experience or expertise in the business of retail sales of
consumer merchandise, (A) in the case of a Transfer of TCP Securities or TCP
Affiliate Securities, the absence of such experience and expertise shall only
make the acquirer of such TCP Securities or TCP Affiliate Securities a
Disqualified Person if such acquirer is or becomes the Largest TCP Stockholder,
the Second Largest TCP Stockholder, the Largest TCP Affiliate Stockholder or the
Second Largest TCP Affiliate Stockholder, (B) a Person or group of Persons shall
be deemed to have such experience and expertise if the aggregate revenues of
such Person or group of Persons, together with its Affiliates taken as a whole,
during its most recently completed fiscal year prior to the date of
determination hereunder, either (x) were at least fifty percent (50%) comprised
of retail sales of consumer merchandise and included at least Five Hundred
Million Dollars ($500,000,000) of retail sales of consumer merchandise or (y)
included at least One Billion Dollars ($1,000,000,000) of retail sales of
consumer merchandise, and (C) a private equity fund that is engaged in the
business of creating, maintaining and managing a diversified portfolio of
investments shall be deemed to have such experience and expertise if, as of the
date of determination hereunder, it had at least fifty percent (50%) or more of
its aggregate funds under management invested in Persons or groups of Persons
meeting the requirements contained in either of the preceding subparagraphs (x)
or (y) of the preceding subparagraph (B);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) the preceding
subparagraph (iii) shall not apply with respect to a Person (or group of
Persons) owning TCP Securities or TCP Affiliate Securities but not Licensee
Securities or Licensee Affiliate Securities;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) for purposes of
the preceding subparagraph (iv)(a), a Contract shall be considered "material" if
it is material in either a quantitative manner (<U>e.g.</U>, constituting more than two
percent (2%) of a Person's revenues or cash flows from operations) or a
qualitative manner (<U>e.g.</U>, impacting more than one (1) business unit or division
of a Person, the subject of material media or consumer attention, a source of
brand prestige or favorable brand association, a basis for attracting other
business or alliances, a long-term or long-standing arrangement, or other
comparable qualitative factors);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) for purposes of
the preceding subparagraph (iv)(b), TDSF acknowledges and agrees that, in making
its determination in its sole discretion thereunder, it shall not use the
criteria set forth in such subparagraph as a subterfuge to disguise an ulterior
reason for determining that a Person is a "Disqualified Person," but rather TDSF
shall base its determination thereunder solely on the criteria set forth in such
subparagraph to assess whether the Person is appropriate for association with a
family and children's entertainment brand such as "Disney," which would exclude,
by way of example and without limitation, businesses that are associated with,
relate to or promote tobacco, alcohol, firearms, pornography, drugs, violence or
crime (e.g., certain videogames) or gambling;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) no Mutual Fund,
Pension Fund or Eligible Investment Fund shall be or be deemed to be a
Disqualified Person;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) a Banking
Institution's ownership of debt Securities (including, without limitation,
notes, bonds, debentures or other similar debt instruments) of TCP, Licensee
Parent, Licensee, Canadian Parent or any of their respective Subsidiaries shall
not be considered in determining whether such Banking Institution is a
Disqualified Person; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) in the event
that any Banking Institution that is a provider of liquidity under the Liquidity
Plan becomes a Disqualified Person following the date on which it originally
became a provider of liquidity under the Liquidity Plan, Licensee shall have up
to sixty (60) days from the date on which such Banking Institution became a
Disqualified Person to eliminate or replace such Banking Institution as a
provider of liquidity under the Liquidity Plan before such Banking Institution
shall be deemed a Disqualified Person for all purposes of this
Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Distinct
Public Name"</B> shall mean (i) the names Hoop Holdings, LLC, Hoop Retail
Stores, LLC (the proposed name of the successor upon merger of TDS USA), and
Hoop Canada Holdings, Inc., in each case subject to the provisions of Section
9.12.3 with respect to the use of the name "Hoop" and variations
thereof, and (ii) as determined by TDSF in its sole discretion, any other name,
brand, trademark, logo, symbol or other proprietary designation that does not
include, directly or indirectly, in full or abbreviated form, by way of acronym,
slight modification or partial misspelling, or in any other confusingly similar
manner, the term "Disney", "The Disney Stores" or
"TDS" or any variation of any of the foregoing or any of the Disney
Properties or any other names, brands, trademarks, logos, symbols, characters or
other proprietary designations or intellectual property of TDSF or any of its
Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Distribution
Centers"</B> shall mean any and all distribution warehouses, centers or
other comparable facilities used in connection with the shipping, receiving,
storing, warehousing and distribution of goods, products and merchandise to,
from or among the Facilities and the customers of the Internet Store. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Dividend
Payment"</B> shall have the meaning specified in Section&#160;9.13.3(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"DTR
License"</B> shall mean a license granted by TDSF or its Affiliates
directly to a Person, which license authorizes such Person to create, design,
source, manufacture, cause the manufacture of, offer for sale, sell and
distribute consumer products featuring one (1) or more Character Properties
through such Person&#146;s retail stores, outlets or other retail channels of
distribution. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"DTR
Notice"</B> shall have the meaning specified in Section 6.2.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"DTR Product
Category"</B> shall mean any specific category of consumer products set
forth on <U>Schedule 1(c)</U>, as such <U>Schedule 1(c)</U> may be amended from
time to time with the approval of TDSF and Licensee in their respective sole
discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Effective
Date"</B> shall have the meaning specified in the preamble to this
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Effective
Date Working Capital"</B> shall mean, as of the last day of the Fiscal
Quarter of Licensee in which the Subsequent Closing occurs, the sum of all
current assets reflected on a consolidated balance sheet of Licensee, Licensee
Parent, Canadian Parent and their respective Subsidiaries prepared in accordance
with GAAP, <U>minus</U> the sum of all current liabilities reflected on such
consolidated balance sheet. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"El
Capitan"</B> shall mean the El Capitan Theater located at 6838 Hollywood
Boulevard, Los Angeles, California. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Election
Notice"</B> shall have the meaning specified in Section&#160;15.1.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Eligible Investment
Fund"</B> shall mean any Person that is an "investment company"
within the meaning of the Investment Company Act of 1940 and the rules and
regulations promulgated thereunder, but only if and for so long as such
Person&#146;s investment in Licensee Securities, Licensee Affiliate Securities,
TCP Securities or TCP Affiliate Securities is held solely for investment
purposes (as a passive investor) and not for the purpose, or with the effect, of
changing or influencing the control, management or policies of Licensee,
Licensee Parent, Canadian Parent, any Subsidiary of Licensee, Licensee Parent or
Canadian Parent, TCP or such TCP Affiliate or as a participant in any
transaction having that purpose or effect; <U>provided</U>, that, for purposes
of this Agreement, any Eligible Investment Fund that is sponsored, established,
administered, issued, controlled, owned or operated by a Person who would be a
Disqualified Person but for subparagraph (6) of the definition of
"Disqualified Person" shall be excluded from the definition of
"Eligible Investment Fund." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Emergency
Arbitrator"</B> shall have the meaning specified in Section&#160;21.23.7. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Employee
Benefit Plans"</B> shall mean (i)&#160;any employee benefit plan within the
meaning of Section&#160;3(3) of ERISA, (ii)&#160;any similar employment,
consulting, severance agreement, contract, commitment, program or other
arrangement or policy (whether written or oral) providing for insurance coverage
(including self-insured arrangements), workers&#146; compensation, disability
benefits, supplemental unemployment benefits, vacation benefits, fringe
benefits, retirement benefits, life, health or accident benefits (including,
without limitation, any "voluntary employees&#146; beneficiary
association" as defined in Section 501(c)(9) of the Internal Revenue Code
providing for the same or other benefits), or profit-sharing, deferred
compensation, bonuses, stock options, stock appreciation rights or other
stock-based awards, or other forms of incentive compensation or post-retirement
insurance, compensation or benefits, (iii) any Pension Fund, or (iv) any
Multiemployer Plan. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Encumbrance"</B>
shall mean any easement, encumbrance, security interest, lien, hypothec, charge,
pledge, or comparable restriction, except for any restrictions on transfer
generally arising under any applicable federal, state or provincial securities
Law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Environmental
Laws"</B> shall mean all federal, state, provincial and local government or
agency Laws relating to pollution or protection of human health and safety or
the environment (including air, surface water, ground water, land surface and
subsurface strata), including Laws relating to emissions, discharges, releases
or threatened releases of Hazardous Substances, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transportation or handling of Hazardous Substances. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Equitable
Action"</B> shall have the meaning specified in Section&#160;21.21.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"ERISA"</B>
shall mean the Employee Retirement Income Security Act of 1974, as amended, and
the related regulations and published interpretations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Exercise
Notice"</B> shall have the meaning specified in Section 2.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Existing DTR
License"</B> shall have the meaning specified in Section&#160;6.2.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Existing
Restricted Name Agreement"</B> shall have the meaning specified in
Section&#160;6.1.7. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Facilities"</B>
shall mean, collectively, all Store Facilities and all Outlet Facilities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Facility
Appraisal Value"</B> shall have the meaning specified in
Section&#160;15.2.1(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Facility
Design Elements"</B> shall have the meaning specified in Section 9.3.6(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Federal
Bankruptcy Code"</B> shall mean Title 11 of the United States Code entitled
"Bankruptcy," as now and hereafter in effect, or any successor statute
or, with respect to any jurisdiction other than the United States, any other
equivalent law of such jurisdiction. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"FF&amp;E
Materials"</B> shall have the meaning specified in Section&#160;4.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Financial
Covenant"</B> shall have the meaning specified in Section 2.2.1(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Fiscal
Quarter"</B> shall mean a fiscal quarter of any Fiscal Year of the
applicable Person referred to in each instance in this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Fiscal
Year"</B> shall mean, in the case of TDSF, the fiscal year of TDSF and its
Subsidiaries ending on September 30 of each calendar year or, if changed by
TDSF, such other fiscal year as may be designated by TDSF in writing to
Licensee, and, in the case of the Licensee Entities and the TCP Entities, the
annual period consisting of a "retail" fiscal year and four
"retail" fiscal quarters and twelve (12) Retail Months selected from
time to time by each such Person as its fiscal year for accounting purposes in
accordance with GAAP. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Floor
Guarantee"</B> shall have the meaning specified in Section 7.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"FMV
Appraisal"</B> shall have the meaning specified in Section&#160;15.2.1(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Five
Year Date"</B> shall have the meaning specified in Section&#160;9.17.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"FY04 Cash
Contribution"</B> shall mean the aggregate amount of all revenues generated
from all sales of goods, products, merchandise, services or other items of any
kind in the Non-Core Stores during the fiscal year ended October&#160;2, 2004
<U>minus</U> the aggregate amount of all actual cash expenses related directly
and solely to the operation of the Non-Core Stores incurred during the fiscal
year ended October&#160;2, 2004 (including, without limitation, all rent
(including base rent and percentage rent or comparable payments if designated by
a different name), common area maintenance charges, taxes and other amounts paid
pursuant to the Lease Agreements for the Non-Core Stores, all expenses related
to employees at the Non-Core Stores and merchandise inventories located within
the Non-Core Stores (including, without limitation, freight-to-store expenses
and merchandise shrinkage) and all cleaning, maintenance and repair expenses
related to the Non-Core Stores), calculated by TDSF in good faith in accordance
with past practice. For purposes of clarification, (i) depreciation and
amortization expenses (with respect to the Non-Core Stores or otherwise), (ii)
expenses related to capital improvements (at the Non-Core Stores or elsewhere),
(iii) expenses related to the corporate headquarters or other corporate offices
or corporate employees of TDSF or its Affiliates, (iv) expenses related to
distribution operations or any distribution warehouses, centers or other
comparable facilities used by TDSF or its Affiliates in connection with the
shipping, receiving, storing, warehousing and distribution of goods, products
and merchandise, (v) other corporate overhead expenses (including, without
limitation, marketing expenses (other than in-store marketing expenses), income
tax expense, interest expense, commissions, discounts and other fees and charges
associated with indebtedness and amortization of intangibles (including, but not
limited to, goodwill)), and (vi) expenses related to any other properties or
operations of TDSF or its Affiliates (including, without limitation, the Core
Stores and the Predecessor Disney Website) shall not be considered expenses
related directly and solely to the operation of the Non-Core Stores for purposes
of calculating FY04 Cash Contribution. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"GAAP"</B>
shall mean generally accepted accounting principles in the United States, as in
effect from time to time, consistently applied. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"General
DTR License"</B> shall mean a DTR License under which TDSF or its
Affiliates authorize the use of more than one (1) family of Character Properties
in connection with the consumer products manufactured and sold thereunder. For
purposes of clarification, a family of Character Properties generally shall
consist of all Character Properties associated with a particular line of
characters or featured in a particular Motion Picture Property, Publishing
Property, Television Property or Theatrical Property. For purposes of
illustration and without limitation, each animated motion picture or character
line set forth in the left-hand column on <U>Schedule 1(b)</U> (<U>e.g.</U>,
Walt Disney&#146;s Cinderella, Disney&#146;s Beauty and the Beast, Disney&#146;s
standard characters (which includes Mickey Mouse, Minnie Mouse, Donald Duck,
Daisy Duck, Pluto and Goofy), the Winnie the Pooh line of characters, etc.)
shall, in the aggregate, constitute one (1) family of Character Properties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Gift
Card"</B> shall mean any gift card, certificate or other redemption
instrument, vehicle or methodology, whether in paper, plastic, electronic or
other form, that may be used as a method of payment at the Facilities, the
Internet Store or any retail locations owned, leased, licensed, controlled
and/or operated by TDSF or its Affiliates, including, without limitation, the
Disney Stored Value Cards. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Governing
Documents"</B> shall mean, with respect to any Person, the charter
documents (articles or certificate of incorporation or other), bylaws, operating
agreements, partnership or limited partnership agreements, securityholders
agreements and other governing documents and other Contracts pertaining to the
management or operation of, or the ownership of any Securities of, such Person. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Governmental
Entity"</B> shall mean any government or any agency, bureau, board,
commission, court, department, official, political subdivision, tribunal or
other instrumentality of any government, whether federal, state, provincial or
local, or domestic or foreign, and any self-regulatory agency, such as the New
York Stock Exchange or the Nasdaq Stock Market. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Guarantee
Amount"</B> shall have the meaning specified in Section&#160;7.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Guarantor"</B>
shall have the meaning specified in the Disney Guarantee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Guaranty
Assumption"</B> shall mean an assumption by a Qualified Person of all (or
such portion as shall be required by TDSF in its sole discretion) of the
liabilities, duties and obligations (past, present and future) of TCP and
Licensee Parent arising under the TCP Guaranty and Commitment and any related
Contract entered into in connection therewith, such assumption to be in writing
and in form and substance satisfactory to TDSF in its business judgment,
<U>provided</U>, that no such Guaranty Assumption shall be deemed to relieve TCP
or Licensee Parent of any of its liabilities, duties or obligations under the
TCP Guaranty and Commitment unless TDSF shall elect, in its sole discretion, to
release such parties from such liabilities, duties or obligations thereunder in
writing, and, in the absence of any such written release, TCP and Licensee
Parent shall remain jointly and severally liable, together with any party to a
Guaranty Assumption, for all of their liabilities, duties and obligations
thereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Hardlines"</B>
shall mean those categories of hardline consumer products set forth on
<U>Schedule 1(d)</U>, as such <U>Schedule 1(d)</U> may be amended from time to
time with the approval of TDSF and Licensee in their respective sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Hazardous
Substances"</B> shall mean substances that are defined or listed in, or
otherwise classified under, any applicable Laws as "hazardous
substances," "hazardous materials," "hazardous wastes"
or "toxic substances," or any other formulation intended to define,
list or classify substances by reason of deleterious properties such as
ignitibility, corrosivity, reactivity, carcinogenicity, reproductive toxicity or
"EP toxicity," and petroleum. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Hyperlink"</B>
shall have the meaning specified in Section&#160;9.3.2(b)(vii). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Ideas"</B>
shall have the meaning specified in Section&#160;17.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Identifiable
Food Service Area"</B> shall have the meaning specified in
Section&#160;5.2.8(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"ILS"</B>
shall have the meaning specified in Section&#160;5.1.4(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"In
Store Materials"</B> shall have the meaning specified in Section 5.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"In Store
Response Failure"</B> shall have the meaning specified in Section 5.2.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"In
Store Response Failure Fee"</B> shall have the meaning specified in Section
5.2.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Indebtedness"</B>
shall have the meaning specified in <U>Schedule 1(a)</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Indemnified
Party"</B> shall have the meaning specified in Section&#160;12.3.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Indemnifying
Party"</B> shall have the meaning specified in Section&#160;12.3.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Independent
Director"</B> shall mean a person who is a U.S. citizen (or with respect to
any Licensee Entity organized in Canada or any province thereof, either a U.S.
or a Canadian citizen), who is at least thirty (30) years old, and who shall not
be, and shall not have been within the three (3) years prior to being selected
as an Independent Director, either (i) a director, officer or employee of, or a
relative (by birth, marriage or otherwise) of a director, officer or employee
of, a Licensee Entity, a TCP Entity, TDSF or any of their respective Affiliates,
(ii) a person who (individually or with any group of Persons) beneficially owns
(within the meaning of Rule 13d-3 under the Securities Exchange Act) ten percent
(10%) or more of any voting Securities of a Licensee Entity, a TCP Entity, TDSF
or any of their respective Affiliates, or any relative (by birth, marriage or
otherwise) of any such person, or (iii) a person who (A) has received, or whose
relative (by birth, marriage or otherwise) has received, more than Fifty
Thousand Dollars ($50,000) per year in direct compensation from a Licensee
Entity, a TCP Entity, TDSF or any of their respective Affiliates, other than
pension or other forms of deferred compensation for prior service (provided such
compensation is not contingent in any way on continued service); (B) is an
Affiliate of, or employed by, or whose relative (by birth, marriage or
otherwise) is an Affiliate of, or employed in a professional capacity by, a
present or former internal or external auditor of a Licensee Entity, a TCP
Entity, TDSF or any of their respective Affiliates; (C) is employed, or whose
relative (by birth, marriage or otherwise) is employed, as an executive officer
of another company where any of the present directors, officers or employees of
a Licensee Entity, a TCP Entity, TDSF or any of their respective Affiliates
serve on that company&#146;s board or compensation committee; or (D) is a
director, officer or employee, or whose relative (by birth, marriage or
otherwise) is a director, officer or employee, of a company that makes payments
to, or receives payments from, a Licensee Entity, a TCP Entity, TDSF or any of
their respective Affiliates for property or services in an amount that, in any
single Fiscal Year, exceeds the greater of (x) One Million Dollars ($1,000,000)
and (y) two percent (2%) of such other company&#146;s consolidated gross
revenues. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Initial
Minimum Refurbishment Commitment"</B> shall have the meaning specified in
Section&#160;9.3.5(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Initial
Model Design"</B> shall have the meaning specified in
Section&#160;9.19.2(d). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Initial
Non-Core Stores Abatement Period"</B> shall have the meaning specified in
Section&#160;7.1.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Initial
Term"</B> shall have the meaning specified in Section&#160;2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Insolvent"</B>
shall mean (i) a Person has ceased to pay its debts in the ordinary course of
business or cannot pay its debts as they become due, or (ii) a Person&#146;s
financial condition is such that the sum of its liabilities is greater than the
sum of its assets determined in accordance with GAAP (except that, in the case
of TDSF, the assets and liabilities of TDSF&#146;s ultimate parent entity, TWDC,
shall be considered for purposes of such determination). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Internal
Revenue Code"</B> shall mean the Internal Revenue Code of 1986, as amended. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Internet Start Date"</B> shall mean October 1, 2005.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Internet Store"</B>
shall mean an online specialty retail store that (i) is located on the World
Wide Web at the TDS Internet Domains or such other domain names or URLs as
Licensee may request and TDSF may approve in its sole discretion, (ii) offers a
variety of Disney Merchandise in a general emporium format, (iii) does not offer
for sale, feature or sell any goods, products, merchandise, services or other
items other than Disney Merchandise that (a) is then offered, (b) has been
offered within the preceding twelve (12) Retail Months or (c) pursuant to the
Quarterly Merchandise Plans for the applicable Contract Year shall be offered
within the following six (6) Retail Months, in each case in at least one-third
(1/3) of the Store Facilities (provided that the Internet Store may offer such
Disney Merchandise consisting of apparel in sizes not available in any Store
Facility so long as such sizes have been approved by TDSF pursuant to Section
5.1.3(i)), and (iv) is owned by Licensee and operated by Licensee under the
<I>"Disney Store"</I> name in a form, manner and style that are
approved by each of TDSF and Licensee in its respective sole discretion
following the Effective Date or as are otherwise permitted by, and are in
accordance with, the provisions of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Japan
Disney Store Merchandise"</B> shall mean any Other Disney Store Merchandise
that is developed by a Japan Disney Store Operator. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Japan
Disney Store Operator"</B> shall mean any Other Disney Store Operator
designated by TDSF or its Affiliates from time to time that operates one (1) or
more retail stores under the <I>"Disney Store"</I> name in Japan. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Joint
Advisory Committee"</B> shall have the meaning specified in
Section&#160;8.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Judgment
Threshold"</B> shall have the meaning specified in Section&#160;13.12. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Knowledge"</B>
shall mean the actual knowledge of the applicable Person (if such Person is a
natural person) or the actual knowledge of any executive officer of the
applicable Person (if such Person is a corporation, partnership, limited
partnership, limited liability company, trust or other form of legal entity). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Landlord"</B>
shall have the meaning specified in Section 9.7.1(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Largest
TCP Affiliate Stockholder"</B> shall mean, with respect to each Affiliate
of TCP (other than Licensee, Licensee Parent, Canadian Parent and the
Subsidiaries of Licensee, Licensee Parent and Canadian Parent), the Person or
group of Persons whose beneficial ownership (within the meaning of Rule 13d-3
under the Securities Exchange Act) of voting TCP Affiliate Securities of such
Affiliate of TCP entitles it to the largest vote in the election of the board of
directors (or comparable governing body) of such Affiliate of TCP among all
holders of TCP Affiliate Securities of such Affiliate of TCP. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Largest
TCP Stockholder"</B> shall mean the Person or group of Persons whose
beneficial ownership (within the meaning of Rule 13d-3 under the Securities
Exchange Act) of voting TCP Securities entitles it to the largest vote in the
election of TCP&#146;s board of directors (or comparable governing body) among
all holders of TCP Securities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Law"</B>
or <B>"Laws"</B> shall mean any law, statute, order, decree, judgment,
rule, regulation, code, administrative requirement, ordinance or other
pronouncement of any Governmental Entity or having the effect of law in any
jurisdiction, federal, state, provincial or local, foreign or domestic. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Lease
Agreements"</B> shall mean the agreements, written or oral, express or
implied, present or future, creating or regarding Licensee&#146;s rights to the
Leased Property, including, without limitation, any addenda, riders, exhibits,
schedules, amendments, extensions, waivers, modifications or replacements
thereof. For purposes of clarification, "Lease Agreements" includes
New Business Property Lease Agreements and Lease Extension Arrangements. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Lease
Extension Arrangements"</B> shall mean any agreement or arrangement,
written or oral, express or implied, that becomes effective after the Effective
Date and extends the term of a Lease Agreement (including, without limitation,
by renewal, amendment, extension, replacement or exercise of an option to
extend). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Leased
Property"</B> shall mean (a) any and all Facilities and (b) any real
property other than a Facility of which fifty percent (50%) or more of such real
property was, is or will be used by Licensee relating to, or associated with,
the Business (<U>e.g.</U>, a corporate headquarters or other office) in which,
in the case of subparagraph (a) or (b), Licensee (i) had, has or will have an
estate for years, a leasehold estate or a subleasehold estate, (ii) was, is or
will become a tenant, lessee, subtenant, sublessee, landlord, lessor,
sublandlord or sublessor or (iii) had, has or will have any options, rights of
first refusal, expansion rights or other similar rights to enter into an estate
for years, a leasehold estate or a subleasehold estate. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Lender
Liquidation Period"</B> shall have the meaning specified in Section 16.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"License
Assumption"</B> shall mean an assumption by a Qualified Person of all (or
such portion as shall be required by TDSF in its sole discretion) of the
liabilities, duties and obligations (past, present and future) of Licensee
arising under this Agreement and any related Contract entered into in connection
herewith, such assumption to be in writing and in form and substance
satisfactory to TDSF in its business judgment, <U>provided</U>, that no such
License Assumption shall be deemed to relieve Licensee of any of its
liabilities, duties or obligations under this Agreement unless TDSF shall elect,
in its sole discretion, to release Licensee from such liabilities, duties or
obligations hereunder in writing, and, in the absence of any such written
release, TDS USA and TDS Canada shall remain jointly and severally liable,
together with any party to a License Assumption, for all of their liabilities,
duties and obligations hereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"License
Encumbrance Agreement"</B> shall have the meaning set forth in Section
6.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensed
Materials"</B> shall have the meaning specified in Section&#160;4.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee"</B>
shall have the meaning specified in the preamble to this Agreement. As the
context may require, "Licensee" shall be deemed to refer to TDS USA
and/or TDS Canada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Advisors"</B> shall have the meaning specified in Section&#160;8.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee Affiliate
Securities"</B> shall mean Securities of Licensee Parent, Canadian Parent,
any Subsidiary of Licensee Parent or Canadian Parent (other than Licensee) and
any Subsidiary of Licensee, in whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Board"</B> and <B>"Licensee Boards"</B> shall have the respective
meanings specified in Section&#160;9.13.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Compensation Amount"</B> shall have the meaning specified in
Section&#160;15.2.3(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Employee"</B> shall have the meaning specified in Section 9.4.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee Entities"</B>
shall have the meaning specified in Section&#160;9.13.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Infringing Use"</B> shall mean Licensee&#146;s use of any Disney
Properties, Licensed Materials or any other names, brands, trademarks, logos,
symbols, characters or other proprietary designations or intellectual property
of TDSF or any of its Affiliates (i) without the approval in writing of TDSF in
accordance with this Agreement, (ii) in a manner that fails to comply in any
respect with any approval in writing of TDSF granted in accordance with the
terms of this Agreement or (iii) in a manner that violates or breaches any
provision of this Agreement in any material respect, in the case of each of
subparagraphs (i), (ii) and (iii), such uses shall be and be deemed to be an
infringement of the rights of TDSF and/or its Affiliates in and to such Disney
Properties, Licensed Materials and/or other names, brands, trademarks, logos,
symbols, characters or other proprietary designations or intellectual property
of TDSF or any of its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Infringement/Breach Fee"</B> shall have the meaning specified in
Section&#160;21.24.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Infringement/Breach Fee Maximum Amounts"</B> shall have the meaning
specified in Section&#160;21.24.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Parent"</B> shall have the meaning set forth in the recitals hereto. For
purposes of clarification, Licensee Parent is a holding company whose sole
operation consists of holding the Outstanding TDS USA Securities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"<B>Licensee
Parent Securities</B>" shall mean Securities of Licensee Parent in whatever
form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Payments"</B> shall have the meaning specified in Section&#160;7.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee Percent
LTM Sales"</B> shall mean, with respect to any proposed new DTR License to
be granted by TDSF or its Affiliates after the Effective Date to a chain of
Specialty Retail Stores, the percentage of Licensee&#146;s Net Retail Sales
derived, during the full twelve (12) Retail Month period completed immediately
preceding the Retail Month in which the DTR Notice pertaining to such proposed
new DTR License is provided, from a particular Property-Product Combination
authorized or to be authorized under such DTR License. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Reciprocal Return"</B> shall have the meaning specified in
Section&#160;9.9.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Licensee
Securities"</B> shall mean Securities of TDS USA and/or TDS Canada in
whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Liquidation
Period"</B> shall have the meaning specified in Section 16.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Liquidators"</B>
shall have the meaning specified in Section&#160;6.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Liquidity
Period"</B> shall have the meaning specified in Section 9.11.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Liquidity Plan"</B>
shall have the meaning specified in Section 9.11.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Long-Term
Lease"</B> shall mean any Lease Agreement with respect to a Facility that
is not a Short-Term Lease. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Loss"</B>
shall have the meaning specified in Section&#160;12.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Loss
Threshold"</B> shall have the meaning specified in Section&#160;13.13. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Management
Employees"</B> shall have the meaning specified in Section 9.4.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Manufacturers"</B>
shall have the meaning specified in Section&#160;5.1.4(a)(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Manufacturer&#146;s
Agreement"</B> shall have the meaning specified in
Section&#160;5.1.4(a)(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Manufacturer&#146;s
FAMA"</B> shall have the meaning specified in Section&#160;5.1.4(a)(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Manufacturer&#146;s MOU"</B>
shall have the meaning specified in Section&#160;5.1.4(a)(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Marketing
Materials"</B> shall have the meaning specified in Section&#160;4.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Mass
Merchandiser"</B> shall mean retail stores (i) offering either (x) a wide
range of products within one product category or a small number of product
categories (<U>e.g.</U>, toys, sporting goods, home electronics, etc.) or (y)
numerous categories of products organized by department (<U>e.g.</U>, some or
all of the following: men&#146;s clothing, women&#146;s clothing,
children&#146;s clothing, housewares, jewelry, leather goods, furniture, home
electronics, etc.), (ii) with an average store size of not less than fifty
thousand (50,000) gross leaseable square feet, and (iii) generally offering
merchandise on a "low-price" retail pricing model or a wholesale
pricing model rather than a full-priced retail pricing model, which may (but
need not) involve regular promotional and seasonal sales. As of the Effective
Date, examples of "Mass Merchandisers" shall be deemed to include
Wal-Mart, Target, Kmart, Toys "R" Us, Costco and Sam&#146;s Club. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Material
Breach"</B> shall mean, excluding any Licensee Infringing Use, (i)&#160;the
failure by either party in any material respect to perform any agreement, term,
covenant or condition to be performed by such party under this Agreement or
(ii)&#160;any breach by either party of any representation or warranty of such
party under this Agreement in any material respect. For purposes of
clarification, "Material Breach" shall include any Royalty Breach. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Maximum
Guarantee Liability"</B> shall have the meaning specified in the Disney
Guarantee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Maximum
Refurbishment Amount"</B> shall have the meaning specified in
Section&#160;9.19.2(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"McDonald&#146;s
Agreement"</B> shall mean that certain Participant Agreement dated as of
December 8, 1996, between McDonald&#146;s Corporation and Disney Enterprises,
Inc., as amended. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Measurement
Period"</B> shall have the meaning specified in Section&#160;2.2.1(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Minor
Revision Approved Template"</B> shall mean an Approved Template in which
the only alterations or modifications thereto (other than (i) alterations or
modifications to those features and information that were intended to be changed
with each use thereof as specified by Licensee in connection with the submission
of the applicable proposed Template pursuant to Section 5.2.1 and (ii)
immaterial variations that are not related to any Disney Property in any manner
whatsoever (in the case of disputes arising with respect to this subparagraph
(ii), such disputes shall be resolved by TDSF in its business judgment)) consist
of minor revisions to the Disney Properties included therein or other elements
thereof, as determined by TDSF in its sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Model
Design"</B> shall have the meaning specified in Section&#160;9.19.2(d). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Monogram
Agreement"</B> shall mean the Amended and Restated Credit Card Program
Agreement dated as of February 11, 1994, between Monogram Bank and Disney Credit
Card Services, Inc., as amended. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Monogram
Bank"</B> shall mean Monogram Credit Card Bank of Georgia, a Georgia
banking corporation. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Monogram-Disney
Card"</B> shall mean the private label credit and charge cards that are
issued by Monogram Bank pursuant to the Monogram Agreement, that feature one (1)
or more of the names, marks, symbols, logos, characters and other proprietary
designations or intellectual property of TDSF or any of its Affiliates,
including the name "Disney", and that are accepted as a method of
payment at the Facilities, the Internet Store and certain business operations of
TDSF or its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Monthly
Facilities Royalty Amount"</B> shall have the meaning specified in
Section&#160;7.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Monthly
Internet Store Royalty Amount"</B> shall have the meaning specified in
Section&#160;7.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Monthly
Royalty Amount"</B> shall mean the Monthly Facilities Royalty Amount
<U>plus</U> the Monthly Internet Store Royalty Amount. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Motion
Picture Properties"</B> shall mean children-oriented animated motion
pictures that are produced and/or distributed (whether through movie theaters or
home entertainment devices such as video tapes and digital video discs) by TDSF
or any of its Affiliates under the "Walt Disney Pictures" or
"Disney/Pixar" banner or any other banner that incorporates the name
"Disney" or any variation thereof, but specifically excluding any
other theatrical motion pictures that are produced and/or distributed by TDSF or
any of its Affiliates, such as, by way of illustration and without limitation,
motion pictures produced and/or distributed under the Touchstone and Miramax
banners. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Multiemployer
Plan"</B> shall mean any "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA that is (or was) subject to Title IV of ERISA. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Mutual
Fund"</B> shall mean any open-end investment fund commonly known as a
"mutual fund" that combines the funds of numerous individual
investors, invests such funds in a variety of securities, and enables each
individual investor to participate on a pro rata basis in all such investments
through such investor&#146;s interest in the mutual fund; <U>provided</U>, that,
for purposes of this Agreement, any Mutual Fund that is sponsored, established,
administered, controlled or operated by a Person who would be a Disqualified
Person but for subparagraph (6) of the definition of "Disqualified
Person" shall be excluded from the definition of "Mutual Fund." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"NDB
Stores"</B> shall mean specialty retail stores that are primarily focused
on the sale of Softlines and/or Toys/Plush that bear, feature or incorporate
names, brands, trademarks, logos, symbols, characters or other proprietary
designations or intellectual property that are owned, licensed or otherwise
controlled by TDSF and/or any of its Affiliates other than Disney-Branded
Properties, including, without limitation, all Non-Disney-Branded Properties,
but specifically excluding any character names, designs or depictions or
properties that are owned, licensed or otherwise controlled by TDSF or its
Affiliates under any name, brand, trademark, logo, symbol or other proprietary
designation of Miramax (by way of illustration and without limitation, a
"Family Fun Store"). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Net
Retail Sales"</B> shall have the meaning specified in Section&#160;7.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"New Business
Property"</B> shall mean any Facility, Distribution Center, corporate
office or other location, store, facility or real property used in the Business
that is leased, purchased or otherwise acquired by Licensee or any of its
Affiliates after the Effective Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"New
Business Property Lease Agreements"</B> shall mean Lease Agreements
pertaining to New Business Properties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"New
Canadian Limited Partnership"</B> shall have the meaning specified in
Section 9.12.1(a)(II). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"New
Sales Medium"</B> shall have the meaning specified in Section 9.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"New Store
Construction"</B> shall have the meaning specified in Section 9.19.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Non-Conforming
Approved Template"</B> shall mean an Approved Template in which any of the
Disney Properties included therein or any other elements thereof have been
altered or modified in any manner, other than (i) alterations or modifications
to those features and information that were intended to be changed with each use
thereof as specified by Licensee in connection with the submission of the
applicable proposed Template pursuant to Section 5.2.1, (ii) immaterial
variations that are not related to any Disney Property in any manner whatsoever
(in the case of disputes arising with respect to this subparagraph (ii), such
disputes shall be resolved by TDSF in its business judgment) or (iii) minor
revisions to the Disney Properties included therein or other elements thereof
(in the case of this subparagraph (iii) as determined by TDSF in its sole
discretion). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Non-Conforming
Sizes"</B> shall have the meaning specified in Section 5.1.3(i). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Non-Core
Stores"</B> shall mean those Store Facilities designated as "Non-Core
Stores" under the Acquisition Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Non-Disney-Branded
Properties"</B> shall mean, excluding Disney-Branded Properties, those
children-oriented animated character names, designs and depictions and/or
properties, together with their related Trademarks, that are (i) owned and
controlled by TDSF or any of its Affiliates or licensed to TDSF or any of its
Affiliates in a manner that, in TDSF&#146;s or one (1) or more of its
Affiliates&#146; judgment in its sole discretion, entitles and authorizes TDSF
to include such animated character names, designs or depictions or properties
hereunder for use on or in connection with the Licensed Materials, (ii)
determined by TDSF, in its sole discretion, to be appropriate to offer, sell and
distribute through the Facilities and the Internet Store, whether based on brand
considerations, customer demand, release schedules for entertainment properties,
tie-ins with Disney-Branded Properties or such other factors as TDSF may wish to
consider in its sole discretion (<U>provided</U>, that (x)&#160;TDSF shall not
be required to provide any reason to Licensee for its determination and
(y)&#160;in making such determination, TDSF will not treat Licensee less
favorably in any material respect than any Other Disney Store Operator has been
treated by TDSF or its Affiliates with respect to the applicable
Non-Disney-Branded Property), and (iii) designated from time to time in writing
by TDSF, in its sole discretion, as "Non-Disney-Branded Properties"
hereunder, which designation may, in TDSF&#146;s sole discretion, include a
specified time period, specified usage or other comparable limitations;
<U>provided</U>, that, subject to Section&#160;4.9, (I) any such animated
character name, design or depiction or property shall cease to be a
Non-Disney-Branded Property hereunder at such time as (a)(1)&#160;it is no
longer owned and controlled by or licensed to TDSF or any of its Affiliates in a
manner that, in TDSF&#146;s or one (1) or more of its Affiliates&#146; judgment
in its sole discretion, entitles and authorizes TDSF to include such animated
character name, design or depiction or property hereunder for use on or in
connection with the Licensed Materials, or (2)&#160;it is, in TDSF&#146;s
judgment in its sole discretion, otherwise inconsistent with or inappropriate
for the image, reputation and brand of a specialty retail store operated under
the <I>"Disney Store"</I> name, or (b) TDSF shall specify in writing
to Licensee (<U>provided</U>, that, in making its determination or specification
under the preceding subparagraph (a)(2) or (b), TDSF will not treat Licensee
less favorably in any material respect than any Other Disney Store Operator has
been treated by TDSF or its Affiliates with respect to the applicable
Non-Disney-Branded Property), and (II) the extent to which any such animated
character name, design or depiction or property is included hereunder as a
Non-Disney-Branded Property may be limited by the rights of any third parties in
or to such Non-Disney-Branded Property, which limitations may include, by way of
example and without limitation, restrictions on categories of merchandise with
which such Non-Disney-Branded Property may be used, time periods during which
and territories within which such Non-Disney-Branded Property may be used,
prohibitions against the use of certain art styles, depictions and/or
illustrations of or in connection with such Non-Disney-Branded Property,
exclusive manufacturing rights granted to certain manufacturers with respect to
specified categories of consumer products, or other rights or restrictions
imposed by such third parties. Notwithstanding the foregoing, under no
circumstances shall "Non-Disney-Branded Properties" include any
character names, designs or depictions or properties that are owned, licensed or
otherwise controlled by TDSF or its Affiliates under any name, brand, trademark,
logo, symbol or other proprietary designation of Miramax. <U>Schedule 1(e)</U>
sets forth the Non-Disney-Branded Properties available as of the Effective Date
for Licensee&#146;s use in connection with the Licensed Materials in accordance
with the terms of this Agreement, subject to TDSF&#146;s rights under the
foregoing definition of Non-Disney-Branded Properties and Section 4.9. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Non-Disney
Technology and Elements"</B> shall have the meaning specified in
Section&#160;11.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Non-DTR
Products"</B> shall have the meaning specified in Section&#160;6.2.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Non-Signatory
Dispute"</B> shall have the meaning specified in Section&#160;21.23.15. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Non-U.S. Strategic Alliances"</B> shall have the meaning specified in Section
9.8.4.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"NWC
Permitted Dividend Amount"</B> shall mean the amount, if positive and if
any, equal to (i) the "Buyer Working Capital Amount" as defined in the
Acquisition Agreement, if any, <U>minus</U> (ii) any payments by DEI (or its
Affiliates) to Licensee Parent (or its Affiliates) pursuant to the working
capital adjustment provisions of Section 2.3 of the Acquisition Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Obligations"</B>
shall have the meaning specified in the Disney Guarantee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Opening/Closing
Proposal"</B> shall have the meaning specified in Section 9.19.1(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Operating
Manual"</B> shall have the meaning specified in Section 9.18. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Original
Debt Facility"</B> shall mean the Loan and Security Agreement between
Licensee and Wells Fargo Retail Finance, LLC, dated on or about the Effective
Date, in its original form prior to any amendment, modification or other change
thereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Original
Lease Term"</B> shall mean, with respect to any Core Store, Non-Core Store
or Disney-Guaranteed Lease, the remaining term of the Lease Agreement for such
Core Store, Non-Core Store or Disney-Guaranteed Lease, as applicable, in each
case as it existed as of the Effective Date, without regard to any renewal or
other extension of such term occurring after the Effective Date, whether
resulting from any amendment or modification of such Lease Agreement, the
exercise of any option to extend or renew such Lease Agreement, the continuation
of such Lease Agreement on a month-to-month basis or any other action taken by
any party to such Lease Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Original
Retail Price"</B> shall mean, with respect to any Disney Merchandise, the
retail price at which such Disney Merchandise is offered to the public on the
date on which such Disney Merchandise is first so offered in the Facilities
and/or the Internet Store, prior to any discount, markdown or other price
reduction. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Other
Disney Licensee"</B> shall mean any Person (other than TDSF and its
Affiliates, Licensee and its Affiliates, and any Other Disney Store Operator and
its Affiliates) that designs, develops and/or manufactures Other Licensee
Merchandise (<U>e.g.</U>, Mattel, Hasbro). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Other
Disney Store Merchandise"</B> shall mean any consumer products and
merchandise that (i) are developed by an Other Disney Store Operator pursuant to
a Contract between such Other Disney Store Operator, on the one hand, and TDSF
and/or any of its Affiliates, on the other hand, and (ii) bear, feature or
incorporate one (1) or more of the Disney Properties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Other
Disney Store Operator"</B> shall mean any Person that operates one (1) or
more retail stores under the <I>"Disney Store"</I> name in one (1) or
more locations outside of the Territory (<U>e.g.</U>, Europe, Japan, China, Hong
Kong) pursuant to a Contract between such Person, on the one hand, and TDSF
and/or any of its Affiliates, on the other hand. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Other
Licensee Merchandise"</B> shall mean any consumer products and merchandise
that (i) are developed by an Other Disney Licensee pursuant to a Contract
between such Other Disney Licensee, on the one hand, and TDSF and/or any of its
Affiliates, on the other hand, and (ii) bear, feature or incorporate one (1) or
more of the Disney Properties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Other
Real Property"</B> shall mean any real property that is not a Leased
Property, but was, is or will be used by Licensee relating to, or associated
with, the Business (<U>e.g.</U>, a Facility, a Distribution Center, a corporate
headquarters or other office, or another location, store, facility or real
property used in the Business), including, without limitation, fee simple
ownership of real property, easements, servitudes, licenses or any other real or
personal property interest affecting such real property. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Out
of Store Materials"</B> shall have the meaning specified in Section
5.2.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Outlet
Center"</B> shall mean a multi-tenant retail shopping destination that is
known, identified, promoted or held out to the public as a common or unified
complex, with the following elements and characteristics: (i) one hundred
thousand (100,000) or more gross leaseable square feet of shopping space, (ii)
substantially all tenants consisting of Outlet Stores, and (iii) a majority of
tenants consisting of Outlet Stores that offer nationally recognizable,
name-brand consumer products (<U>e.g.</U>, the Outlet Store version of Gap, Polo
Ralph Lauren, Coach, Carter&#146;s, The Children&#146;s Place, Samsonite, etc.).
For purposes of clarification, "Outlet Centers" shall include outlet
centers that are in a form and manner similar to those operated as of the
Effective Date by Mills Corporation. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Outlet
Facility"</B> shall mean a physical (not a "virtual" or online)
Outlet Store located within an Outlet Center that is owned or leased by Licensee
and operated by Licensee under the name <I>"Disney Store Outlet"
</I>or such other name as shall be approved by each of TDSF and Licensee in its
respective sole discretion, a material purpose of which is liquidating excess,
obsolete or otherwise slow-moving inventories of Disney Merchandise from Store
Facilities and/or the Internet Store. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Outlet
Store"</B> shall mean a retail store that offers products to consumers with
an emphasis on low prices, a material purpose of which is liquidating excess,
obsolete or otherwise slow-moving inventory from other related retail activities
(<U>e.g.</U>, a "Gap" outlet would liquidate inventory from the
"Gap" chain of specialty retail clothing stores). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Outstanding
Licensee Securities"</B> shall mean the Licensee Securities constituting
equity Securities outstanding as of the Effective Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Outstanding
TDS Canada Securities"</B> shall mean the TDS Canada Securities
constituting equity Securities outstanding as of the Effective Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Outstanding
TDS USA Securities"</B> shall mean the TDS USA Securities constituting
equity Securities outstanding as of the Effective Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Overhead
Assets and Operations"</B> shall have the meaning specified in
Section&#160;15.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Parent
Affiliate"</B> shall mean, with respect to any Person, an Affiliate of such
Person who owns at least a majority of the outstanding voting equity Securities
of such Person. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"party"</B> shall have the meaning set forth in the preamble to this Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Party
Designations"</B> shall have the meaning specified in
Section&#160;21.23.5(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Payment
Service Products"</B> shall mean all versions of the following, regardless
of the medium or technology used in the delivery thereof (<U>e.g.</U>, whether
via plastic cards or electronic, "smart" or chip-based, remote,
on-line, internet or wireless versions, or other methods of delivery): (i)
credit cards and charge cards; (ii) debit cards; (iii)&#160;automatic teller
machine cards; (iv) electronic funds transfer point-of-sale cards; (v) stored
value cards or prepaid cards, including reloadable cards such as payroll cards,
incentive cards and gift cards (other than Disney Stored Value Cards); (vi)
travelers checks and "TravelMoney" cards; (vii) corporate, purchasing,
distribution and travel and entertainment cards; and (viii) transaction security
services featuring payer and/or seller authentication. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Pension
Fund"</B> shall mean an "employee pension benefit plan" within
the meaning of Section 3(2) of ERISA that is either (i) subject to the
requirements of Section 403(a) of ERISA or (ii) described in Sections 3(32),
3(33) or 4(b)(4) of ERISA; <U>provided</U>, that, for purposes of this
Agreement, any Pension Fund (a) that is sponsored, established, administered,
controlled, managed or operated by a Person who would be a Disqualified Person
but for subparagraph (6) of the definition of "Disqualified Person" or
(b) the majority of the funds of which is contributed by a Person and/or the
employees of a Person who would be a Disqualified Person but for subparagraph
(6) of the definition of "Disqualified Person," shall be excluded from
the definition of "Pension Fund." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Permitted
Closings"</B> shall have the meaning specified in Section 9.3.1(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Permitted Openings"</B>
shall have the meaning specified in Section 9.3.1(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Permitted
Opening/Closing Notice"</B> shall have the meaning specified in Section
9.3.1(c). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Permitted
Openings Measurement Year"</B> shall have the meaning specified in Section
9.3.1(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Permitted
Transfer"</B> shall mean any of the following, <U>provided</U>, that each
is conducted in accordance with all applicable Laws (including all applicable
securities Laws) and subject in each case to compliance with Section 9.12.3, as
applicable: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Transfer of
Licensee Securities, Licensee Affiliate Securities, TCP Securities or TCP
Affiliate Securities by any Person pursuant to a Public Offering;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Transfer of
Licensee Securities, Licensee Affiliate Securities, TCP Securities or TCP
Affiliate Securities, in each case consisting of debt Securities only, by the
issuer thereof (<U>i.e.</U>, Licensee, the respective Licensee Affiliate, TCP or the
respective TCP Affiliate, as applicable) only to "qualified institutional
buyers" (as defined in Rule 144A) who are not Disqualified Persons, in each case
pursuant to and in accordance with Rule 144A;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Transfer
of Licensee Securities, Licensee Affiliate Securities, TCP Securities or TCP
Affiliate Securities pursuant to and in accordance with Rule 144, provided that,
in the case of each individual Transfer or series of related Transfers pursuant
to Rule 144 by any Dabah Stockholder that is conducted through a "brokers'
transaction" (as defined in Rule 144) as opposed to through a "market maker" (as
defined in Rule 144), with respect to each such individual Transfer or series of
related Transfers, no one Person or one group of Persons shall acquire more that
twenty-five percent (25%) of the aggregate amount of Securities being
Transferred pursuant to such individual Transfer or series of related
Transfers;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the grant or
issuance of TCP Securities or, following a Public Offering thereof, any Licensee
Securities, Licensee Affiliate Securities or TCP Affiliate Securities to
employees or directors of the issuer thereof (<U>i.e.</U>, Licensee, the respective
Licensee Affiliate, TCP or the respective TCP Affiliate, as applicable) pursuant
to and in compliance with the terms of any stock option, stock purchase or
similar equity plan for the benefit only of employees and/or directors of the
applicable issuer or its Affiliates, provided that this subparagraph (iv)
specifically does not relate to or cover the resale of any such Securities by
any such employee or director to another Person or group of Persons;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) the Transfer of
TCP Securities or, following a Public Offering thereof, any Licensee Securities,
Licensee Affiliate Securities or TCP Affiliate Securities by any Dabah
Stockholder (a) to his or her spouse or former spouse or lineal or legally
adopted descendants or ancestors (and their spouses), (b) to the trustee of a
trust for the principal benefit of any one (1) or more of the foregoing Persons,
(c) for other comparable estate planning purposes or (d) to any Charitable
Organization, provided that in each such case the Transferee of such TCP
Securities shall continue to be and be deemed to be a Dabah Stockholder for all
purposes of this Agreement (provided that, so long as all Charitable
Organizations in the aggregate have not received, in one (1) or more Transfers,
more than five percent (5%) of any tranche of outstanding voting TCP Securities,
then any Charitable Organization that receives, in the aggregate in one (1) or
more Transfers, no more than one percent (1.0%) of any tranche of outstanding
voting TCP Securities shall not be deemed a Dabah Stockholder);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the Transfer of
Licensee Securities or Licensee Affiliate Securities by any Person to a
Qualified Person so long as such Transfer is accompanied by a Guaranty
Assumption (as and to the extent required by TDSF in its sole discretion) and,
in the case of a Transfer involving Licensee Securities, a License Assumption
(as and to the extent determined to be necessary or prudent and therefore
required by TDSF in its business judgment);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the Transfer
of TCP Securities or TCP Affiliate Securities by any Person to a Qualified
Person; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) the Transfer
of TCP Securities or TCP Affiliate Securities by any Person to a Disqualified
Person, <U>provided</U>, that: (a) during any calendar year, the aggregate amount of
TCP Securities or TCP Affiliate Securities Transferred to Disqualified Persons
by TCP, the Dabah Stockholders and the Affiliates of TCP, taken together,
pursuant to this subparagraph (viii), shall not exceed one and one-half percent
(1.5%) of any tranche of outstanding voting TCP Securities or outstanding voting
TCP Affiliate Securities; (b) at no time shall any Disqualified Person who is
the Largest TCP Stockholder or the Largest TCP Affiliate Stockholder own,
beneficially or of record, more than nineteen percent (19%) of any tranche of
outstanding voting TCP Securities or outstanding voting TCP Affiliate
Securities; (c) at no time shall any Disqualified Person who is not the Largest
TCP Stockholder or the Largest TCP Affiliate Stockholder own, beneficially or of
record, more than twenty-five percent (25%) of any tranche of outstanding voting
TCP Securities or outstanding voting TCP Affiliate Securities; and (d) at no
time shall all Disqualified Persons, taken together in the aggregate, without
regard to whether any such Disqualified Person is or is not the Largest TCP
Stockholder or the Largest TCP Affiliate Stockholder, own, beneficially or of
record, more than thirty-three percent (33%) of any tranche of outstanding
voting TCP Securities or outstanding voting TCP Affiliate Securities. For
purposes of calculating the percentages under the preceding subparagraphs (b),
(c) and (d), the ownership of TCP Securities or TCP Affiliate Securities by a
Disqualified Person shall be included in such calculation only to the extent it
is known or, based upon diligent inquiry by Licensee and its Affiliates, should
reasonably have been known to Licensee or its Affiliates, whether based on
publicly available information (such as filings in accordance with Schedule 13D
under the Securities Exchange Act), the stock ledgers and records of Licensee or
its Affiliates, or other available sources of information. For purposes of
calculating the percentages under the preceding subparagraph (a), Licensee shall
be deemed to have knowledge of all such Transfers to Disqualified Persons and
the qualification in the preceding sentence shall be inapplicable.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
purposes of clarification, a pledge of TCP Securities as security for a margin
loan shall be deemed a Permitted Transfer hereunder so long as any sale of the
pledged TCP Securities upon foreclosure (or comparable action) upon or in
connection with such margin loan would constitute a Permitted Transfer pursuant
to one (1) or more of the preceding subparagraphs (i) through (viii) of this
definition and the terms of such margin loan are designed to ensure compliance
with one (1) or more of such provisions. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Person"</B>
shall mean any natural person or any corporation, partnership, limited
partnership, limited liability company, trust or other form of legal entity. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Pre-Approved
Merchandise Categories"</B> shall mean Hardlines, Softlines and Toys/Plush. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Pre-Exercise Notice"</B>
shall have the meaning specified in Section 2.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Pre-Existing
Percent LTM Sales"</B> shall have the meaning specified in Section
6.2.2(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Predecessor
Disney Website"</B> shall mean the online retail store located on the World
Wide Web at the TDS Internet Domains (or any replacements thereof adopted by
TDSF or its Affiliates in anticipation of the Internet Start Date) operated by
TDSF and its Affiliates prior to the Internet Start Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Premiums"</B>
shall mean Disney Merchandise intended to be distributed to customers or the
trade for free or for a nominal fee in connection with any marketing,
advertising or promotional activities under this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Primary
Disney Retail Store"</B> shall mean any self-contained physical (not
"virtual" or online) retail store(s) and/or free-standing kiosk(s)
that (i) is either (a) owned or operated by TDSF and/or any of its Affiliates or
(b) owned or leased by any unrelated third party and operated by such unrelated
third party pursuant to and in accordance with a license to use Disney-Branded
Properties granted by TDSF or its Affiliates, and (ii) either (x) is operated
and held out to the public under a name that incorporates the word
"Disney" or any Disney-Branded Property and/or (y) offers, in at least
seventy-five percent (75%) of such store&#146;s or kiosk&#146;s Public
Merchandising Space, SKUs of consumer products and merchandise that bear,
feature or incorporate one (1) or more Disney-Branded Properties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Prime
Rate"</B> shall mean the base rate on corporate loans at large United
States money center commercial banks as such rate is reported under "prime
rate" in <I>The Wall Street Journal</I> from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Priority
Designations"</B> shall have the meaning specified in
Section&#160;21.23.5(d). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Product
Design Elements"</B> shall have the meaning specified in Section&#160;11.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Product Safety
Director"</B> shall mean an employee of TDSF or its Affiliates (of such
rank or level as TDSF may determine in its sole discretion) designated by TDSF
or its Affiliates, whose sole responsibility shall consist of overseeing and
managing, on behalf of TDSF, the relationship between TDSF and Licensee with
respect to product safety guidelines and procedures pertaining to Disney
Merchandise as contemplated by this Agreement, including Section 5.1.4. The
Product Safety Director may, at the election of TDSF, consist of more than one
(1) employee of TDSF or its Affiliates. For purposes of clarification, the
Product Safety Director shall not be an employee of Licensee or its Affiliates
and shall not take directions or instructions from Licensee or its Affiliates
but rather only from TDSF and its Affiliates, notwithstanding the fact that, so
long as Licensee maintains a headquarters office in the vicinity of Burbank or
Glendale, California, the Product Safety Director shall maintain his or her
primary office at such headquarters office of Licensee (at the sole cost and
expense of Licensee) in addition to the office that may be maintained by the
Product Safety Director at the offices of TDSF or its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Product
Safety Laboratory"</B> shall mean an internationally recognized product
safety testing laboratory that (i) is selected in good faith by Licensee and
approved in writing by TDSF (such approval to be granted or denied by TDSF in
its business judgment), (ii) is a third party that is not related to or
Affiliated with Licensee or its Affiliates, except to the extent contemplated by
Section 5.1.4(f), and (iii) has received a copy of the Disney Product Guidelines
from Licensee and agreed to test the Disney Merchandise against and in
compliance with the standards contained in the Disney Product Guidelines. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Product
Trademarks"</B> shall have the meaning specified in Section&#160;11.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Promotional
Brief"</B> shall have the meaning specified in Section&#160;5.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Property-Product
Combination"</B> shall mean, with respect to a DTR License granted to a
chain of Specialty Retail Stores by TDSF or its Affiliates, the combination of
(i) a particular Character Property authorized to be used under such DTR License
and (ii) a particular DTR Product Category in connection with which such
particular Character Property is authorized to be used under such DTR License. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Proposed
Lease Agreement Notice"</B> shall have the meaning specified in Section
9.7.1(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Public
Merchandising Space"</B> shall mean, with respect to (i) any Primary Disney
Retail Store or (ii) any specialty retail store that is owned, leased, licensed,
controlled and/or operated by TCP or its Affiliates (other than Licensee Parent,
Licensee, Canadian Parent and their respective Subsidiaries), the aggregate
retail merchandising space (in square feet) that is open to the general public
(<U>i.e.</U>, excluding stock rooms, restrooms and other non-public or
non-retail space). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Public
Offering"</B> shall mean an underwritten public offering of any Licensee
Securities, Licensee Affiliate Securities, TCP Securities or TCP Affiliate
Securities pursuant to an effective registration statement under the Securities
Act, <U>provided</U>, that such Public Offering shall comply with the following
conditions: (i)&#160;in the case of a Public Offering of Licensee Securities or
Licensee Affiliate Securities, (a)&#160;such Public Offering shall not be filed
with the Securities and Exchange Commission or otherwise commenced at any time
prior to the end of the second (2<FONT SIZE=1>nd</FONT>) Contract Year, and (b)&#160;such
Public Offering shall generate aggregate gross proceeds, before deduction of
selling commissions and expenses, of at least Twenty Million Dollars
($20,000,000), and (ii)&#160;such Public Offering shall be made to the general
public and not to a select or targeted group of investors. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Publishing
Properties"</B> shall mean children-oriented publications that are produced
and/or distributed by TDSF or any of its Affiliates under the "Disney
Adventures" and "Disney Magazine" label or any other label that
incorporates the name "Disney" or any variation thereof, but
specifically excluding any other publications that are produced and/or
distributed by TDSF or any of its Affiliates, such as, by way of illustration
and without limitation, publications produced and/or distributed under the
Hyperion label. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Purchase
Commencement Date"</B> shall have the meaning specified in
Section&#160;15.1.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Purchase
Price"</B> shall mean, with respect to any Disney Merchandise, an amount
equal to the retail price at which such Disney Merchandise is offered to the
public on a particular date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Purchase
Process"</B> shall have the meaning specified in Section&#160;15.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Qualified
Person"</B> shall mean any Person who is not a Disqualified Person. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Qualifying
Strip Center"</B> shall mean a quality multi-tenant retail shopping
destination that is known, identified, promoted or held out to the public as a
common or unified complex, with the following elements and characteristics: (i)
one hundred thousand (100,000) or more gross leaseable square feet of retail
shopping space, (ii) two (2) or more Specialty Retail Stores (in addition to any
Store Facility), (iii) a full-priced retail image (as opposed to a discount
image), except for periodic promotional and seasonal sales, and (iv) a layout or
design that is generally oriented toward a public street or thoroughfare. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Quarterly
Merchandise Plan"</B> shall have the meaning specified in Section 9.6.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Refurbishments"</B>
shall have the meaning specified in Section 9.3.5(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Release
Year"</B> shall have the meaning specified in Section 9.9.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Remainder
Amount"</B> shall have the meaning specified in Section&#160;15.2.3(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Renewal
Term"</B> shall have the meaning specified in Section&#160;2.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Representatives"</B>
shall mean, with respect to any Person, the officers, directors, employees,
managers, partners, agents, consultants, advisors (including legal advisors,
financial advisors and accountants), contractors and subcontractors of such
Person. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Reproductions"</B>
shall have the meaning specified in Section 9.9.12. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Required
Product"</B> shall have the meaning specified in Section 9.9.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Response Failure"</B>
shall have the meaning specified in Section 5.1.1(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Response
Failure Fee"</B> shall have the meaning specified in Section 5.1.1(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Restaurant"</B>
shall have the meaning specified in Section&#160;5.2.8(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Restricted
Name"</B> shall mean solely the names "Disney Store," "Disney Boutique," "Disney
Emporium," "Disney Market," "Disney Mart," "Disney Shop," "Disney Place" and
"Disney Stop," and no other names. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Retail
Facilities"</B> shall mean retail shopping mall, outlet center or strip
mall facilities primarily focused on retail sales of consumer products. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Retail
Month"</B> shall mean a month in a "retail" Fiscal Year
consisting of a four (4) or five (5) week period, as applicable, beginning on a
Sunday closest to the last day of a calendar month and ending on a Saturday and
corresponding with the generally accepted retail calendar. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"<B>Revolving
Loans</B>" shall have the meaning specified in Section&#160;9.17.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Royalty
Breach"</B> shall mean the failure by Licensee to make any payment required
to be made by Licensee pursuant to Section 7. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Rule
144"</B> shall mean Rule 144 of the General Rules and Regulations
promulgated under the Securities Act, as in effect from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Rule
144A"</B> shall mean Rule 144A of the General Rules and Regulations
promulgated under the Securities Act, as in effect from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Schedules"</B>
shall mean those certain schedules to this Agreement that have been separately
delivered by TDSF to Licensee concurrently with the execution of this Agreement
and with reference to this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"SEC"</B>
shall mean the United States Securities and Exchange Commission or any
successor. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Second
Largest TCP Affiliate Stockholder"</B> shall mean, with respect to each
Affiliate of TCP (other than Licensee, Licensee Parent, Canadian Parent and the
Subsidiaries of Licensee, Licensee Parent and Canadian Parent), the Person or
group of Persons whose beneficial ownership (within the meaning of Rule 13d-3
under the Securities Exchange Act) of voting TCP Affiliate Securities of such
Affiliate of TCP entitles it to the second largest vote (after the Largest TCP
Affiliate Stockholder) in the election of the board of directors (or comparable
governing body) of such Affiliate of TCP among all holders of TCP Affiliate
Securities of such Affiliate of TCP. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Second
Largest TCP Stockholder"</B> shall mean the Person or group of Persons
whose beneficial ownership (within the meaning of Rule 13d-3 under the
Securities Exchange Act) of voting TCP Securities entitles it to the second
largest vote (after the Largest TCP Stockholder) in the election of TCP&#146;s
board of directors (or comparable governing body) among all holders of TCP
Securities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Secured
Lender"</B> shall mean any lender under the Debt Facilities of Licensee
and/or its Subsidiaries entered into in accordance with Section 9.17.2 that has
taken a security interest in Licensee&#146;s and/or its Subsidiaries&#146;
inventory, accounts receivable and/or assets of the Business, including, without
limitation, Wells Fargo Retail Finance, LLC, under the Original Debt Facility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Securities"</B>
shall mean any and all debt and equity securities and other ownership interests
in whatever form, including, without limitation, common stock or shares,
preferred stock or shares or other capital stock, membership, partnership or
participation interests or units, and notes, bonds, debentures or other similar
debt instruments, including, without limitation, any securities, warrants,
options or rights convertible into or exercisable or exchangeable for any of the
foregoing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Securities
Act"</B> shall mean the Securities Act of 1933, as amended, and the rules
and regulations thereunder, or any similar successor statute. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Securities
Exchange Act"</B> shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder, or any similar successor
statute. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Securities
Filings"</B> shall have the meaning set forth in Section 9.11.6. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Select
Street Location"</B> shall mean any quality shopping street located within
a major metropolitan area or notable resort district (<U>e.g.</U>, State Street
in Chicago, Illinois; 86<FONT SIZE=1>th</FONT>> Street in Manhattan, New York; Hollywood
Boulevard in Los Angeles, California) that includes three (3) or more Specialty
Retail Stores (in addition to any Store Facility) located on the same street as,
and within one-quarter (&#188;) mile of, any Store Facility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Shopping
Mall"</B> shall mean a multi-tenant retail shopping destination that is
known, identified, promoted or held out to the public as a common or unified
complex, with the following elements and characteristics: (i)&#160;five hundred
thousand (500,000) or more gross leaseable square feet of retail shopping space,
(ii)&#160;one (1) or more Department Stores, (iii)&#160;one (1) or more
Specialty Retail Stores (in addition to any Store Facility) that occupy, in the
aggregate, at least one hundred fifty thousand (150,000) gross leaseable square
feet, (iv)&#160;numerous other retail stores offering a wide variety of products
and services, such as apparel, shoes, jewelry, toys, sporting goods, books and
music, each operated by a separate merchant tenant, (v)&#160;at least one (1)
entertainment venue, such as a restaurant, food court or movie theater,
(vi)&#160;a full-priced retail image (as opposed to a discount image), except
for periodic promotional and seasonal sales, and (vii)&#160;a self-contained
layout with an enclosed structure or a format organized around an interior
courtyard or private pedestrian street system, in either case such that the
shopping experience is not open to public streets or thoroughfares. Without
limiting the foregoing and for purposes of clarification, "Shopping
Mall" shall not include any "strip mall" (i.e., a collection of
retail outlets generally oriented toward a public street or thoroughfare), any
Outlet Center, life-style center or any shopping destination that is organized
around public streets (<U>e.g.</U>, "Main Street" in any downtown
location). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Short-Term
Lease"</B> shall mean a Lease Agreement providing for the operation of a
Facility under a month-to-month tenancy or for a full term or short-term renewal
of two (2) years or less. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Significant
Subsidiary"</B> shall have the meaning specified in subparagraph (w) of
Section 210.1-02 of Regulation S-X promulgated by the SEC, as amended, modified
or replaced from time to time. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Silver
Pass Holders"</B> shall have the meaning specified in Section&#160;20.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"SK
Entities"</B> shall mean The SK Equity Fund, L.P., the SK Investment Fund,
L.P. and each of their respective Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"SKU"</B>
shall mean a stock keeping unit. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Softlines"</B>
shall mean those categories of softline consumer products set forth on
<U>Schedule 1(f)</U>, as such <U>Schedule 1(f)</U> may be amended from time to
time with the approval of TDSF and Licensee in their respective sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Specialty
Retail Store"</B> shall mean a retail store that is known, identified,
promoted or held out to the public as being part of a chain of retail stores
with the following elements and characteristics: (i) all stores in the chain
operate under the same nationally or regionally recognizable brand name
(regardless of whether such stores are operated by one owner or by different
franchisees), (ii) the chain consists of more than eighty (80) retail stores
(or, for purposes of the limitations on DTR Licenses granted by TDSF and/or its
Affiliates to one (1) or more chains of Specialty Retail Stores set forth in
Section 6.2.2, the chain consists of more than sixty (60) retail stores), (iii)
the average size of stores within the chain is less than twenty thousand
(20,000) gross leaseable square feet, (iv) all stores within the chain primarily
offer Softlines and/or Hardlines with a specific emphasis on one category or
type of consumer product (<U>e.g.</U>, apparel, cookware, electronics, music,
etc.) as opposed to a wide variety of consumer products organized by department
or otherwise, such as in a Department Store, and (v) the stores within the chain
generally offer merchandise on a full-retail pricing model rather than a
discount or warehouse pricing model, except for periodic promotional and
seasonal sales. As of the Effective Date, examples of "Specialty Retail
Stores" shall be deemed to include Gap, Banana Republic, Old Navy, Baby
Gap, The Children&#146;s Place, Gymboree, Spencer Gifts, The Limited, Express,
Victoria&#146;s Secret, Bath and Body Works, Williams-Sonoma, Abercrombie &amp;
Fitch, KB Toys, Hallmark, Dress Barn, Fashion Bug, Stride-Rite, Radio Shack and
Sam Goody. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Store
Facility"</B> shall mean a physical (not a "virtual" or online)
specialty retail store that (i) is located in a Shopping Mall, a Select Street
Location or a Qualifying Strip Center, (ii) operates on a stand-alone basis only
(<U>i.e.</U>, as opposed to a Store-Within-a-Store Format), (iii) offers a
variety of Disney Merchandise in a general emporium format, (iv)&#160;does not
offer for sale, feature or sell any goods, products, merchandise, services or
other items other than Disney Merchandise, and (v) is owned or leased by
Licensee and operated by Licensee under the <I>"Disney Store"</I> name
in a form, manner and style that is substantially similar to the form, manner
and style in which such stores were operated by TDSF or its Affiliates under the
<I>"Disney Store"</I> name immediately prior to the Effective Date
(with any modifications to such form, manner and style as may be approved by
each of TDSF and Licensee in its respective sole discretion following the
Effective Date or as are otherwise permitted by, and are in accordance with, the
provisions of this Agreement). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Store-Within-a-Store
Format"</B> shall mean a retail location that is designated or identified
as a self-contained shop, section, department or division within a larger store,
such as a "Disney" shop, section, department or division within a
Wal-Mart, Target, Sears or JC Penney store. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Stored
Value Card Fee"</B> shall have the meaning specified in
Section&#160;9.9.11(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Stored
Value Card Fee Rate"</B> shall have the meaning specified in
Section&#160;9.9.11(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Strategic
Alliances"</B> shall have the meaning specified in Section&#160;9.8.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Strike
Notice"</B> shall have the meaning specified in Section&#160;21.23.5(c). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Stub
Period"</B> shall have the meaning specified in Section&#160;2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Subsequent
Closing"</B> shall have the meaning specified in the Acquisition Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Subsequent Closing
Date"</B> shall have the meaning specified in the Acquisition Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Subsequent
Closing Period"</B> shall have the meaning specified in the Acquisition
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Subsidiaries"</B>
shall mean, as to any Person, a corporation, partnership, limited liability
company or other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to elect a
majority of the directors, managers or trustees of such corporation,
partnership, limited liability company or other entity are at the time owned, or
the management of which is otherwise controlled, directly or indirectly through
one or more intermediaries, or both, by such Person. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Tax"</B>
or <B>"Taxes"</B> shall mean (i)&#160;any and all federal, state,
provincial, local, municipal and foreign taxes, assessments and other
governmental charges, duties, impositions and liabilities of any kind, including
taxes or other charges based upon or measured by gross receipts, income,
profits, sales, capital, use and occupation, and value added, goods and
services, ad valorem, transfer, franchise, withholding, payroll, recapture,
employment, personal property, excise, duty, customs and real estate taxes, and,
in addition to the foregoing, with respect to TDS Canada, Canada Pension Plan
and provincial pension plan contributions, employment and unemployment insurance
contributions, worker&#146;s compensation and deductions at source, together, in
each case, with all interest, penalties and additions imposed with respect to
such amounts; (ii)&#160;any liability for the payment of any amounts of the type
described in subparagraph (i)&#160;as a result of being a member of an
affiliated, consolidated, combined or unitary group for any period; and
(iii)&#160;any liability for the payments of the amounts of the types described
in subparagraph (i)&#160;or (ii) as a result of being a transferee of, or a
successor in interest to, any Person or as a result of an express or implied
obligation to indemnify any Person (other than any indemnification obligation
arising under this Agreement). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Tax
Return"</B> shall mean a report, return or other information or form
required to be supplied to a Governmental Entity with respect to Taxes,
including, without limitation, where permitted or required, combined or
consolidated returns for any group of entities that includes any Affiliate. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP"</B>
shall mean The Children&#146;s Place Retail Stores, Inc., a Delaware corporation
and the parent of Licensee Parent and the indirect parent of Licensee and
Canadian Parent. Following the Effective Date, any Affiliate of TCP who becomes
an Obligor or an Affiliate Guarantor (each as defined in the TCP Guaranty and
Commitment) under the TCP Guaranty and Commitment pursuant to the definition of
"TCP" therein or Section 4(m) thereof, respectively, shall be subject
to the obligations, restrictions and provisions pertaining to TCP hereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP
Affiliate Securities"</B> shall mean Securities of any Subsidiary of TCP
other than Licensee, Licensee Parent, Canadian Parent and the Subsidiaries of
Licensee, Licensee Parent and Canadian Parent, in whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP
Characters"</B> shall have the meaning specified in Section&#160;6.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP Entities"</B>
shall have the meaning specified in Section&#160;9.13.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP
Guaranty and Commitment"</B> shall mean the Guaranty and Commitment of even
date herewith entered into by TCP and Licensee Parent in favor of Licensee and
TDSF, pursuant to which TCP and Licensee Parent have jointly and severally
guaranteed the obligations of Licensee under this Agreement and all other
Contracts from time to time executed and/or delivered in connection herewith
(including, without limitation, any applicable agreements between TDSF, Licensee
and/or their respective Affiliates with respect to the provision of certain
administrative, distribution and/or information technology services on a
transitional basis and/or the operation of the Disney Retained Stores) and
committed to invest certain funds in Licensee to support such obligations and
Licensee&#146;s operation of the Facilities and the Internet Store hereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP
Intercompany Services Agreement"</B> shall mean the Intercompany Services
Agreement of even date herewith among TCP and/or its Affiliates, on the one
hand, and Licensee and/or its Subsidiaries, on the other hand, in substantially
the form set forth in <U>Schedule 1(g)</U>, pertaining to the provision by TCP
and/or its Affiliates (other than Licensee and its Subsidiaries) of certain
management, administrative, support and other services to Licensee and its
Subsidiaries in connection with Licensee&#146;s operation of the Business and
the allocation of costs to Licensee and its Subsidiaries in connection
therewith. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP
Securities"</B> shall mean Securities of TCP in whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TCP Tax
Sharing Agreement"</B> shall mean an intercompany agreement among TCP,
Licensee and their respective Subsidiaries pertaining to the allocation of
responsibility for tax liability among such parties, which agreement shall
contain terms and conditions that are customary for agreements of such nature.
Such agreement, together with any amendments, modifications, waivers, renewals,
replacements or other changes thereto or thereunder, shall be subject to the
approval of TDSF in its business judgment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS
Canada"</B> shall mean The Disney Store (Canada) Ltd., a corporation
incorporated under the laws of the Province of Ontario, until (i) the Canada
Reincorporation as contemplated by Section 9.12.1(a)(III), whereupon TDS Canada
shall refer to Hoop Canada, Inc., a corporation incorporated under the laws of
the Province of New Brunswick, and (ii) the execution and delivery of the
Canadian Joinder as contemplated by Section 9.12.1(a)(II), whereupon TDS Canada
shall refer individually and collectively to Hoop Canada, Inc. and New Canadian
Limited Partnership. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS
Canada Securities"</B> shall mean Securities of TDS Canada in whatever
form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS
Internet Domains"</B> shall mean, collectively, the Internet domain name
<U>www.disneystore.com</U> together with any substantially similar Internet
domain names that use the words "Disney" and "store" in
combination and that are owned and controlled by TDSF or its Affiliates
(<U>e.g.</U>, <U>www.disneystores.com</U>, <U>www.thedisneystore.com</U>). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS
USA"</B> shall have the meaning specified in the preamble to this
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS
USA Merger"</B> shall have the meaning specified in
Section&#160;9.12.1(a)(I). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDS
USA Securities"</B> shall mean Securities of TDS USA in whatever form. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDSF"</B>
shall have the meaning specified in the preamble to this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDSF
Advisors"</B> shall have the meaning specified in Section&#160;8.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDSF Flagship
Stores"</B> shall have the meaning specified in Section&#160;6.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDSF
Self-Help Cure"</B> shall have the meaning specified in
Section&#160;9.10.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDSF
Self-Help Fund"</B> shall have the meaning specified in
Section&#160;9.10.3(a). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDSF
Self-Help Fund Amount"</B> shall have the meaning specified in
Section&#160;9.10.3(c). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TDSF/Affiliate
Store"</B> shall have the meaning specified in Section&#160;9.9.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Television
Properties"</B> shall mean all children-oriented television programs (whether
made for broadcast television, cable television or any other form of television
programming) that feature in their title the name "Disney" or any variation
thereof, such as, by way of illustration and not limitation, "Wonderful World of
Disney" and "Disney&#146;s Kim Possible", which programs are produced and/or
distributed by TDSF or any of its Affiliates, but specifically excluding any
other television programs that are produced and/or distributed by TDSF or any of
its Affiliates, such as, by way of illustration and without limitation,
television programs such as "The Bachelor", "8 Simple Rules for Dating My
Teenage Daughter" and other television programs made for broadcast on the ABC
Television Network or any television programs produced and/or distributed on the
Disney Channel that do not feature in their title the name "Disney." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Template"</B>
shall have the meaning specified in Section&#160;5.2.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Temporary
Liquidation Store"</B> shall mean a retail store, a material purpose of
which is liquidating excess, obsolete or otherwise slow-moving inventory from
the DDM Business and/or any Theme Parks, hotels, motels, condominiums, Disney
Vacation clubs or other time-share style accommodations or comparable lodging
establishments owned, leased, licensed, controlled and/or operated by or on
behalf of TDSF and/or any of its Affiliates, that is operated on a periodic and
temporary basis (<U>i.e.,</U> for a period not exceeding one hundred twenty-five
(125) days at any particular location during any calendar year). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Term"</B>
shall mean, collectively, the Initial Term and any and all Renewal Terms, as
applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Term
Loans"</B> shall have the meaning specified in Section&#160;9.17.2(b). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Territory"</B>
shall have the meaning specified in Section&#160;3.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Theatrical
Properties"</B> shall mean children-oriented theatrical stage plays that
are produced and/or operated by TDSF or any of its Affiliates and that either
are derived directly from a Motion Picture Property or Television Property or
bear in their title the name "Disney" or any variation thereof, such
as, by way of illustration and not limitation, "Disney&#146;s The Lion
King" and "Disney&#146;s Beauty and the Beast" theatrical stage
plays, but specifically excluding any other theatrical stage plays that are
produced and/or distributed by TDSF or any of its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Theme
Park"</B> shall mean either an individual facility or a group, district or other
assemblage of facilities that is known, identified, promoted or held out to the
public as a common or unified complex, in either case offering amusement-style
attractions and/or rides (<U>e.g.</U>, roller coasters, "Space Mountain,"
"It&#146;s a Small World," or the "Jaws" attraction at Universal Studios Theme
Park) and/or other substantially similar forms of entertainment, regardless of
whether a fee is charged to gain entry or admission thereto; <U>provided</U>,
that "Theme Park" shall not include (i) any local, county or state fairs,
sporting arenas or sporting events or museums or (ii) any facilities that offer
amusement-style attractions and/or rides but with respect to which the offering
of such amusement-style attractions and/or rides does not comprise more than, in
the case of Retail Facilities, fifteen percent (15%), and in the case of all
other facilities, five percent (5%), of the total square footage of such
facilities that is open to the general public (<U>e.g.</U>, a gambling casino,
such as the New York, New York hotel and casino in Las Vegas, that offers
amusement-style rides or games in one portion of the lobby of the casino),
provided that the carveouts described in this subparagraph (ii) shall not apply
to any facility that is adjacent to, contained within, or held out to the public
as being a part of, a facility that is a "Theme Park" within the terms of this
definition. By way of example, and for illustration purposes only, the following
venues (and all components thereof) are Theme Parks for the purposes of this
definition: MAGIC KINGDOM&#174; Park, DISNEYLAND&#174; Resort, WALT DISNEY
WORLD&#174; Resort, DISNEYLAND Resort PARIS, Cedar Point, Six Flags, LEGOland,
Busch Gardens, Universal&#174; Studios and Sea World&#174;. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Theme
Park Admission Passes"</B> shall have the meaning specified in Section
9.9.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Third
Party Offer"</B> shall have the meaning specified in
Section&#160;15.2.2(d). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Third
Party Purchaser"</B> shall have the meaning specified in
Section&#160;15.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Toys/Plush"</B>
shall mean those categories of toy and plush toy products set forth on
<U>Schedule 1(h)</U>, as such <U>Schedule 1(h)</U> may be amended from time to
time with the approval of TDSF and Licensee in their respective sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Trademarks"</B>
shall mean all names, trademarks, service marks, logos, brands and other
comparable proprietary designations, including all registrations thereof and
applications for registrations thereof anywhere in the world, and all goodwill
associated therewith. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Transfer"</B>
shall mean any issuance, sale, transfer, assignment, subletting, hypothecation,
pledge as security or collateral, Encumbrance or other disposition, in whole or
in part, whether voluntarily or involuntarily, whether by gift, bequest or
otherwise. In the case of a hypothecation, pledge or Encumbrance, the Transfer
shall be deemed to occur both at the time of the initial pledge and at any
pledgee&#146;s sale, any sale by any secured creditor, or any retention by any
secured creditor of the pledge assets in complete or partial satisfaction of the
indebtedness for which such assets are security. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"TWDC"</B>
shall mean The Walt Disney Company, a Delaware corporation and an Affiliate of
TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Uncured"</B>
shall mean that a Cure has not occurred in the manner or in the time periods
contemplated by the definition of "Cure" set forth in this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"URL"</B>
shall mean uniform resource locator. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"ValueLink
Agreement"</B> shall mean the Enterprise Stored Value Card Agreement, dated
as of September 9, 2004, by and between Disney Gift Card Services, Inc., a
Virginia corporation, and ValueLink, LLC, a Delaware limited liability company. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"ValueLink
Participation Agreement"</B> shall mean a participation agreement, as
contemplated by the ValueLink Agreement, regarding participation in the gift
card program established pursuant to the ValueLink Agreement by Persons who are
not Affiliates of Disney Gift Card Services, Inc. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Visa"</B>
shall mean, collectively, Visa U.S.A. Inc., a non-stock membership corporation
organized under the laws of the State of Delaware, and Visa International
Service Association, a non-stock membership corporation organized under the laws
of the State of Delaware. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Visa
Agreement"</B> shall mean the Master Promotional and Sponsorship Agreement,
effective as of April 30, 2002, as amended, by and between Visa and Disney
Worldwide Services, Inc., a Florida corporation and an Affiliate of TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Visa
Payment Service Products"</B> shall mean Payment Service Products operated,
managed and controlled by Visa and/or its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Walled
Store-Within-a-Store"</B> shall mean a retail location that has a
Store-Within-a-Store Format and that is demarcated by walls of at least six (6)
feet in height on at least three (3) sides of the retail location. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"WALT
DISNEY WORLD Resort"</B> shall mean the entertainment, recreation and
lodging complex located in Orange County and Osceola County, Florida, known as
the WALT DISNEY WORLD&#174; Resort, one of the principal features of which is
the operation of four (4) separately gated theme and amusement parks known as
MAGIC KINGDOM&#174; Park, EPCOT&#174;, Disney-MGM Studios and DISNEY&#146;S
ANIMAL KINGDOM&#174; Theme Park. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Wind
Down Procedures"</B> shall have the meaning specified in Section 9.3.1(c). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Withdrawal
Date"</B> shall have the meaning specified in Section&#160;4.9. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Withdrawal Determination"</B> shall have the meaning specified in
Section&#160;4.9. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>"Working
Capital"</B> shall mean, at any date, the sum of all current assets
reflected on a consolidated balance sheet of Licensee, Licensee Parent, Canadian
Parent and their respective Subsidiaries prepared in accordance with GAAP,
<U>minus</U> the sum of all current liabilities reflected on such consolidated
balance sheet. </FONT></P>

<P><FONT SIZE=3>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>TERM OF AGREEMENT</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <U>Initial Term</U>.
The initial term of this Agreement (the <B>"Initial Term"</B>) shall
commence effective as of the Effective Date and, unless earlier terminated or
extended as herein provided, shall terminate on the date that is the last day of
the sixtieth (60<FONT SIZE=1>th</FONT>) Fiscal Quarter of Licensee measured from the
later to occur of either: (i) January&#160;31, 2005, or (ii) the first day after
the end of the Fiscal Quarter of TCP in which the Effective Date occurs (such
date in subparagraph (i) or (ii), the <B>"Contract Year Start
Date"</B>). For purposes of this Agreement, the period (if any) commencing
on the Effective Date and ending on the day prior to the Contract Year Start
Date is referred to herein as the <B>"Stub Period"</B> and each period
of four Fiscal Quarters of Licensee commencing on the Contract Year Start Date
or on any anniversary of the Contract Year Start Date during the Term is
referred to herein as a <B>"Contract Year</B>.<B>"</B> Notwithstanding
the foregoing, the Term as it pertains to Licensee&#146;s rights with respect to
the Internet Store shall be subject to Section&#160;4.3.6. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <U>Renewal Terms</U>.
The Initial Term may be extended for one (1) or more additional terms (each, a
<B>"Renewal Term"</B>), subject to and in accordance with the
following terms and conditions: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.1 <U>Conditional
Renewal Terms</U>. Subject to Licensee&#146;s satisfaction of the conditions set
forth below in this Section 2.2.1, Licensee shall be entitled, in its sole
discretion, to exercise up to three (3) Renewal Terms of ten (10) Contract Years
each (for a total of thirty (30) additional Contract Years beyond the Initial
Term if all such Renewal Terms are exercised by Licensee). In order to exercise
any such Renewal Term, Licensee shall provide TDSF with written notice stating
that Licensee is considering exercising such Renewal Term (the
<B>"Pre-Exercise Notice"</B>) at any time during the first three (3)
months of the eleventh (11<FONT SIZE=1>th</FONT>) Contract Year (in the case of the first
such Renewal Term) or, if applicable (assuming the first Renewal Term became
effective in accordance with the terms of this Section 2.2.1), during the first
three (3) Retail Months of the twenty-first (21<FONT SIZE=1>st</FONT>) Contract Year (in
the case of the second Renewal Term, if applicable) or, if applicable (assuming
the first and second Renewal Terms became effective in accordance with the terms
of this Section&#160;2.2.1), during the first three (3) Retail Months of the
thirty-first (31<FONT SIZE=1>st</FONT>) Contract Year (in the case of the third Renewal
Term, if applicable). Within three (3) Retail Months following such written
notice from Licensee, TDSF shall provide written notice to Licensee indicating
whether or not the conditions to the effectiveness of the applicable Renewal
Term set forth below in this Section 2.2.1 have been satisfied. If such
conditions have been satisfied, then the applicable Renewal Term shall be deemed
effective, and the Term of this Agreement shall be deemed to have been extended
by such Renewal Term, upon written notice from Licensee stating that Licensee
desires to exercise such Renewal Term (the <B>"Exercise Notice"</B>),
which Exercise Notice must be given by Licensee on or prior to the last day of
the eleventh (11<FONT SIZE=1>th</FONT>) Contract Year (in the case of the first such
Renewal Term) or, if applicable (assuming the first Renewal Term became
effective in accordance with the terms of this Section 2.2.1), on or prior to
the last day of the twenty-first (21<FONT SIZE=1>st</FONT>) Contract Year (in the case of
the second Renewal Term, if applicable) or, if applicable (assuming the first
and second Renewal Terms became effective in accordance with the terms of this
Section&#160;2.2.1), on or prior to the last day of the thirty-first
(31<FONT SIZE=1>st</FONT>) Contract Year (in the case of the third Renewal Term, if
applicable). If such conditions have not been satisfied, such Renewal Term shall
be deemed ineffective for all purposes hereunder. Notwithstanding anything to
the contrary contained herein, no Renewal Term contemplated by this
Section&#160;2.2.1 may be exercised by Licensee, and the Initial Term shall not
be extended by any such Renewal Term, unless each of the following conditions
shall have been satisfied, as determined by TDSF in its reasonable discretion: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) During, in the
case of the first such Renewal Term, the Stub Period and the first (1st) through
the tenth (10th) Contract Years of the Term, inclusive, or, in the case of the
second such Renewal Term, if applicable, the eleventh (11th) through the
twentieth (20th) Contract Years of the Term, inclusive, or, in the case of the
third such Renewal Term, if applicable, the twenty-first (21st) through the
thirtieth (30th) Contract Years of the Term, inclusive (each, a "<B>Measurement
Period</B>"), Net Retail Sales shall have grown at an average annual compound rate
equal to the increase, if any, in the CPI during each Contract Year of the
Measurement Period calculated in accordance with the CPI Adjustment Methodology,
with the first (1st) Contract Year to be treated as the base Contract Year for
the first Measurement Period and, if applicable, the tenth (10th) Contract Year
to be treated as the base Contract Year for the second Measurement Period and,
if applicable, the twentieth (20th) Contract Year to be treated as the base
Contract Year for the third Measurement Period;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) During the
applicable Measurement Period, Licensee shall not have committed (i) any Uncured
Royalty Breach, (ii) such number of Cured or Uncured Royalty Breaches as would
permit TDSF to terminate this Agreement pursuant to subparagraph (ii) or (iii)
of Section 13.1, (iii) any Uncured Licensee Infringing Use, (iv) more than four
(4) Cured Licensee Infringing Uses, (v) more than two (2) Uncured Material
Breaches (other than Royalty Breaches), or (vi) more than six (6) Cured Material
Breaches (other than Royalty Breaches);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) During the
applicable Measurement Period, neither TCP nor Licensee Parent shall have
breached any material term, covenant or condition that is binding upon TCP or
Licensee Parent under the TCP Guaranty and Commitment and failed to cure such
breach within ten (10) Business Days following written notice of such breach
from TDSF, Licensee or any of their respective Affiliates;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) As of the first
day of the eleventh (11th) Contract Year, in the case of the first such Renewal
Term, or, in the case of the second such Renewal Term, if applicable, as of the
first day of the twenty-first (21st) Contract Year, or, in the case of the third
such Renewal Term, if applicable, as of the first day of the thirty-first (31st)
Contract Year, there shall not be (i) any Uncured Material Breach by Licensee
(except as otherwise permitted by the preceding subparagraph (b)(v)) or any
Uncured Licensee Infringing Use (and, for purposes of clarification, the
condition in this subparagraph (i) shall not be deemed to have failed until the
expiration of the applicable Cure period with respect to Licensee's Material
Breach or the Licensee Infringing Use), nor (ii) any breach by TCP and/or
Licensee Parent of any material term, covenant or condition that is binding upon
TCP, Licensee Parent or their Affiliates under the TCP Guaranty and Commitment
or any breach by TCP and/or Licensee Parent of any material representation or
warranty of TCP or Licensee Parent made under the TCP Guaranty and Commitment,
in each case which breach is not cured by TCP or Licensee Parent within ten (10)
Business Days following written notice of such breach from TDSF, Licensee or any
of their respective Affiliates (and, for purposes of clarification, the
condition in this subparagraph (ii) shall not be deemed to have failed until the
expiration of such ten (10) Business Day period);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) As of the last
day of each of the last two (2) Fiscal Years of Licensee completed during the
applicable Measurement Period, Licensee shall have been in compliance with the
financial covenant set forth in <U>Schedule 1(a)</U> (the "<B>Financial Covenant</B>");
and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Prior to or
concurrently with the delivery of Licensee's Pre-Exercise Notice, TCP and
Licensee Parent shall have delivered a written statement to TDSF, in form and
substance reasonably satisfactory to TDSF, confirming that, upon the
effectiveness of the applicable Renewal Term, (i) the TCP Guaranty and
Commitment shall be deemed to have been renewed for such Renewal Term, (ii) all
of the provisions of the TCP Guaranty and Commitment (including, without
limitation, the remaining capital commitment under Section 2 thereof) shall
continue in full force and effect during such Renewal Term and (iii)
notwithstanding any payments made by TCP and/or Licensee Parent during the
Initial Term or any prior Renewal Term pursuant to the guaranty under Section 3
of the TCP Guaranty and Commitment, such guaranty shall be equal to Twenty-Five
Million Dollars ($25,000,000) for such Renewal Term, whether or not any payment
had previously been made thereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.2 <U>Negotiated
Renewal Terms</U>. During a six (6) month period of time (or such longer period
of time as the parties may consent to in writing in their respective sole
discretion) that shall begin (a) twenty (20) Business Days following the
determination that a Renewal Term will not become effective pursuant to Section
2.2.1, whether due to Licensee&#146;s failure to deliver the Pre-Exercise Notice
or the Exercise Notice within the specified time, Licensee&#146;s notice that it
will not exercise such rights, or TDSF&#146;s determination that the conditions
required to exercise such Renewal Term have not been satisfied, or (b) if all
Renewal Terms under Section 2.2.1 have been previously exercised, on the date
that is four (4) years prior to the expiration date of the Term, TDSF and
Licensee shall enter into good faith negotiations regarding the terms and
conditions upon which they may be willing to enter into a Renewal Term of such
duration as to which the parties may agree. Each of TDSF and Licensee shall be
entitled to decide whether to enter into any such Renewal Term in its sole
discretion and may terminate such discussions following such six (6) month
period without recourse or remedy by the other party and without any abatement
or reduction of any payments or other obligations hereunder. Any agreement
reached under this Section 2.2.2 shall be memorialized in a written agreement or
amendment to this Agreement. Notwithstanding the foregoing, TDSF shall not be
required to conduct the negotiations contemplated by this Section 2.2.2 or, if
already commenced, shall be entitled to terminate such negotiations in the event
that, at any time prior to or during such six (6) month negotiating period, TCP
or Licensee declines to enter into such good faith negotiations (or otherwise
withdraws from such negotiations) or, during such six (6) month negotiating
period or the twelve (12) month period immediately preceding such negotiating
period, (X) Licensee shall have committed (i) any Uncured Royalty Breach, (ii)
any Uncured Licensee Infringing Use, (iii)&#160;more than two (2) Cured Licensee
Infringing Uses, (iv) more than two (2) Uncured Material Breaches (other than a
Royalty Breach), or (v) more than three (3) Cured Material Breaches (other than
a Royalty Breach), or (Y) either of TCP or Licensee Parent shall have breached
any material term, covenant or condition that is binding upon TCP or Licensee
Parent under the TCP Guaranty and Commitment and shall have failed to cure such
breach within ten (10) Business Days following written notice of such breach
from TDSF, Licensee or any of their respective Affiliates. </FONT></P>

<P><FONT SIZE=3>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>TERRITORY</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <U>Definition of
Territory</U>. The territory covered by this Agreement and in which Licensee may
exercise the rights granted to it hereunder shall consist of and be limited
solely to (i) the United States of America and its territories and possessions,
including Puerto Rico but excluding the Commonwealth of Northern Mariana Islands
and Palau, and (ii) Canada (collectively, the <B>"Territory"</B>). For
purposes of clarification and without limiting the foregoing, Licensee
acknowledges and agrees that other third parties currently operate specialty
retail chains under the <I>"Disney Store"</I> name offering consumer
products featuring one (1) or more Disney Properties outside of the Territory
(<U>e.g.</U>, Europe, Japan, China, Hong Kong) and, in the future, TDSF, its
Affiliates and/or third parties may continue to do so outside of the Territory. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2
<U>Rights of Negotiation Regarding Central America, South America and China</U>.
During the Term, upon Licensee&#146;s written request to TDSF, TDSF shall
negotiate with Licensee in good faith, but <I>not</I> on an exclusive basis, for
a period of up to twenty (20) Business Days following Licensee&#146;s written
request, regarding the terms and conditions upon which, and the separate
consideration for which, TDSF would engage Licensee to be the operator of
<I>"Disney Stores"</I> comparable to the Facilities operated hereunder within
Central America (including Mexico), South America and/or China (including Hong
Kong but excluding the Hong Kong airport). Any such written request by Licensee
shall include a reasonably detailed preliminary business plan with respect to
such operations proposed to be conducted by Licensee in such region(s). Each of
TDSF and Licensee shall be entitled to decide whether to enter into any such
agreement or arrangement in its sole discretion and may terminate such
discussions at the end of such twenty (20) Business Day period (or earlier if,
during such twenty (20) Business Day period, TDSF and/or its Affiliates enter
into an agreement with another Person to be the operator of such <I>"Disney
Store" </I>facilities in such region(s)), in each case without recourse or
remedy by the other party and without any abatement or reduction of any payments
or other obligations hereunder. Notwithstanding anything to the contrary
contained herein, (i) for purposes of clarification, Licensee acknowledges and
agrees that, prior to the Effective Date, TDSF and/or its Affiliates have
previously commenced negotiations, and intend to continue such negotiations,
with one (1) or more third Persons regarding the proposed operation of
<I>"Disney Store"</I> facilities in such regions (all such
negotiations in process as of the Effective Date, the <B>"Current
Negotiations"</B>) and, accordingly, prior to the exercise by Licensee of
any of its rights pursuant to this Section 3.2, TDSF and/or its Affiliates may
enter into or may have entered into an agreement with another Person, which may
consist of a Person who competes directly or indirectly with Licensee or its
Affiliates, to be the operator of such <I>"Disney Store"</I>
facilities in such region(s) or may elect to operate such <I>"Disney
Store"</I> facilities itself, in which event TDSF would be entitled either
not to commence negotiations with Licensee hereunder or to terminate any such
negotiations that had commenced with respect to such region(s), in each case
without recourse or remedy by Licensee and without any abatement or reduction of
any payments or other obligations of Licensee hereunder, (ii) in the event that,
during the Term, all of the Current Negotiations regarding the proposed
operation of <I>"Disney Store"</I> facilities in Central America
(including Mexico) or South America terminate, TDSF shall provide written notice
to Licensee of such termination and, upon Licensee&#146;s written request made
within five (5) Business Days following TDSF&#146;s written notice, TDSF shall
negotiate with Licensee in good faith and exclusively for a period of twenty
(20) Business Days following Licensee&#146;s written request (such period not to
be shortened based upon the circumstances described in the preceding
subparagraph (i) of this Section 3.2.), regarding the terms and conditions upon
which, and the separate consideration for which, TDSF would engage Licensee to
be the operator of such <I>"Disney Store"</I> facilities in Central
America (including Mexico) or South America, as applicable, and (iii) in the
event that, during the Term, all of the Current Negotiations regarding the
proposed operation of "Disney Store" facilities in China (including
Hong Kong) terminate, TDSF shall provide written notice to Licensee of such
termination and, upon Licensee&#146;s written request made within five (5)
Business Days following TDSF&#146;s written notice, TDSF shall negotiate with
Licensee in good faith, but not on an exclusive basis, for a period of twenty
(20) Business Days following Licensee&#146;s written request (such period not to
be shortened based upon the circumstances described in the preceding
subparagraph (i) of this Section 3.2.), regarding the terms and conditions upon
which, and the separate consideration for which, TDSF would engage Licensee to
be the operator of such <I>"Disney Store"</I> facilities in China
(including Hong Kong but excluding the Hong Kong airport), <U>provided</U>,
that, in the case of the preceding subparagraphs (ii) and (iii), (a) each of
TDSF and Licensee shall be entitled to decide whether to enter into any such
agreement or arrangement in its sole discretion and may terminate such
discussions at the end of such twenty (20) Business Day period, in each case
without recourse or remedy by the other party and without any abatement or
reduction of any payments or other obligations hereunder, and (b) in the event
that Licensee fails to respond to TDSF within five (5) Business Days following
TDSF&#146;s written notice or the parties fail to enter into a definitive
written agreement within such twenty (20) Business Day period, then TDSF and/or
any of its Affiliates shall be entitled to operate, and/or negotiate and enter
into any agreement with any other Person, including any Person who competes
directly or indirectly with Licensee or its Affiliates, to be the operator of,
such <I>"Disney Store"</I> facilities in any such region(s), without
recourse or remedy by Licensee and without any abatement or reduction of any
payments or other obligations of Licensee hereunder. Any agreement between TDSF
and Licensee reached under this Section 3.2 shall be memorialized in a separate
written agreement. </FONT></P>

<P><FONT SIZE=3>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>LICENSE</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.1 <U>Grant of License</U>. Subject to the terms and conditions of this
Agreement (including, without limitation, the approval provisions set forth in
Section&#160;5), TDSF grants to Licensee, and Licensee hereby accepts from TDSF,
during the Term and within the Territory, the non-exclusive, non-sublicenseable
(except to the extent of any sublicense granted pursuant to a
Manufacturer&#146;s Agreement or Manufacturer&#146;s MOU), limited right to use,
reproduce and display the Disney Properties only on or in connection with: (i)
tenant improvements and furniture, fixtures and equipment that are embodied or
used in the Facilities in connection with the Business, including, without
limitation, shelving, appliances, lighting, packages, shopping bags, gift wrap,
staff costumes and other physical attributes of the Facilities (collectively,
the <B>"FF&amp;E Materials"</B>); (ii) Disney Merchandise, including packaging
and containers for such Disney Merchandise, that are developed, manufactured,
distributed, offered for sale and sold solely within the Facilities and the
Internet Store authorized hereunder and operated in accordance with the terms
hereof (or as otherwise permitted by Section 6.3(i)(b) and 6.3(i)(c)); and (iii)
marketing, advertising and promotional materials, displays and other collateral
materials that pertain to the Business, including, without limitation, all
designs, layouts and graphics for advertising, promotional and other displays
(including signage) in the Facilities, all direct marketing materials used in
connection with email, telephone and/or mail solicitations, all designs,
layouts, graphics and other displays for each webpage of the Internet Store, and
employee application forms and training materials for the Business
(collectively, the <B>"Marketing Materials"</B>) (the materials described in the
foregoing subparagraphs (i), (ii) and (iii) of this Section 4.1 are referred to
herein collectively as the <B>"Licensed Materials"</B>); <U>provided</U>, that
the Licensed Materials shall be used by Licensee only in the exact form, style,
type and manner prescribed or approved by TDSF from time to time hereunder in
connection with the Business. All concepts, drawings, prototypes, models,
artwork, pre-production samples, production samples, blueprints, webpages and
other designs for the FF&amp;E Materials, the Disney Merchandise and the
Marketing Materials that pertain to the Business, whether created by or for
Licensee, must be submitted to TDSF for prior written approval in accordance
with Section 5. Licensee agrees to actively exercise the rights granted to it
under this Section 4.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.2 <U>Exclusions;
Reservation of Rights</U>. Except as otherwise expressly permitted by any
separate written agreement between Licensee and TDSF, Licensee agrees not to use
any Licensed Materials in any form or to exercise any rights granted herein in
any manner other than as expressly specified in this Agreement. Notwithstanding
any other provision of this Agreement to the contrary, except as specifically
set forth in Section 4.1, no other properties (including any proprietary
designations or intellectual property) of TDSF or any of its Affiliates are
included in the Licensed Materials. Any rights with respect to the Disney
Properties or any other names, brands, trademarks, logos, symbols, characters or
other proprietary designations or intellectual property of TDSF or any of its
Affiliates that are not expressly granted to Licensee under Section 4.1 are
reserved in their entirety to TDSF and its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.3      <U>Limitations</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.3.1 The rights granted to
Licensee hereunder are solely for the purpose of operating the Business through
the Facilities and the Internet Store and do not extend to any use of Disney
Properties for any other purpose, including, without limitation, catalog or
direct mail sales (other than, in the case of direct mail, promotional
activities in accordance with this Agreement), telephone sales (other than
incidental telephone sales conducted in connection with the customer service
operations of the Internet Store), sales through Mass Merchandisers or
Department Stores, or any other sales of any sort (at retail, wholesale or
otherwise) not originating in and transacted at a Facility or the Internet Store
(other than sales to TDSF, any of its Affiliates, Other Disney Stores Operators
or Liquidators as permitted by Section&#160;6.3(i)(b) and 6.3(i)(c)). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.3.2 The rights granted to
Licensee hereunder shall not extend to two-dimensional fine art (including,
without limitation, cels, sericels, serigraphs, lithographs and other fine art
prints and posters), three-dimensional fine art or high-end collectibles
(<U>i.e.</U>, collectibles that are priced materially higher than comparable
non-collectible products of the same type) (including, without limitation,
high-end figurines, sculptures and maquettes) bearing, featuring or
incorporating Disney Properties; <U>provided</U>, that the foregoing shall not
prohibit Licensee from selling any three dimensional character props that are
located in or affixed to any Facilities that are being closed or refurbished,
subject to TDSF&#146;s approval in its sole discretion of the manner by which
such items are sold. In addition, the rights granted to Licensee hereunder shall
not extend to the creation, development, manufacture, sourcing or production of
content-based merchandise or services, such as, by way of example and without
limitation, motion pictures, television programming, home entertainment
products, theatrical productions or books, magazines or other publications;
<U>provided</U>, that TDSF will consider in good faith any Licensee proposals to
create newsletters in connection with loyalty clubs for guests of the
Facilities, but Licensee&#146;s right to produce any such newsletters shall be
subject to the final approval of TDSF in its sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.3.3 Licensee shall not
engage in any marketing, advertising or promotional campaign that consists of or
includes a sweepstakes, lottery or other game of chance without in each instance
obtaining the prior written consent of TDSF pursuant to Section&#160;5, which
TDSF may grant or withhold in its sole discretion. Licensee acknowledges and
agrees that it is the expectation of the parties hereto that such campaigns
shall be used on a limited basis only, that TDSF shall be under no obligation
whatsoever to approve any such campaign, that Licensee shall be solely
responsible for ensuring that any such campaign complies with the rules of such
campaign and all applicable Laws in each jurisdiction in which it is conducted,
including with respect to any bonding or other comparable insurance
requirements, and that Licensee shall indemnify and hold harmless TDSF and its
Affiliates for any failure of any such campaign to so comply with such rules of
such campaign and applicable Laws. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.3.4 Licensee shall have
the right to use Disney Merchandise as Premiums as part of marketing,
advertising and promotional activities hereunder, subject in each instance to
the written approval of TDSF in its sole discretion, <U>provided</U>, that
Licensee acknowledges and agrees that it is the expectation of the parties
hereto that Premiums shall be used as a part of such marketing, advertising and
promotional activities on a limited basis only and that TDSF shall be under no
obligation whatsoever to approve any Disney Merchandise for use as Premiums but
rather shall do so only in its sole discretion. Any Premiums approved by TDSF in
accordance with this Section&#160;4.3.4 shall be subject to all of the
provisions of this Agreement pertaining thereto (including, without limitation,
the approval provisions set forth in Section&#160;5). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.3.5 Licensee acknowledges
and agrees that (i) the primary benefit it seeks to obtain through the license
granted under this Agreement is the ability to use, feature reproduce and
display the Disney-Branded Properties on or in connection with the Licensed
Materials, as opposed to the Non-Disney-Branded Properties, (ii) TDSF shall be
under no obligation whatsoever to designate any Non-Disney-Branded Properties
for use, reproduction or display under this Agreement but rather shall do so
only in its sole discretion (<U>provided</U>, that in making any such
determination, TDSF will not treat Licensee less favorably in any material
respect than any Other Disney Store Operator has been treated by TDSF or its
Affiliates with respect to the applicable Non-Disney-Branded Property), and
(iii) it is the expectation of both Licensee and TDSF that Non-Disney-Branded
Properties (notwithstanding those contained in <U>Schedule 1(e)</U>, which in
any case remain subject to the terms of Section 4.9) shall be designated for use
hereunder only occasionally or sporadically and that, in light of that
expectation, Licensee shall not be harmed or disadvantaged if TDSF does not
designate any Non-Disney-Branded Properties for use, reproduction or display
hereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.3.6 Notwithstanding
anything to the contrary contained herein, Licensee acknowledges and agrees that
its rights pertaining to the operation of the Internet Store, including, without
limitation, its right to use the TDS Internet Domains, its right to use the
Disney Properties in the creation or development of webpages or other design
elements for the Internet Store, its right to offer for sale, sell and/or
distribute Disney Merchandise at or through the Internet Store, and any and all
other rights pertaining in any manner whatsoever to the Internet Store, shall
not become effective until the Internet Start Date but shall thereafter continue
throughout the remainder of the Term. Licensee further acknowledges and agrees
that, other than the Internet Store, it shall not, and shall not be authorized
or entitled under this Agreement to, operate any direct-to-consumer retail
business, including, without limitation, any mail or telephone order retail
business, any catalog business, or any Internet, online, electronic or
"virtual" business other than the Internet Store, whether before or
after the Internet Start Date (<U>provided</U> that the foregoing shall not be
deemed to prohibit marketing or advertising activities promoting the Facilities
and the Internet Store in accordance with this Agreement). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.4      <U>Ownership of Licensed Materials and Trademarks</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.4.1 <U>Ownership</U>.
Licensee acknowledges that the copyrights and all other proprietary rights in
and to the Licensed Materials are exclusively owned by and reserved to TDSF and
its Affiliates (or its licensors, if applicable to any Licensed Materials).
Licensee shall neither acquire nor assert copyright ownership or any other
rights in the Licensed Materials or in any derivation, adaptation, variation or
name thereof or Trademark related thereto. The rights and powers hereby granted
to Licensee in this Section 4 are those of a licensee only. Licensee
acknowledges and agrees that under no circumstances shall any power granted to
Licensee, or that may be deemed to be granted to Licensee, be deemed to be
coupled with an interest. Without limiting the foregoing, Licensee hereby
assigns to TDSF all of Licensee&#146;s worldwide right, title and interest in
and to the Licensed Materials, including, without limitation, the copyrights and
all renewals and extensions thereof, and other adaptations, compilations,
collective works, derivative works, variations or names of Licensed Materials,
heretofore or hereafter created by or for Licensee. All such new materials are
included in the definition of Licensed Materials under this Agreement. If
Licensee engages, retains or otherwise involves any third party to make any
contribution to the creation of any new materials included in the definition of
Licensed Materials, Licensee shall obtain from such third party a full
assignment of rights so that the foregoing assignment by Licensee shall vest
full rights to such new materials in TDSF. In addition, all uses of any
Trademarks of TDSF or its Affiliates by Licensee shall inure to TDSF&#146;s
benefit. Licensee acknowledges that, as between Licensee and TDSF, TDSF is the
exclusive owner of all Trademarks of TDSF or its Affiliates, and the trademark
rights created by such uses. Without limiting the foregoing, Licensee hereby
assigns to TDSF all trademark rights created by its use of any Trademarks of
TDSF or its Affiliates, together with the goodwill attaching to that part of
Licensee&#146;s business in connection with which such Trademarks are used. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.4.2 <U>Registration</U>.
Registration of copyrights, trademarks, service marks, trade names, internet
domain names and URLs, industrial designs and business designations, and
securing utility models and patents of inventions, belonging to TDSF or any of
its Affiliates shall be the responsibility of TDSF, which may, at its option in
its sole discretion and at its own expense, file all appropriate applications
deemed necessary by TDSF to protect its rights, and through this Agreement those
rights licensed to Licensee, in all such copyrights, trademarks, service marks,
trade names, internet domain names and URLs, industrial designs, business
designations, utility models and patents. Licensee shall not register or attempt
to register copyrights in, or to register as a trademark, service mark, trade
name, internet domain name or URL, industrial design, business designation,
utility model or patent, any of the Licensed Materials, or derivations or
adaptations thereof, or any word, symbol or design that is so similar thereto as
to suggest association with or sponsorship by TDSF or its Affiliates. In no
event shall Licensee oppose or seek to cancel or challenge, in any forum,
including but not limited to the U.S. Patent and Trademark Office, any
application or registration of any copyright, trademark, service mark, trade
name, internet domain name or URL, industrial design, business designation,
utility model, patent or other proprietary designation or intellectual property
of TDSF or its Affiliates. At any time, upon TDSF&#146;s request, Licensee
agrees to execute and deliver to TDSF such assignments and/or other documents as
TDSF may require to confirm the ownership of the Licensed Materials by TDSF or
its Affiliates, and Licensee hereby designates TDSF as Licensee&#146;s true and
lawful attorney-in-fact and agent, for Licensee and in Licensee&#146;s name,
place and stead, in any and all capacities, solely for the purpose of executing
any such assignments and/or other documents necessary for TDSF to confirm and/or
perfect the ownership of the Licensed Materials by TDSF or its Affiliates that
Licensee fails to execute and deliver to TDSF within five (5) Business Days
following TDSF&#146;s request. Without limiting this Section 4.4, the parties
hereto acknowledge and agree that the ownership and license rights of the
parties with respect to Non-Disney Technology and Elements and Product
Trademarks are set forth in and governed by the provisions of Section&#160;11. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.5 <U>Copyrights</U>. As a
condition to Licensee&#146;s right hereunder to use, reproduce and display the
Licensed Materials, each use, reproduction or display thereof shall bear a
proper copyright notice permanently affixed in the name of TDSF or its
Affiliates as follows: "&#169; Disney", or such other notice as TDSF
may specify to Licensee in writing from time to time. Licensee acknowledges and
agrees that all Disney Merchandise shall, in TDSF&#146;s judgment in its sole
discretion, be legally authorized and entitled to be labeled with and bear the
"Disney" name, and any products or merchandise that do not meet such
requirement shall not be created, produced, manufactured, offered or sold
hereunder as Disney Merchandise (<U>provided</U>, that products or merchandise
that bear, feature or incorporate only Non-Disney-Branded Properties shall
nonetheless qualify as Disney Merchandise hereunder if they are labeled with and
bear such name(s) as TDSF shall designate in its sole discretion). Licensee will
comply with all instructions as to the form, location and content of such
copyright or other notices as TDSF may specify to Licensee from time to time.
Licensee will not, without TDSF&#146;s prior written consent, affix to any
Licensed Materials a copyright notice in any other name. If through inadvertence
or otherwise a copyright notice in Licensee&#146;s name or the name of a third
party should appear on any Licensed Materials, Licensee hereby (i) agrees to
assign to TDSF the copyright represented by any such copyright notice in the
name of Licensee or such third party and cause the execution and delivery to
TDSF of all documents necessary to convey to TDSF the copyright represented by
such copyright notice and (ii) designates TDSF as Licensee&#146;s true and
lawful attorney-in-fact and agent, for Licensee and in Licensee&#146;s name,
place and stead, in any and all capacities, to execute any such documents that
Licensee fails to execute and deliver to TDSF within five (5) Business Days
following any request by TDSF to Licensee to execute and deliver such documents.
If by inadvertence a proper copyright notice is omitted from any Licensed
Materials and if TDSF so requests, Licensee agrees, at Licensee&#146;s sole
expense, to use its commercially reasonable efforts to correct the omission on
all such Licensed Materials not previously sold by Licensee. Licensee agrees to
advise TDSF promptly and in writing of the steps being taken to correct any such
omission and to make the corrections on existing Licensed Materials not
previously sold by Licensee. Without limiting the foregoing, with respect to
Licensed Materials consisting of Winnie The Pooh, Licensee agrees to include on
such Licensed Materials the following language: "Based on the "Winnie
The Pooh" works, by A. A. Milne and E. H. Shepard." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.6 <U>No Rights in
Music</U>. No music or musical compositions, or any name, voice or likeness of
any individual performer associated with the Licensed Materials, is licensed
under this Agreement. Any charges, fees or royalties payable for music rights,
name, voice or likeness rights, or any other rights not covered by this
Agreement, shall be in addition to the Licensee Payments (notwithstanding that
all or a portion of such charges, fees or royalties may be payable to TDSF or
any of its Affiliates for their own benefit and shall not be deducted from other
payments due hereunder to TDSF), and Licensee must negotiate, obtain and pay for
any such rights through separate agreements, including, without limitation, for
any in-store audio/video uses of Licensed Materials and all uses of Licensed
Materials in Disney Merchandise. Upon request by Licensee, TDSF shall, or shall
cause Disney Music Publishing or such other Affiliates of TDSF as TDSF shall
designate in its sole discretion to, provide or arrange for the provision of
reasonable assistance to Licensee in connection with obtaining any such rights
(provided that, if any such rights are owned or controlled by third parties
rather than TDSF or its Affiliates, the obligation of TDSF and its Affiliates
hereunder shall be limited to providing such information (if any) with respect
to such rights as is known and readily available to TDSF and its Affiliates
without investigation or diligence). In the event that TDSF, Disney Music
Publishing and/or such other Affiliates of TDSF so provide or arrange for such
assistance, Licensee shall reimburse TDSF and/or its Affiliates for their costs
and expenses incurred in connection therewith in accordance with the Allocated
Cost Methodology. TDSF, Disney Music Publishing and/or such other Affiliates of
TDSF shall invoice Licensee monthly in arrears for the assistance provided
pursuant to this Section 4.6, and Licensee shall pay TDSF and/or its Affiliates
for amounts due on each such invoice no later than twenty (20) Business Days
following delivery of such invoice by TDSF, Disney Music Publishing and/or such
other Affiliates of TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.7 <U>Film Clips</U>. In
order for Licensee to use any Licensed Materials containing film clips, Licensee
must negotiate, obtain and pay for any such rights through separate agreements.
Payment for such rights may include licensing and/or royalty fees and/or union
re-use payments relating to the use or reproduction of compositions, recordings,
artists, voices or other elements or components thereof in connection with
Licensee&#146;s use of the Licensed Materials, a portion of which payments may
be due to TDSF or any of its Affiliates for their own benefit and shall not be
deducted from other payments due hereunder to TDSF. Any such film clip footage
may not be modified or reproduced (except within the approved Licensed
Materials). Promptly after the final permitted use of any film clip footage,
such footage shall either be returned to TDSF or destroyed by Licensee,
<U>provided</U>, that Licensee must provide TDSF with a written certification
from its Chief Financial Officer or a senior executive officer with knowledge of
or responsibility for the matters being certified stating that such film clip
footage was destroyed. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.8      <U>Infringement; Legal Actions</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.8.1 <U>Notice</U>.
Promptly (and in any case within three (3) Business Days) after Licensee or its
Affiliates become aware of any Disney IP Claim relating to the Business,
Licensee shall provide written notice thereof to TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.8.2 <U>Control of Disney
IP Claims Involving Licensee; Costs</U>. In the event that Licensee or any of
its Affiliates is subject to or becomes a party to any Disney IP Claim, whether
as plaintiff or defendant, complainant or accused, or in any other capacity,
TDSF shall have exclusive control over, and shall have sole discretion to take
any such action as it deems appropriate with respect to, such Disney IP Claim.
As used herein, "control" of a Disney IP Claim means the right to
select counsel, to oversee and direct the actions of counsel, to approve all
filings, motions and other procedures occurring in connection therewith, to
approve any settlement of, or decision not to settle, such Disney IP Claim, to
direct any litigation arising from such Disney IP Claim, and to approve all
other matters relating thereto. Licensee and its Affiliates (i) shall not
institute any Disney IP Claim without TDSF&#146;s prior written consent (to be
granted or denied by TDSF in its sole discretion), and (ii) upon TDSF&#146;s
request, shall agree to be named by TDSF as a sole complainant or co-complainant
in any Disney IP Claim that TDSF or its Affiliates desire to initiate. With
respect to any Disney IP Claim (a) that TDSF has elected to initiate and in
which Licensee is a complainant or co-complainant (other than a cross-complaint
made in response to a Disney IP Claim made against Licensee, unless otherwise
covered by the following subparagraph (b)) or (b) with respect to which TDSF is
required to indemnify Licensee pursuant to Section 12.2, TDSF shall bear the
costs of such Disney IP Claim (in the case of the preceding subparagraph (b), as
and to the extent required in accordance with the provisions of Sections 12.2
and 12.3). With respect to any other Disney IP Claim to which Licensee or any of
its Affiliates is a party, Licensee shall solely bear the costs of such Disney
IP Claim, notwithstanding the fact that it is controlled exclusively by TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.8.3 <U>Cooperation</U>.
In all Disney IP Claims, Licensee shall, and shall cause its Affiliates to,
cooperate and render such assistance and do such acts and things as, in the
opinion of TDSF or its counsel in their business judgment, are reasonably
necessary to protect and maintain TDSF&#146;s, its Affiliates&#146; or
Licensee&#146;s interests in any Disney IP Claim or otherwise to protect and
maintain the Licensed Materials, the Disney Properties or any other name, brand,
trademark, logo, symbol, character or other proprietary designation or
intellectual property of TDSF or its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.8.4 <U>No Right to
Proceeds</U>. Licensee acknowledges and agrees that Licensee and its Affiliates
are not entitled to share in any damages, proceeds or other monetary relief
recovered pursuant to a Disney IP Claim (by settlement, judgment or otherwise),
unless and only to the extent that such damages, proceeds or other monetary
relief, or any part thereof, actually represent injuries directly sustained by
Licensee as a result of its inability to sell Disney Merchandise that was owned
or ordered by Licensee as of the commencement of the respective Disney IP Claim,
and only to such extent and specifically excluding any damages or awards that
relate to the Disney Properties in a general manner. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.9 <U>Withdrawal of
Licensed Materials</U>. TDSF may, at any time and from time to time during the
Term, determine, in its sole discretion (a <B>"Withdrawal
Determination"</B>), to withdraw or retire or not authorize or permit,
either temporarily or permanently, and/or amend, modify or revoke any prior
approval granted under Section 5 with respect to, the use, reproduction or
display of any particular Disney Property (<U>e.g.</U>, a particular proprietary
designation or animated character), or the use, reproduction or display of any
particular Disney Property with any particular Disney Merchandise, FF&amp;E
Materials, Marketing Materials or other product or service, or the use,
reproduction or display of any particular Disney Property in a given manner, in
each case for any reason, which may include, without limitation, (i) the extent
to which a particular Disney Property supports TDSF&#146;s or its
Affiliates&#146; entertainment message, (ii) overexposure or underexposure of a
particular Disney Property, (iii) other corporate brand considerations,
including, without limitation, protection of the "Disney" brand, name,
reputation and quality and, in the case of Non-Disney-Branded Properties, any
determination by TDSF in its sole discretion that any such Non-Disney-Branded
Property is no longer appropriate to offer, sell or distribute through the
Facilities and/or the Internet Store or is otherwise inconsistent with or
inappropriate for the image, reputation and brand of a specialty retail store
operated under the <I>"Disney Store"</I> name, (iv) any alleged or
actual copyright and/or trademark infringement or other Disney IP Claim, (v) any
other legal consideration or rights dispute regarding any intellectual property,
or (vi) termination of TDSF&#146;s and its Affiliates&#146; license for, or the
sale of, or any other loss of use by TDSF and its Affiliates of, a particular
Disney Property; <U>provided</U>, that, (a) with respect to Disney-Branded
Properties only, unless the basis for any Withdrawal Determination is one of the
reasons set forth in the preceding subparagraphs (iv), (v) or (vi), TDSF shall
not withdraw or retire any particular Disney-Branded Property for use hereunder
in connection with any particular category or type of merchandise unless TDSF
and its Affiliates shall also have, on a substantially concurrent basis,
withdrawn or retired such Disney-Branded Property for use in connection with
such category or type of merchandise within the Territory by TDSF, its
Affiliates and their respective licensees of such Disney-Branded Property, and
(b) solely with respect to the Non-Disney-Branded Properties set forth on
<U>Schedule 1(e)</U>, unless the basis for any Withdrawal Determination is one
of the reasons set forth in the preceding subparagraphs (iv), (v) or (vi), TDSF
shall not withdraw or retire any particular Non-Disney-Branded Property set
forth on <U>Schedule 1(e)</U> for use hereunder in connection with any
particular category or type of merchandise unless TDSF and its Affiliates shall
also have, on a substantially concurrent basis, withdrawn or retired such
Non-Disney-Branded Property for use in connection with such category or type of
merchandise by all Other Disney Store Operators. In the event that TDSF makes a
Withdrawal Determination with respect to any particular Disney Property, then
TDSF may, in its sole discretion, instruct Licensee in writing to cease all
manufacturing of Licensed Materials bearing, featuring or incorporating such
Disney Property and to withdraw immediately any other Licensed Materials
bearing, featuring or incorporating such Disney Property from the market
(<U>e.g.</U>, remove all such Licensed Materials from all Facilities and the
Internet Store (including all Disney Merchandise or FF&amp;E Materials
containing such Disney Property included therein) and remove from the market all
Marketing Materials (including webpages of the Internet Store) containing such
Disney Property), in each case by a date determined by TDSF in its sole
discretion and specified in such written instructions from TDSF (the
<B>"Withdrawal Date"</B>). In accordance with TDSF&#146;s
instructions, Licensee shall cease such manufacturing of and withdraw all such
Licensed Materials from the market by the Withdrawal Date, subject to the
following **: </FONT></P>


<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.9.1 **; </FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.9.2 **; and </FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.9.3 **. </FONT></P>


<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10 <U>Limitations on
Licensee&#146;s Uses</U>. Except as expressly permitted by this Agreement,
Licensee shall not have the right to, and nothing in this Agreement shall be
construed to give Licensee the right to, and Licensee shall not: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.1 use any names,
marks, symbols, copyrights, logos, characters of any kind, designs,
representations, figures, drawings, ideas or other proprietary designations or
properties owned, developed, created by or licensed to TDSF or any of its
Affiliates (<U>e.g.</U>, "ABC," "ESPN," "Muppets"
and "Miramax"); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.2   use any of the Licensed Materials as Licensee's or its Affiliates' own property;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.3 use any of the
Licensed Materials to express or imply any endorsement of goods, products,
merchandise, services or other items manufactured, supplied, offered or sold by
Licensee or its Affiliates; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.4   use the names "Disney," "Walter E. Disney" or any variation thereof;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.5 sell, lend or
otherwise distribute, with or without payment, any literature, merchandise,
souvenirs or other items that use the Licensed Materials; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.6 use, reproduce,
distribute, display or exploit the Licensed Materials following the date of
expiration or earlier termination of this Agreement, except as otherwise
specifically permitted under Section&#160;16; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.7 use any of the
Licensed Materials in connection with, in any manner or form, the names, marks,
signs, symbols, characters, products, services, logos or other proprietary
designations or intellectual property of any third parties without TDSF&#146;s
prior written consent, which may be granted or denied in TDSF&#146;s sole
discretion; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.8 sublicense or
attempt to sublicense any rights in the Licensed Materials, the Disney
Properties or any other names, brands, trademarks, logos, symbols, characters or
other proprietary designations or intellectual property of TDSF or its
Affiliates without TDSF&#146;s prior written consent, which may be granted or
denied in TDSF&#146;s sole discretion; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.10.9 use any of the
Licensed Materials or any other intellectual property of TDSF or any of its
Affiliates in, upon or in conjunction with any goods or services of Licensee or
its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.11 <U>Disney Character
Appearances</U>. Subject to the provisions of this Section 4.11, each Contract
Year during the Term, upon at least twenty (20) Business Days&#146; advance
written request by Licensee, TDSF shall from time to time provide personal
appearances of one (1) or more Disney Animated Characters at: (i) on a one-time
basis, each Store Facility that was newly opened or as to which a Refurbishment
was completed in accordance with Section&#160;9.3 during such Contract Year and
(ii) such additional designated Store Facilities as may be approved by TDSF in
its sole discretion (such appearances collectively, the <B>"Character
Appearances"</B>). In connection with each Licensee request, Licensee shall
propose the time, date, Store Facility, requested character(s) and a description
of how the requested Character Appearance promotes the brand and entertainment
message of both TDSF and its Affiliates and Licensee. Each Character Appearance
and all aspects and components thereof, including, without limitation, whether a
particular Character Appearance is approved, how many Character Appearances may
be approved in any particular time period (subject to subparagraphs (i) and (ii)
of this Section 4.11) and how many Disney Animated Characters may appear at any
particular Character Appearance, shall be subject to TDSF&#146;s prior written
approval, which approval may be granted or denied in TDSF&#146;s sole
discretion. Licensee acknowledges and agrees that, except for situations
involving special circumstances (which shall be adequately demonstrated to TDSF
by Licensee), TDSF shall not provide more than four (4) Disney Animated
Characters at a single Character Appearance. In determining whether to grant or
deny approval for a requested Character Appearance, TDSF may (but shall not be
required to) take into account the following factors (which are meant to be
illustrative and not definitive nor limiting in any fashion): (a)&#160;the
safety of TDSF personnel and guests, (b)&#160;character availability and prior
commitments, (c)&#160;conflicting activities of TDSF and/or its Affiliates and
(d)&#160;marketing determinations concerning overexposure and underexposure of
one (1) or more of the Disney Animated Characters. Licensee acknowledges and
agrees that a crucial element of any Character Appearance is the placement of
the Disney Animated Characters in a relevant, themed environment; therefore,
Licensee agrees to follow TDSF&#146;s direction concerning all aspects of any
approved Character Appearance to ensure that such appearance satisfies the
mutual common goal of presenting a quality, positive experience to the audience.
Licensee shall comply with all guidelines, rules and regulations respecting the
use of Disney Animated Characters and Character Appearances as TDSF may adopt
from time to time during the Term, including, without limitation, TDSF&#146;s
then-current character use guidelines. All approved Character Appearances shall
be made by personnel of TDSF or its Affiliates. Licensee shall bear all costs
and expenses and shall reimburse TDSF in full for those costs associated with
any Character Appearance, including, without limitation, labor, including per
diem costs, transportation, accommodations, and creative development and
implementation costs associated with any such appearance. For purposes of this
Section 4.11, the term <B>"Disney Animated Characters"</B> shall mean
employees of TDSF or its Affiliates in costumes representing those animated
characters solely owned and controlled by TDSF and/or its Affiliates, excluding
(unless otherwise permitted by TDSF, on a case by case basis) the Winnie the
Pooh characters (<U>i.e.</U>, Winnie the Pooh, Christopher Robin, Piglet,
Rabbit, Eeyore, Tigger, Owl, Gopher, Kanga, Roo and Heffalump), that TDSF in its
sole discretion may designate from time to time during the Term for use in
connection with one (1) or more appearances of such characters in public only. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.12 <U>Certain Obligations
to Third Parties</U>. In connection with Licensee&#146;s use of Disney
Properties under this Agreement, Licensee shall, as and to the extent required
by TDSF in order to ensure compliance with TDSF&#146;s or its Affiliates&#146;
obligations owed to third parties with respect to any Disney Property, (a)
provide any third party designated by TDSF with samples of merchandise bearing,
featuring or incorporating the respective Disney Property and/or (b) comply with
any trademark, service mark and/or copyright notice requirements or other
intellectual property placement requirements of any third party associated with
the respective use of the Disney Property. In addition, notwithstanding anything
to the contrary contained herein, including, without limitation, Section 17,
TDSF and/or its Affiliates shall be entitled to provide third parties with sales
data, forecasts, projections and other financial information received by TDSF
from Licensee hereunder, including, without limitation, the sales data
contemplated by Section 9.11.1, to the extent necessary to ensure compliance
with TDSF&#146;s or its Affiliates&#146; obligations owed to third parties with
respect to any Disney Property or to the extent necessary, as determined by TDSF
in its sole discretion, to facilitate TDSF&#146;s or its Affiliates&#146;
relationships with such third parties <U>(provided</U> that under no
circumstances shall Licensee be entitled to any inspection, audit or comparable
rights with respect to such third party Contracts, whether any demand or request
is made pursuant to the terms of this Agreement or in connection with any
dispute or controversy that may arise hereunder or any attempted discovery
thereof in connection with such dispute or controversy, whether by way of
document production, interrogatories, depositions or other discovery method). In
the event that TDSF provides third parties with information received from
Licensee pursuant to the preceding sentence, TDSF shall, subject to the terms of
any confidentiality restrictions with such third party, endeavor to provide
Licensee with notice of the information so furnished and the identity of the
third party to whom such information was furnished. Any failure by TDSF to
provide Licensee with such notice and/or identify the third party to whom such
information was furnished shall not be deemed a breach by TDSF of this
Agreement. </FONT></P>

<P><FONT SIZE=3>5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>TDSF'S APPROVAL PROCEDURES</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.1 <U>Disney Merchandise Approvals</U>. Licensee shall not create, develop,
manufacture, produce or offer for sale, through the Facilities, the Internet
Store or otherwise, any article of Disney Merchandise, including any containers
and packaging for such Disney Merchandise (collectively, each, an
<B>"Article"</B>), regardless of whether such Disney Merchandise bears, features
or incorporates any Disney Properties, without first obtaining TDSF&#146;s
approval in accordance with the provisions set forth in this Section 5.1 in each
instance. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.1.1    <U>Approval of Conceptual Materials and Pre-Production Samples</U>.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) As early as
possible, and in any case before commercial production of any Article, Licensee
shall submit to TDSF for TDSF's review and to obtain TDSF's written approval (to
utilize such materials in preparing a pre-production sample), all concepts,
preliminary and proposed final artwork, and, to the extent relevant,
three-dimensional models and any other comparable pre-production materials
(collectively, the "<B>Conceptual Materials</B>") that are to appear on or in each SKU
of the Article. TDSF shall use commercially reasonable efforts to approve or
disapprove such submission within ten (10) Business Days following such
submission of such Conceptual Materials. If TDSF approves in writing the
Conceptual Materials, then Licensee thereafter shall submit to TDSF for TDSF's
written approval a pre-production sample of each SKU of each Article, together
with the test reports required by Section 5.1.4(b)(ii). TDSF shall use
commercially reasonable efforts to approve or disapprove such submission within
ten (10) Business Days following such submission of such pre-production
sample(s). TDSF may approve or disapprove any such pre-production sample based
on, as determined by TDSF in its sole discretion: (i) lack of conformity of such
pre-production sample to the approved Conceptual Materials, (ii) unacceptable
quality of the Article (including any artwork included therewith) as
manufactured, (iii) the results of the test reports submitted pursuant to
Section 5.1.4(b)(ii), or (iv) such other factors as TDSF may determine on a
case-by-case basis in its sole discretion. All Conceptual Materials and
pre-production samples described in this Section 5.1.1 shall be submitted to the
individual so designated from time to time by TDSF.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In each instance
where TDSF fails to provide Licensee with any communication indicating TDSF's
approval or disapproval of Licensee's submissions of Conceptual Materials or
pre-production samples, as applicable, within the ten (10) Business Day period
described in subparagraph (a) of this Section 5.1.1, Licensee shall be entitled
to provide TDSF with written notice of such failure to communicate any response
and, if Licensee provides such written notice and TDSF fails to communicate its
approval or disapproval of to the applicable submission within two (2) Business
Days following such written notice from Licensee, then such failure shall be
deemed a "<B>Response Failure</B>." Following an initial Response Failure with respect
to any particular submission of Conceptual Materials or pre-production samples,
if another ten (10) Business Days elapses without communication of an approval
or disapproval from TDSF, then Licensee shall be entitled to provide an
additional written notice of such failure to communicate a response and, if
Licensee provides such additional written notice and TDSF fails to communicate
its approval or disapproval of such submission within two (2) Business Days
following such additional written notice, then such failure to communicate a
response shall also be deemed a "<B>Response Failure</B>." Following such second
Response Failure, the foregoing notification process may continue until TDSF
communicates its approval or disapproval of the applicable submission and any
subsequent failure by TDSF to communicate its approval or disapproval of such
submission within two (2) Business Days following written notice from Licensee
in accordance with the foregoing provisions shall also be deemed a "<B>Response
Failure</B>." Within twenty (20) Business Days following the end of each half (1/2)
of each Contract Year, TDSF shall pay to Licensee an amount (if positive and if
any) equal to (i)(A) the number of Response Failures occurring during the
immediately preceding six (6) Retail Months of such Contract Year minus fifteen
percent (15%) of the aggregate number of submissions by Licensee to TDSF of
Conceptual Materials and pre-production samples during such six (6) Retail Month
period of such Contract Year, multiplied by (B) Five Hundred Dollars ($500),
minus (ii) Five Hundred Dollars ($500) (such amount, the "<B>Response Failure Fee</B>")
by wire transfer to an account designated by Licensee in writing.
Notwithstanding anything to the contrary contained herein, other than referral
of repetitive Response Failures to the Joint Advisory Committee pursuant to
Section 8.3.6, the Response Failure Fee shall be Licensee's sole and exclusive
remedy for any and all Response Failures and Licensee shall have no other
recourse or remedy nor be entitled to any abatement or reduction of any payments
or other obligations hereunder on account of any such Response Failures.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In addition to
the foregoing subparagraphs (a) and (b) of this Section 5.1.1, (i) in any case
where Licensee has re-submitted Conceptual Materials and/or pre-production
samples that were previously approved or disapproved by TDSF under this Section
5.1.1 and were subject to only minor revisions or refinements, TDSF shall
respond to such re-submission within five (5) Business Days following Licensee's
submission of such revisions or refinements, (ii) during each
Monday-through-Friday period during the Term, TDSF shall, upon Licensee's
request, use its commercially reasonable efforts to respond to up to five (5)
submissions of Conceptual Materials and/or pre-production samples within two (2)
Business Days rather than ten (10) Business Days, and (iii) if, during any
Retail Month, TDSF fails to respond to at least seventy-five percent (75%) of
all submissions of Conceptual Materials and/or pre-production samples during
such Retail Month within six (6) Business Days or less, such response rate shall
be reviewed by the Joint Advisory Committee pursuant to Section 8.3.6 to
determine strategies for improving TDSF's rate of response to such submissions.
Notwithstanding anything to the contrary contained herein, such review by the
Joint Advisory Committee pursuant to subparagraph (c)(iii) of this Section 5.1.1
shall be Licensee's sole and exclusive remedy for any and all failures by TDSF
to so respond to at least seventy-five percent (75%) of such submissions within
such six (6) Business Day period as described in subparagraph (c)(iii) of this
Section 5.1.1 and Licensee shall have no other recourse or remedy nor be
entitled to any abatement or reduction of any payments or other obligations
hereunder on account of any such failures. Licensee shall not be permitted to
proceed to the next stage of the Disney Merchandise approval process under
Section 5.1.2 until Licensee has obtained TDSF's written approval of the
Conceptual Materials and the pre-production samples with respect to each SKU of
a particular Article pursuant to this Section 5.1.1.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.1.2    <U>Approval of Production Samples</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Before offering
for sale to consumers any Article of Disney Merchandise in the Facilities or the
Internet Store, Licensee agrees to furnish to TDSF, from the first production
run of each supplier of such Article, for TDSF's approval, three (3) production
samples of each SKU of such Article or such smaller number as TDSF may direct in
its sole discretion from time to time. In addition, one (1) production sample of
each SKU of such Article shall be sent directly to TDSF's Copyright and
Trademark Registration Department. Such production samples must conform in all
respects to the approved Conceptual Materials and pre-production samples (other
than immaterial variations that are not related to any Disney Property in any
manner whatsoever). Any production sample of an Article for which TDSF has
approved a pre-production sample pursuant to Section 5.1.1, which production
sample conforms in all respects to such approved pre-production sample (other
than immaterial variations that are not related to any Disney Property in any
manner whatsoever), shall be deemed approved by TDSF, <U>provided</U>, that TDSF shall
be entitled, at any time within ten (10) Business Days following Licensee's
submission of such production sample, to disapprove any such production sample
based on (i) lack of conformity of such production sample to the approved
Conceptual Materials or pre-production sample in any manner (other than
immaterial variations that are not related to any Disney Property in any manner
whatsoever), or (ii) unacceptable quality of the Article (including any artwork
included therewith) as manufactured, in each case as determined by TDSF in its
sole discretion, by providing written notice to Licensee of such disapproval,
which notice shall identify the manner in which such production sample does not
conform to the approved Conceptual Materials or pre-production sample or in
which such production sample has failed to achieve an acceptable level of
quality as compared to the quality of the pre-production sample. Any SKU of any
Article not approved by TDSF in accordance with the foregoing provisions shall,
unless otherwise agreed by TDSF in writing, be destroyed. Such destruction shall
be attested to in a certificate signed by one of Licensee's officers. Licensee
agrees to give TDSF written notice (which notice may be in the form of
"on-order" reports detailing orders placed by Licensee with Manufacturers) of
the first ship date for each production sample when Licensee provides the
production sample to TDSF's Copyright and Trademark Registration Department in
accordance with this Section 5.1.2(a).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Licensee agrees
to make available at no charge up to but no more than four (4) production
samples of any or all SKUs of each Article as TDSF may from time to time request
for the purpose of comparison with earlier production samples, for TDSF's
anti-piracy efforts, or for such other purposes as TDSF may determine in its
sole discretion. This subparagraph (b) shall be in addition to the requirements
of Section 4.12.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No modification
of an approved production sample (other than immaterial modifications not
related to any Disney Property) shall be made without TDSF's further prior
written approval. Each SKU of an Article being sold must conform in all respects
to the production sample approved for sale, except with regard to immaterial
changes that may appear from time to time during the actual production of such
SKU of an Article. It is understood that, except with regard to any immaterial
changes described in the foregoing sentence, if, in TDSF's sole discretion, the
quality of any SKU of an Article originally approved has deteriorated in later
production runs or if the SKU has otherwise been altered, TDSF may, in addition
to other remedies available to TDSF, by written notice require such SKU of an
Article to be immediately withdrawn from the market at Licensee's sole cost and
expense. Accordingly, TDSF recommends that Licensee submit production samples to
TDSF for approval before committing to a large original production run or
committing to purchase a large shipment from a new supplier.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.1.3    <U>General Matters Regarding Disney Merchandise Approvals</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If any
unapproved SKU of any Article is being sold, TDSF may, together with other
remedies available to TDSF, by written notice require such SKU of such Article
to be immediately withdrawn from the market solely at Licensee's sole cost and
expense. Any modification of any SKU of an Article (other than immaterial
modifications not related to any Disney Property), including, without
limitation, change of materials, color, design or size of the Licensed
Materials, must be submitted in advance for TDSF's written approval as if it
were a new SKU of an Article. Approval of any SKU of an Article that uses
particular artwork does not imply approval of such artwork for use with a
different Article. The fact that artwork has been taken from a Disney Property
or a previously approved Article does not mean that its use will necessarily be
approved in connection with an Article licensed hereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If Licensee
knowingly submits for approval artwork from an article of merchandise
manufactured or published by another licensee of TDSF or of any of TDSF's
Affiliates, Licensee must advise TDSF in writing of the source of such artwork.
If Licensee fails to do so, any approval that TDSF may give for use by Licensee
of such artwork may be withdrawn by giving Licensee written notice thereof, and
Licensee may be required by TDSF not to sell any Article using such
artwork.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If TDSF has
supplied Licensee with forms for use in applying for approval of Conceptual
Materials, pre-production samples and production samples of Articles, Licensee
shall use such forms when making submissions for TDSF's approval.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If the
likenesses and product application of the Disney Properties used on or in
connection with the Articles are subject to any third party approvals that TDSF
deems necessary for Licensee to obtain, then TDSF will act as the liaison with
such third parties (or, with TDSF's consent, in its sole discretion, Licensee
may deal directly with such third parties) during the approval process,
<U>provided</U>, that Licensee shall be solely responsible for any costs or fees
incurred in connection with obtaining such approvals.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Except as
permitted under Section 6.3(i)(c) hereof, the rights granted hereunder do not
permit the sale of "seconds" or "irregulars."</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Licensee
acknowledges that TDSF may not approve Conceptual Materials perceived to be for
selling periods beyond the Term.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) At any time
during the Term, TDSF shall have the right, in its sole discretion, by written
notice to Licensee, to require modification of any SKU of any Article that was
previously approved by TDSF in accordance with this Section 5.1, <U>provided</U>, that
such notification shall advise Licensee of the nature of the changes required
and shall be subject to the terms of Section 4.9 (including the reimbursement
provisions set forth in such Section as if such notification were a Withdrawal
Determination).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) In the event
that Licensee demonstrates, to the satisfaction of TDSF in its business
judgment, that a Disney-Branded Property proposed to be featured on or
incorporated in any SKU of any Article submitted by Licensee to TDSF for
approval under this Section 5.1 is, at the time of such submission, featured on
or incorporated in a consumer product of the exact same type as such submitted
Article, which consumer product is available for retail purchase within the
Territory or from an Other Disney Store Operator outside of the Territory and is
being distributed by TWDC, its Affiliates, any of TWDC's third party licensees
or any Other Disney Store Operator, then TDSF shall not withhold its approval of
the use of such Disney-Branded Property on such SKU of such Article proposed by
Licensee, provided, that, (i) if such Disney-Branded Property is, at the time of
such submission, featured on a consumer product that is available for purchase
from and is being distributed by an Other Disney Store Operator outside of the
Territory, TDSF may, in its sole discretion, impose conditions or other
restrictions in connection with such approval of the use of such Disney-Branded
Property on such SKU of such Article by Licensee within the Territory based on
such considerations and factors relating to the Territory as TDSF may deem
relevant in its sole discretion, including, without limitation, release
schedules for entertainment properties within the Territory, overexposure and
underexposure of particular Disney-Branded Properties within the Territory and
other factors relating to the timing of the introduction of such SKU of such
Article within the Territory, and (ii) Licensee shall nonetheless be required to
obtain all other approvals from TDSF required pursuant to this Section 5.1,
including, without limitation, approval of the form, style and manner in which
such Disney-Branded Property is used in connection with such SKU of such
Article. If Licensee believes any submission to TDSF is made in accordance with
this Section 5.1.3(h), Licensee shall so indicate to TDSF in writing at the same
time Licensee submits Conceptual Materials to TDSF in accordance with Section
5.1.1.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) With respect to
any submission of Conceptual Materials, pre-production samples and/or production
samples of apparel Articles that are expected to be manufactured and offered for
sale in more than one (1) size, (a) Licensee shall identify each size of such
Article that is expected to be manufactured and offered for sale, which sizes
shall be within size standards established from time to time by Licensee and
approved by TDSF in its sole discretion ("<B>Conforming Sizes</B>") or, if not within
the Conforming Sizes, shall be separately identified as being outside of the
Conforming Sizes ("<B>Non-Conforming Sizes</B>"), (b) Licensee shall not be required to
provide samples of each size to be manufactured and offered for sale but rather
shall only be required to provide (1) with respect to Conforming Sizes of any
Article of children's apparel, a pre-production sample and production sample in
at least one (1) of such Conforming Sizes, (2) with respect to Conforming Sizes
of any Article of adult apparel, a pre-production sample and production sample
in at least one (1) of such Conforming Sizes, (3) in the event that Licensee
determines in its business judgment that the presentation of any element or
component of the Disney Properties in Conforming Sizes of any Article of
children's apparel or adult apparel varies based on size, at least one (1)
additional sample of such Conforming Sizes to demonstrate such variations, and
(4) with respect to Non-Conforming Sizes of any Article, pre-production samples
and production samples in each of such Non-Conforming Sizes, and (c) TDSF shall
be entitled, in its sole discretion, to approve or disapprove any apparel
Article within specified sizes or ranges of sizes (<U>e.g.</U>, approval of an Article
in children's sizes but not in adult sizes) based on the appropriateness of the
applicable Disney Properties for certain age groups, the appearance of certain
apparel Articles in various sizes, the presentation of Disney Properties in
various sizes, or such other factors as TDSF shall determine in its sole
discretion.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.1.4    <U>Manufacturing/Sourcing</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>International
Labor Standards <B>("ILS")</B>; Compliance</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Licensee agrees
to engage at its expense a TDSF-approved audit firm ("<B>Audit Firm</B>") to evaluate
and monitor the vendors and manufacturers used to design, produce, manufacture,
package or distribute the Articles and components of the Articles (the
"<B>Manufacturers</B>"). The Audit Firm (and, if TDSF elects in its sole discretion to
participate in any audit, TDSF or its Affiliates) shall use TDSF's policies and
protocol in conducting audit activities and measuring compliance with TDSF's
Code of Conduct for Manufacturers (the "<B>Code</B>," which is set forth in Section 6
of the form of Manufacturer's Agreement set forth in <U>Schedule 5.1.4(a-1)</U> (such
Manufacturer's Agreement, as it may be revised from time to time with the
approval of TDSF in its sole discretion, the "<B>Manufacturer's Agreement</B>")). In
connection with the use of Manufacturers, Licensee and TDSF shall in good faith
mutually develop and, at least once per Contract Year within thirty (30) days
following the commencement of each Contract Year, review a compliance program,
an audit schedule, a reporting process and a definition and approach to
high-risk countries, provided that each of the foregoing and any amendments or
modifications thereto shall be subject to the final approval of TDSF in its sole
discretion. Licensee agrees to require all Manufacturers to comply with the
Code, which includes the Manufacturer's consent to, among other things,
unannounced on-site inspections of manufacturing, packaging and distribution
facilities and employer-provided housing, reviews of books and records relating
to employment matters, and private interviews with employees. Any amendments or
modifications to the Code, the Manufacturer's Agreement, the Manufacturer's
Memorandum of Understanding set forth in <U>Schedule 5.1.4(a-2)</U> (the
"<B>Manufacturer's MOU</B>") or the Manufacturer's Facility and Merchandise
Authorization Form set forth in <U>Schedule 5.1.4(a-3)</U> (the "<B>Manufacturer's FAMA</B>")
shall be subject to the approval of TDSF in its sole discretion, <U>provided</U>, that
(x) TDSF shall consult in good faith with Licensee regarding any such amendments
or modifications proposed by TDSF prior to implementing such amendments or
modifications, (y) following such consultation with Licensee, TDSF shall make
any final determination as to whether and how to implement any such amendments
or modifications in its sole discretion and (z) TDSF shall not propose any such
amendments or modifications unless such amendments or modifications shall also
apply to substantially all Softline and/or Toys/Plush consumer products
licensees of TDSF and its Affiliates within the Territory.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Licensee
agrees to have the Audit Firm conduct a compliance inspection of each
Manufacturer prior to any production of Articles in its facility and to use only
Manufacturers that are shown to be in compliance with such inspection. Licensee
also agrees to conduct its own investigation of any claimed or observed
violations of the Code and, if Licensee finds there have been violations of the
Code, to take appropriate and prompt steps to correct such
violations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Licensee
shall provide advance consent to the Audit Firm to report the audit findings
from the compliance inspection of each Manufacturer directly to TDSF, with a
copy to Licensee if Licensee determines to use such Manufacturer to design,
produce, manufacture, package or distribute Articles or components of the
Articles. If egregious violations are identified (as determined by TDSF in its
sole discretion) during any audit (or through Licensee's or TDSF's or their
respective Affiliates' own investigations), Licensee shall no longer use such
Manufacturer for the Articles. With respect to any other violations, TDSF will
prepare a corrective action plan ("<B>CAP</B>") letter and designate for Licensee a
commercially reasonable follow-up audit time-frame. Licensee will inform the
Manufacturer of the necessary corrective actions and the time-frame for the
follow-up audit. Licensee shall work with the Manufacturer to ensure that
remedial actions are promptly implemented by the Manufacturer.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) Licensee at
its expense shall have the Audit Firm perform the follow-up audit in the
time-frame designated in the CAP letter and report the findings directly to TDSF
promptly following the audit. If violations are still found, TDSF will prepare a
follow-up CAP letter. Licensee shall again work with the Manufacturer to ensure
that remedial actions are promptly implemented by the Manufacturer and, at
Licensee's expense, shall again have the Audit Firm perform a follow-up audit in
the time-frame designated in the CAP letter and report the findings promptly to
TDSF. The process outlined in this subparagraph (iv) shall continue until the
Manufacturer reaches compliance with the Code, Licensee elects to terminate or
TDSF, in its sole discretion, directs Licensee to terminate the non-compliant
Manufacturer.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (v) Licensee
acknowledges that TDSF is relying on Licensee's commitment to enforce the Code
in factories and facilities used to produce the Articles. If requested by TDSF,
Licensee will advise the public or other third parties that Licensee's
Manufacturers are contractually responsible to Licensee for adherence to the
Code and that Disney has in good faith relied upon Licensee to assure compliance
with the Code.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Product Safety</U>.
Licensee is fully and solely responsible for the consistent safety of the
Articles and for the compliance of the Articles with applicable Laws (including,
without limitation, applicable product safety Laws), applicable industry
standards, the Disney Product Guidelines and the warranties with respect thereto
set forth in Section 9.6.4. Any Article that fails to comply with any applicable
Law or the Disney Product Guidelines shall be deemed disapproved, even if
previously approved by TDSF, and shall not be sold. Before Licensee puts any
Article on the market, if such Article is of a type that is required to be
safety tested pursuant to the Disney Product Guidelines, Licensee shall ensure
that (i) such Article has been submitted for safety testing to the Product
Safety Laboratory, which shall produce a written report of such safety testing,
(ii) the written report of each such product safety test for each such Article
so submitted has been delivered to TDSF, and (iii) if the test result for such
Article was not positive in any respect or if the test result proposes or
recommends any modifications to make the Article safer, at least three (3)
Business Days have elapsed following the delivery of such written test report to
TDSF without notice from TDSF that such Article has been disapproved by TDSF on
the basis of such negative or qualified test report (whether such qualification
is based on or consists of a recommendation or proposal or other suggested
modification) (and TDSF shall be entitled to disapprove any Article on the basis
of any such product safety test report in its sole discretion, provided that
TDSF shall provide Licensee with its reason or reasons for such disapproval). If
Licensee determines that any Article does not need to be safety tested pursuant
to the Disney Product Guidelines, Licensee shall report to the Product Safety
Director that such Article is not of the type that is required to be safety
tested pursuant to the Disney Product Guidelines and shall consult in good faith
with the Product Safety Director with respect thereto, provided that the final
determination regarding whether any Article is required to be safety tested
pursuant to the Disney Product Guidelines shall be made by TDSF or its
Affiliates in their respective sole discretion. Both before and after Licensee
puts any Article on the market, Licensee shall ensure that its Manufacturers
follow such additional reasonable and proper procedures as may be necessary to
ensure safety control and to ensure that the Articles comply with all applicable
Laws and the Disney Product Guidelines and shall permit TDSF or its designee to
inspect testing, manufacturing and safety control records and procedures and the
Product Safety Laboratory and to test Articles for compliance with product
safety and other applicable Laws and will implement any reasonable and/or
necessary changes in design, materials, manufacturing, labeling or packaging
intended to make any Article more safe or as may be desirable as determined by
TDSF and/or its Affiliates in their respective sole discretion to protect the
image, quality and/or reputation of the Disney Properties and/or Disney
Merchandise. Licensee and/or its Manufacturers shall provide written notice to
TDSF within five (5) Business Days following receipt of any notice of any claim
or suit filed with respect to any Article, or of any investigation, directive or
notice from the U.S. Consumer Product Safety Commission or any other
governmental safety agency. No approval, disapproval or omission of approval or
disapproval by TDSF with respect to any Article given or not given to Licensee
or any Manufacturer under this Agreement shall in any way lessen or mitigate
Licensee's full and sole responsibility under this subparagraph (b) nor
constitute or imply any opinion by TDSF that any Article is safe or complies
with applicable Laws or the Disney Product Guidelines. Licensee shall coordinate
all activities pertaining to product safety and product safety testing pursuant
to this Section 5.1.4(b) with the Product Safety Director. Any breach of this
Section 5.1.4(b) by Licensee that has an adverse impact on the reputation, image
or brand of the Disney Properties or that results in injury to person shall be
deemed a Material Breach of this Agreement by Licensee.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Approval of
Manufacturers</U>. In addition to any requirements set forth in Section 5.1.4(a),
Licensee shall be required to use only Manufacturers that are approved in
advance in writing by TDSF in its sole discretion and that have executed a
Manufacturer's Agreement, a Manufacturer's FAMA and, to the extent required by
TDSF, a Manufacturer's MOU. With respect to any Manufacturer that entered into a
Manufacturer's Memorandum of Understanding with Licensee prior to the Effective
Date but in a different form than the Manufacturer's MOU, Licensee shall be
required to terminate its relationship with any such Manufacturer unless, within
forty (40) Business Days following the Effective Date, Licensee and such
Manufacturer shall have entered into a Manufacturer's MOU in the form contained
on <U>Schedule 5.1.4(a-2)</U>. TDSF shall provide Licensee with a list of any
pre-approved Manufacturers for Articles, and Licensee shall be entitled to use
each such pre-approved Manufacturer for a period of up to six (6) months
following the Effective Date, during which time Licensee shall cause the Audit
Firm to conduct a compliance inspection of each such Manufacturer to confirm its
compliance with the Code and all other requirements of this Section 5.1.4. If
any such Manufacturer is not inspected by the Audit Firm within such 6-month
period, it shall be deemed disapproved by TDSF hereunder as of the end of such
6-month period, and if such inspection is conducted for any such Manufacturer
and such inspection indicates that such Manufacturer is not in compliance with
the Code or such other requirements, such Manufacturer shall, as determined by
TDSF in its sole discretion, either be deemed disapproved by TDSF hereunder or
be subject to the corrective actions set forth under Section 5.1.4(a) with
respect to non-compliant Manufacturers. TDSF's decision to grant or deny its
approval of any Manufacturers not on TDSF's pre-approved list shall be made by
TDSF in its sole discretion, for any reason or no reason, including, without
limitation, TDSF's interest in maintaining the highest product quality
standards, the subject Manufacturer's ILS record, the subject Manufacturer's
credit history, and TDSF's interest in maintaining consistency and continuity in
the presentation of its brands in the marketplace. Licensee shall ensure that,
upon the date of termination or expiration of a Manufacturer's Agreement, a
Manufacturer's FAMA or, as applicable, a Manufacturer's MOU, the subject
Manufacturer shall cease production of all Articles and all components thereof
and shall otherwise comply with the terms of the Manufacturer's Agreement, the
Manufacturer's FAMA and the Manufacturer's MOU with respect to termination of
the relationship.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Name and Address
of Licensee</U>. With respect to Disney Merchandise ordered after the Effective
Date, the name and address of Licensee (i) must appear on permanently affixed
labeling on each Article of such Disney Merchandise, or (ii) if such Article of
such Disney Merchandise is sold to the public in packaging or a container, must
be printed on such packaging or container. On Softlines, "permanently affixed"
shall mean sewn on.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) <U>Unauthorized
Activities</U>. If any Manufacturer utilizes any Licensed Materials for any
unauthorized purpose, Licensee shall cooperate fully in bringing such
utilization to an immediate halt and, upon TDSF's request, Licensee shall
immediately terminate its relationship with such Manufacturer for the
production, manufacturing, packaging and/or distribution of any
Articles.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <U>Potential
Internal Audit Compliance Team and Product Safety Laboratory</U>. Upon Licensee's
request from time to time during the Term, TDSF shall explore the possibility of
Licensee's use of an internal compliance audit team (with respect to inspections
of Manufacturers under Section 5.1.4(a)) and/or an internal product safety
laboratory (with respect to product safety testing pursuant to Section 5.1.4(b)
relating to specified elements or components of certain Articles) in either case
comprised of Licensee's and/or its Affiliates' employees, as opposed to the
third-party Audit Firm contemplated by Section 5.1.4(a) and/or the third-party
Product Safety Laboratory contemplated by Section 5.1.4(b), as the case may be,
to conduct the functions of the Audit Firm or the Product Safety Laboratory, as
applicable, as contemplated by this Section 5.1.4, <U>provided</U> that (i) any such
internal compliance audit team and/or internal product safety laboratory shall
be required to comply with such conditions with respect to capabilities as TDSF
shall determine are necessary in its sole discretion, (ii) any such internal
compliance audit team and/or internal product safety laboratory shall be subject
to periodic review by the Product Safety Director and TDSF and its Affiliates,
with the right to revoke its authorization hereunder if TDSF determines that the
terms and conditions imposed upon such internal compliance audit team and/or
internal product safety laboratory have not been satisfied in any respect, and
(iii) the final determination with respect to whether Licensee shall be entitled
to use any such internal compliance audit team and/or internal product safety
laboratory, and any determination to revoke Licensee's use of any such internal
compliance audit team and/or internal product safety laboratory if it is
approved at any time, shall be made by TDSF in its sole discretion, and Licensee
shall not be entitled to any right or remedy or any abatement of any obligations
hereunder in the event that TDSF does not approve, or revokes any approval of,
any such internal compliance audit team and/or internal product safety
laboratory.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.2 <U>FF&amp;E Materials
and Marketing Materials Approvals</U>. Licensee shall not create, develop,
manufacture, produce, use or distribute (i) any Marketing Materials for the
Business, regardless of whether such Marketing Materials bear, feature or
incorporate any Disney Properties, or (ii) any FF&amp;E Materials that bear,
feature or incorporate any Disney Properties, without first obtaining
TDSF&#146;s approval in accordance with the provisions set forth in this
Section&#160;5.2 in each instance. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.2.1 <U>Original
Submissions</U>. Licensee shall submit to TDSF for approval (i)&#160;all
prototype (<U>i.e.</U>, rough draft) drawings, designs, architectural
renderings, materials, samples and other media (including, without limitation,
publicity copy, artwork and layout) pertaining to the FF&amp;E Materials and
Marketing Materials, (ii)&#160;a brief statement setting forth the proposed use
to which such materials will be put (including, if applicable, the media or
channels through which and the period of time during which such materials will
be distributed or displayed), (iii)&#160;if the materials being submitted by
Licensee are Marketing Materials and involve purchases of broadcast media
(<U>e.g.</U>, over-the-air television, cable television, satellite television
and radio), print media (<U>e.g.</U>, newspapers, periodicals and other
publications), outdoor advertising (<U>e.g.</U>, billboards and other signage)
or any other forms of traditional media advertisements, a draft of a promotional
brief in the form of <U>Schedule 5.2.1</U>, duly completed by Licensee (the
<B>"Promotional Brief"</B>), and (iv)&#160;all other background
information and supporting material as will be reasonably necessary, or as TDSF
may reasonably request, to allow TDSF to make an informed judgment and appraisal
for purposes of TDSF&#146;s approving or disapproving Licensee&#146;s request to
use such Licensed Materials. Licensee shall use commercially reasonable efforts
to submit all such materials described in this Section 5.2.1 to the individual
so designated by TDSF at least sixty (60) Business Days prior to the date of
first intended use. Licensee may, in connection with any original submission
under this Section 5.2.1 of Marketing Materials that will be used solely within
the Facilities or the Internet Store (collectively, <B>"In Store
Materials"</B>), designate such submission as an advertising template that
will be used for multiple advertisements over a specified period of time with
all elements of such template (including, without limitation, the use of Disney
Properties therein), other than certain specified information, remaining
unchanged with each use thereof (each, a <B>"Template"</B>). With
respect to any proposed Template, Licensee shall specify (a) the features and
information contained in such Template that will be changed with each use
thereof, which may not under any circumstances consist of any changes involving
or impacting any of the Disney Properties, (b) the period of time during which
such Template will be used, and (c) the channels of distribution for such
Template (<U>i.e.</U>, within the Facilities and/or the Internet Store). A
Template that has been approved by TDSF pursuant to Section 5.2.2 is referred to
herein as an <B>"Approved Template</B>.<B>"</B> Subject to Section
5.2.3, Licensee shall be entitled to use any Conforming Approved Template during
the approved time period without re-submitting such Conforming Approved Template
for approval pursuant to Section 5.2.2, <U>provided</U>, that, for purposes of
clarification, except as otherwise provided in Section 5.2.2, all of the
requirements set forth in this Section 5.2 with respect to In Store Materials
shall apply to Non-Conforming Approved Templates and Minor Revision Approved
Templates. Notwithstanding anything to the contrary contained herein, TDSF shall
have the right in its sole discretion to alter, modify, discontinue or terminate
the use of any Approved Template at any time upon twenty (20) Business
Days&#146; advance written notice to Licensee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.2.2    <U>Preliminary Approval</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Provided that Licensee has fully complied with Section 5.2.1, TDSF shall use
its commercially reasonable efforts to notify Licensee of its preliminary
approval or disapproval of Licensee's submission of proposed materials
(including the proposed use to which such materials will be put and, if
applicable, the media or channels through which and the period of time during
which such materials will be distributed or displayed) and, as applicable, the
Promotional Brief (i) in the case of In Store Materials (including any proposed
Template but excluding any Approved Template), within ten (10) Business Days
following Licensee's submission of the information required to be submitted
pursuant to Section 5.2.1, (ii) in the case of Non-Conforming Approved
Templates, within ten (10) Business Days following Licensee's submission of the
information required to be submitted pursuant to Section 5.2.1, (iii) in the
case of Minor Revision Approved Templates, within two (2) Business Days
following Licensee's submission of the information required to be submitted
pursuant to Section 5.2.1, (iv) in the case of FF&amp;E Materials, within fifteen
(15) Business Days following Licensee's submission of the information required
to be submitted pursuant to Section 5.2.1, (v) in the case of Marketing
Materials that are not In Store Materials, including, without limitation,
Marketing Materials pertaining to the purchase and/or use of broadcast media,
print media or outdoor advertising, Marketing Materials to be used in connection
with direct marketing activities (including, without limitation, email,
telephone and/or mail solicitations), and any other Marketing Materials to be
distributed or used outside of the Facilities and the Internet Store
(collectively, "<B>Out of Store Materials</B>") (other than Out of Store Materials
consisting of a single piece direct mail solicitation), within twenty (20)
Business Days following Licensee's submission of the information required to be
submitted pursuant to Section 5.2.1, and (vi) in the case of Out of Store
Materials consisting of a single piece direct mail solicitation (including
e-mail solicitations), within fifteen (15) Business Days following Licensee's
submission of the information required to be submitted pursuant to Section
5.2.1. For purposes of clarification, pursuant to and subject to the terms of
Section 5.2.1, Licensee need not submit Conforming Approved Templates for
approval pursuant to this Section 5.2.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) In each
instance where TDSF fails to provide Licensee with any communication indicating
TDSF's approval or disapproval of Licensee's submissions of In Store Materials
that are designed to be used in substantially all of the Facilities
(collectively, "<B>Chain Wide In Store Materials</B>") within the ten (10) Business Day
period described in Section 5.2.2(a)(i) or 5.2.2(a)(ii), as applicable, Licensee
shall be entitled to provide TDSF with written notice of such failure to
communicate a response and, if Licensee provides such written notice and TDSF
fails to communicate its approval or disapproval of the applicable submission
within two (2) Business Days following such written notice from Licensee, then
such failure shall be deemed an "<B>In Store Response Failure</B>"; <U>provided</U>, that
there shall not under any circumstances be deemed to be more than one (1) In
Store Response Failure with respect to any particular submission of Chain Wide
In Store Materials, notwithstanding any further failure by TDSF to respond
thereto. Within twenty (20) Business Days following the end of each half (1/2)
of each Contract Year, TDSF shall pay to Licensee an amount (if positive and if
any) equal to (I)(A) the number of In Store Response Failures occurring during
the immediately preceding six (6) Retail Months of such Contract Year <U>minus</U>
fifteen percent (15%) of the number of submissions by Licensee to TDSF of Chain
Wide In Store Materials during such six (6) Retail Month period of such Contract
Year, <U>multiplied by</U> (B) Five Hundred Dollars ($500), <U>minus</U> (II) Five Hundred
Dollars ($500) (such amount, the "<B>In Store Response Failure Fee</B>"), by wire
transfer to an account designated by Licensee in writing; <U>provided</U>, that, if
during any Retail Month of the applicable six (6) Retail Month period the total
number of submissions of In Store Materials (x) exceeds thirty (30) but is less
than or equal to forty (40), then the number in the preceding subparagraph
(I)(B) shall be reduced from Five Hundred Dollars ($500) to Two Hundred Fifty
Dollars ($250), or (y) exceeds forty (40), then the number in the preceding
subparagraph (I)(B) shall be reduced from Five Hundred Dollars ($500) to Zero
Dollars ($0). Notwithstanding anything to the contrary contained herein, other
than referral of repetitive In Store Response Failures to the Joint Advisory
Committee pursuant to Section 8.3.6, the In Store Response Failure Fee shall be
Licensee's sole and exclusive remedy for any and all In Store Response Failures
and Licensee shall have no other recourse or remedy nor be entitled to any
abatement or reduction of any payments or other obligations hereunder on account
of any such In Store Response Failures. For purposes of clarification, with
respect to submissions of any In Store Materials or Chain Wide In Store
Materials contemplated by this Section 5.2.2(b), each Template and/or item
contained in each such submission shall be counted as a separate submission,
even if submitted concurrently with other In Store Materials or Chain Wide In
Store Materials in the same package of Marketing Materials, <U>provided</U>, that
multiple sizes of an item with the same content (e.g., a single advertisement in
the form of a point-of-sale card, a shelf display and a window display, all in
varying sizes) shall be treated as one item and one submission. In addition, at
the time of its submission of Chain Wide In Store Materials, Licensee shall so
designate such submission, which designation (or lack thereof) shall be binding
on Licensee, although TDSF shall be entitled to dispute any such designation in
its sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) Notwithstanding
anything to the contrary contained in subparagraph (a) of this Section 5.2.2, in
any case where Licensee has re-submitted materials that were previously approved
or disapproved by TDSF under this Section 5.2.2 and were subject to only minor
revisions or refinements, TDSF shall respond to (i.e., approve or disapprove)
such re-submission within five (5) Business Days following Licensee's submission
of such revisions or refinements. In addition, during each Monday-through-Friday
period during the Term, TDSF shall, upon Licensee's request, use its
commercially reasonable efforts to respond to (i.e., approve or disapprove) up
to five (5) submissions of In Store Materials within two (2) Business Days. TDSF
agrees that it shall not exercise its approval rights as described under this
Section 5.2.2 so as to preclude Licensee from providing any disclosures required
by any applicable Law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.3 <U>Final Proofs</U>.
If FF&amp;E Materials or Marketing Materials and, as applicable, the Promotional
Brief are approved by TDSF under Section&#160;5.2.2, at or before the time they
are to be used for general use in the Facilities or the Internet Store or
general distribution to the public, (i)&#160;if applicable, TDSF and Licensee
shall each duly execute the Promotional Brief, which shall be binding upon such
parties, and (ii)&#160;Licensee shall furnish to TDSF final proofs, scripts,
architectural renderings, designs, webpages, samples or versions of all such
materials (including any Non-Conforming Approved Template, Minor Revision
Approved Template and, for informational purposes only, Conforming Approved
Template), indicating the specific use to which they will be put (including, if
applicable, the media or channels through which and the period of time during
which such materials will be distributed or displayed), which final proofs,
scripts, architectural renderings, designs, webpages, samples and versions shall
not differ in any respect from the proposals or prototypes previously
preliminarily approved by TDSF (other than immaterial variations that are not
related to any Disney Property in any manner whatsoever). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.2.4 <U>Final
Approval</U>. Any final submission under Section 5.2.3 for which TDSF has
granted a preliminary approval pursuant to Section 5.2.2, which final submission
does not differ in any respect from the proposals or prototypes previously
preliminarily approved by TDSF (other than immaterial variations that are not
related to any Disney Property in any manner whatsoever), shall be deemed
approved, <U>provided</U>, that TDSF shall be entitled, at any time within ten
(10) Business Days following Licensee&#146;s submission of such materials, to
disapprove any such materials if (i) TDSF finds any of such final proofs,
scripts, architectural renderings, designs, webpages, samples or versions or the
specific use to which they will be put (including, if applicable, the media or
channels through which or the period of time during which such materials will be
distributed or displayed) different in any manner whatsoever from the proposals
or prototypes previously preliminarily approved (other than immaterial
variations that are not related to any Disney Property in any manner
whatsoever), (ii) any (a) alleged or actual copyright and/or trademark
infringement or other Disney IP Claim or any other legal consideration or rights
dispute regarding any intellectual property or (b) corporate brand
considerations, including without limitation, protection of the
"Disney" brand, name, reputation and quality shall, in TDSF&#146;s
sole discretion, require the temporary postponement (or, if necessary,
revocation) of any previous preliminary approval (<U>provided</U>, that in the
case of a revocation pursuant to this subparagraph (ii), TDSF shall reimburse
Licensee for its actual, reasonable out-of-pocket costs and expenses incurred in
connection with the item subject to such revocation from the date the
preliminary approval thereof was granted up to the date such notice of
revocation was given by TDSF to Licensee), or (iii) TDSF determines that
Licensee has failed to comply with any term or condition of the Promotional
Brief related to the Licensed Materials or any other material term or condition
of the Promotional Brief (if applicable), by providing written notice to
Licensee of such disapproval, which notice shall identify the circumstances set
forth in the preceding subparagraphs (i) through (iii) that have resulted in
such disapproval. In the case of any such disapproval, Licensee shall, as soon
as practicable after such notice is given by TDSF, cause the modification or
withholding of such materials or cure the default under the Promotional Brief,
as the case may be. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.2.5 <U>Print, Radio and
Television</U>. Licensee shall obtain all necessary approvals for all print,
radio and television marketing, advertising and promotional materials that TDSF
has approved in accordance with this Section 5.2, and shall ensure that all such
marketing, advertising and promotional materials comply with all applicable
Laws. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.2.6 <U>FF&amp;E
Materials</U>. Licensee shall obtain all necessary approvals (including all
necessary landlord approvals) for all FF&amp;E Materials that TDSF has approved
in accordance with this Section 5.2, and shall ensure that all such FF&amp;E
Materials comply with all applicable Laws, including, without limitation, any
applicable zoning or land use ordinances. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.2.7 <U>Promotional
Brief</U>. The parties agree that the execution of a Promotional Brief is not a
prerequisite to the development and creative approval process for any promotion
hereunder; <U>provided</U>, that execution by the parties of a Promotional Brief
is a prerequisite to the commencement, conduct or public performance of any
promotion identified in subparagraph (iii) of Section 5.2.1. All such promotions
shall be subject to the terms of this Agreement and the applicable Promotional
Brief. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.2.8  **. </FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.3 <U>General Terms
Applicable to TDSF Approval of All Licensed Materials</U>. Notwithstanding
anything contained herein to the contrary, with respect to all submissions by
Licensee under this Section 5, whether consisting of submissions pertaining to
Disney Merchandise, FF&amp;E Materials or Marketing Materials, Licensee
acknowledges and agrees that: (i)&#160;the approval or disapproval of any such
submission shall be at TDSF&#146;s sole discretion; (ii)&#160;if any submission
is disapproved by TDSF, where the proposed use of the Disney Properties by
Licensee would be permissible in accordance with the terms of this Agreement if
modified, TDSF shall, to the extent feasible (and in any event with respect to a
substantial number of submissions), propose in writing alternative suggestions
and recommendations with respect thereto for the purpose of providing Licensee
an opportunity to correct such submission and re-submit it to TDSF;
(iii)&#160;except as otherwise provided with respect to final, conforming
submissions in Section&#160;5.1.2(a) and Section 5.2.4, any submission not
receiving the specific written approval of TDSF shall be deemed disapproved and
unlicensed; (iv) no failure of TDSF to respond within a specified time period
shall be deemed a breach of or default under this Agreement by TDSF under any
circumstances, including, without limitation, any circumstance under which TDSF
is obligated to pay any Response Failure Fee or any In Store Response Failure
Fee; (v)&#160;any submission receiving approval by TDSF will not constitute or
imply a representation or belief by TDSF that such submission complies with any
applicable Laws and/or other policies issued by any Governmental Entity, which
compliance shall be the sole responsibility of Licensee, and, in connection
therewith, Licensee shall, at its sole cost and expense, obtain any required
consents, approvals, permits, licenses or other authorizations that may be
required by any Governmental Entity or applicable Law; (vi)&#160;any approval by
TDSF of a submission may be expressed in an informal written manner, such as by
way of a Representative of TDSF placing his or her signature and the word
"approved" directly upon the proposed submission or by a
Representative of TDSF providing written approval via electronic mail or fax;
and (vii)&#160;at any time during the Term, TDSF shall have the right, in its
sole discretion, by written notice to Licensee, to modify or revoke its approval
of any use of Licensed Materials in accordance with this Section&#160;5,
<U>provided</U>, that such notification shall advise Licensee of the nature of
the changes required or the reasons for the revocation and shall be subject to
the terms of Section&#160;4.9 (including the reimbursement provisions set forth
in such Section as if such notification were a Withdrawal Determination). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.4 <U>Unique Nature of
Agreement</U>. Licensee acknowledges and agrees that TDSF and its Affiliates
place the utmost importance on the conservation and protection of the Disney
Properties, the Licensed Materials, and all other names, brands, trademarks,
logos, symbols, characters and other propriety designations and intellectual
property of TDSF and its Affiliates. TDSF entered into the transactions
contemplated by this Agreement only after a careful and methodical process
pursuant to which TDSF selected TCP, Licensee Parent and Canadian Parent to be
the indirect and direct owners of Licensee, which is the sole licensee
hereunder, from among a wide range of other potential candidates. TDSF assessed
that Licensee, being owned by TCP, Licensee Parent and Canadian Parent, was
uniquely well qualified to perform the obligations of the licensee under this
Agreement and imposed upon Licensee the specific, highly customized terms,
conditions and procedures set forth herein, which are specifically tailored to
provide the highest level of protection for the Disney Properties and Licensed
Materials. Such terms, conditions and procedures include, among other things,
(i) TDSF&#146;s right to approve each and every Licensee use of the Disney
Properties and Licensed Materials in TDSF&#146;s sole discretion, as well as
other related approval rights, (ii) the right of TDSF, without limiting its
other rights and remedies, to seek equitable relief in a court of law in the
case of a Licensee Infringing Use or other Licensee breach of this Agreement,
(iii) the right of TDSF to cure breaches and other forms of non-compliance of
Licensee with funds made available by Licensee in accordance with Section 9.10,
(iv) the fact that the limitation on liability of the parties pursuant to
Section&#160;21.22 does not apply to Licensee&#146;s misuse of the Disney
Properties or Licensed Materials, (v) the right of TDSF to terminate this
Agreement if Licensee attempts certain prohibited assignments of this Agreement
or if certain change of control transactions occur, and (vi)&#160;the rights of
TDSF and the obligations of TCP and Licensee Parent arising under the TCP
Guaranty and Commitment. Licensee acknowledges and agrees that, if Licensee had
not been the other party to this Agreement or had not been acquired by TCP,
Licensee Parent and Canadian Parent pursuant to the Acquisition Agreement or had
not agreed to the specific, carefully tailored terms, conditions and procedures
set forth herein, TDSF would not have agreed to enter into this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.5 <U>Quality Control</U>.
In connection with its use of the Licensed Materials, Licensee shall at all
times maintain a level of quality that is consistent with those maintained by
TDSF and its Affiliates with respect to the respective Disney Properties
incorporated therein and with the quality levels prevailing among full-priced
specialty retail chains focused on children&#146;s consumer products. TDSF shall
from time to time inspect (provided that it shall endeavor to provide at least
three (3) Business Days notice of such inspection) Licensee&#146;s operations to
ensure Licensee&#146;s compliance with the foregoing quality control standards,
and Licensee shall make available the Business Properties, copies of all
webpages from the Internet Store, Licensee&#146;s books and records, and its
management and employees to assist TDSF with such inspection in accordance with
Section&#160;9.10.1. Any failure to comply with such quality control standards
by Licensee shall be deemed a Material Breach by Licensee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.6 <U>Other
Limitations</U>. Licensee shall not, under any circumstances, use any Disney
Properties or Licensed Materials for the design, development, production,
manufacture, distribution, sale or use of any Disney Merchandise, FF&amp;E
Materials or Marketing Materials that are or may be harmful to or may impair the
prestige, good name and reputation and/or goodwill of the Disney Properties, the
Licensed Materials, or any other name, brand, trademark, logo, symbol, character
or other proprietary designation or intellectual property of TDSF and/or its
Affiliates. Without limiting the generality of the foregoing restriction, any
use of any Disney Property in connection with any of the following is expressly
prohibited: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Disney
Merchandise or other Licensed Materials that are harmful to children or
potentially detrimental to their characters, including, without limitation,
tobacco products and accessories, alcoholic beverages (including beer and wine)
and accessories, and gambling devices; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) products not
manufactured in compliance with the requirements of the Code; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) medicines,
vitamins, herbs, nutritional supplements and drugs (whether prescription,
over-the-counter or otherwise); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) personal
hygiene products (but not including generic personal care products such as paper
handkerchiefs, toothbrushes, soaps, cosmetics, nail polish and shampoo) and
toilet articles for men or women; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) any comic
material or character not owned by or licensed to TDSF or any of its Affiliates;
and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) any Disney
Merchandise or other Licensed Materials that publicize or promote any motion
picture, television program, internet site, interactive game, or other consumer
product or service, if such motion picture, television program, internet site,
interactive game, or other consumer product or service is not (i) a Disney
Property or owned by or licensed to TDSF or any of its Affiliates and (ii)
approved for use hereunder in writing by TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.7 <U>Exceptions</U>. The
following shall be deemed to have been approved by TDSF under this
Section&#160;5 as of the Effective Date: (i)&#160;any pre-production sample or
production sample of any Article of Disney Merchandise that, as of the Effective
Date, has been completed, (ii)&#160;any FF&amp;E Materials existing at, in
transit to, or on order for the Facilities as of the Effective Date,
(iii)&#160;any Marketing Materials that have been printed or produced in final
form as of the Effective Date or for which a purchase order has been issued as
of the Effective Date, or (iv)&#160;any Article of the type described in the
last sentence of the definition of "Disney Merchandise." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.8 <U>Business Stationery
and Related Materials</U>. Licensee shall be authorized to use the name
<I>"Disney Store" </I>in connection with Licensee&#146;s business
cards, stationery, letterhead paper, purchase orders and other comparable paper
instruments used to identify Licensee, provided that (i) in each such case
Licensee&#146;s corporate name (<U>e.g.</U>, "Hoop Retail Stores,
LLC", the proposed name of the successor upon merger of TDS USA) shall also
be displayed in a prominent manner to avoid confusion between the Facilities and
Licensee, on the one hand, and TDSF and its Affiliates, on the other hand, and
(ii) the size, style, design and all other elements and components of each such
use of the <I>"Disney Store"</I> name (including, without limitation,
the manner in which Licensee&#146;s corporate name is used in connection
therewith) shall be subject to the final approval of TDSF in its sole
discretion. Notwithstanding anything to the contrary contained in this
Agreement, except for the use of the <I>"Disney Store" </I>name in the
manner contemplated by the preceding sentence, Licensee acknowledges and agrees
that it shall not be entitled to use any other Disney Properties or Licensed
Materials on any of Licensee&#146;s or its Affiliates&#146; business cards,
stationery, letterhead paper, purchase orders or other comparable instruments
used to identify Licensee or its Affiliates, whether in paper, electronic or
other form. </FONT></P>

<P><FONT SIZE=3>6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>PRESERVATION OF PROMOTIONAL VALUE</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.1 <U>Preservation of
Licensee&#146;s Promotional Value</U>. During the Term and within the Territory,
subject to the provisions set forth below in this Section&#160;6.1 and Section
6.2 and except as otherwise specifically provided under the terms of this
Agreement, neither TDSF nor any of its Affiliates shall, nor shall TDSF or any
of its Affiliates authorize any third party to: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (A) **;
</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (B) use (i) the
name "<I>Disney Store</I>" or any other name that includes the words "<I>Disney Store</I>"
(other than in connection with the Facilities as operated by Licensee) or (ii)
in connection with the offer or sale of Softlines and/or Toys/Plush through
physical (not "virtual" or online) retail stores that are operated on either a
stand-alone basis or in a Store-Within-a-Store Format, any other Restricted
Name; or</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (C) following the
Internet Start Date, use any of the TDS Internet Domains other than in
connection with the Internet Store.</FONT></P>

<P><FONT SIZE=3>Notwithstanding the foregoing or any other provision contained
in this Agreement to the contrary, Licensee acknowledges and agrees that nothing
contained in this Agreement, including, without limitation, the preceding
subparagraphs of this Section 6.1, shall be deemed to limit, restrict or
otherwise apply in any manner whatsoever to any of the following activities,
each of which shall be deemed to be a business, operation or activity in which
TDSF and/or any of its Affiliates shall be entitled to participate, directly or
indirectly through or with one (1) or more unrelated third parties, without any
restriction or limitation whatsoever:
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.1 <U>Flagship Stores,
Designated WDW Stores and El Capitan</U>. TDSF and its Affiliates shall be
entitled to, and to authorize any unrelated third party to, own, lease, license,
control, maintain, manage, staff, supply, administer, market, advertise, promote
and otherwise operate (including, without limitation, the right to create,
manufacture, cause the manufacture of, source, distribute, offer for sale, and
sell consumer products bearing, featuring or incorporating one (1) or more
Disney Properties for and in such locations), in such manner and for such period
of time as TDSF and/or any of its Affiliates shall elect in their sole
discretion, (a) the "flagship" and studio stores operating under the
<I>"Disney Store"</I> name existing as of the Effective Date and
located at (i)&#160;711 Fifth Avenue, New York, New York and (ii)&#160;500 South
Buena Vista Street, Burbank, California (Disney Studio Lot) (collectively, the
<B>"TDSF Flagship Stores"</B>), (b) the stores related to WALT DISNEY
WORLD Resort existing as of the Effective Date and located at (i) the Ocala
Welcome Center, (ii) 3200 International Drive, Kissimmee, Florida (Gaylord Palms
Hotel), and (iii) 9101 International Drive, Suite 1212, Orlando, Florida (Disney
World Port) (collectively, the <B>"Designated WDW Stores"</B>), and
(c) the Disney Retained Store located within the El Capitan; <U>provided</U>,
that (x) except in the case of the TDSF Flagship Store located in Burbank,
California described in the preceding subparagraph (a)(ii), no such TDSF
Flagship Store or Designated WDW Store shall be operated under any Restricted
Name and (y) the parties acknowledge that the <I>"Disney Store"</I>
located within the El Capitan will be operated by Licensee as a Disney Retained
Store under the <I>"Disney Store"</I> name until such time as TDSF
shall designate in its sole discretion for its closure, at which time an
alternative retail location, operated under a name other than <I>"Disney
Store"</I> and located within the El Capitan, may be operated by TDSF or
its Affiliates or its third party designee (other than Licensee) for so long as
TDSF or its Affiliates may determine in their sole discretion as if it were a
TDSF Flagship Store under this Section 6.1.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.1.2 <U>Disney Retained
Stores</U>. TDSF and its Affiliates shall be entitled to, and to authorize any
unrelated third party (including, without limitation, Licensee) to, own, lease,
license, control, maintain, manage, staff, supply, administer, market,
advertise, promote and otherwise operate (including, without limitation, the
right to create, manufacture, cause the manufacture of, source, distribute,
offer for sale, and sell consumer products bearing, featuring or incorporating
one (1) or more Disney Properties for and in such locations), in such manner
(including, without limitation, under any Restricted Name) as TDSF and/or any of
its Affiliates shall elect in their sole discretion, each of the Disney Retained
Stores (other than the TDSF Flagship Stores, which are covered by
Section&#160;6.1.1, and other than the alternative retail location operated
within the El Capitan as contemplated by subparagraph (y) of Section 6.1.1 after
the closure of the Disney Retained Store located therein) until such time as the
lease for each such Disney Retained Store existing as of the Effective Date has
expired or has been terminated in a manner acceptable to TDSF and/or its
Affiliates in their sole discretion or the operations of such Disney Retained
Stores have otherwise been terminated in a manner acceptable to TDSF and/or its
Affiliates in their sole discretion (and <U>provided,</U> that, at the direction
of TDSF and/or its Affiliates, Licensee shall conduct the closure of any such
Disney Retained Stores operated by Licensee in a commercially reasonable time
and manner, in accordance with any applicable agreements between TDSF, Licensee
and/or their respective Affiliates with respect to the operation of such Disney
Retained Stores and in accordance with such reasonable instructions as TDSF
and/or its Affiliates shall specify). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.1.3 <U>Other Disney
Retail Stores</U>. TDSF and its Affiliates shall be entitled to, and to
authorize any unrelated third party to, own, lease, license, control, maintain,
manage, staff, supply, administer, market, advertise, promote and otherwise
operate (including, without limitation, the right to create, manufacture, cause
the manufacture of, source, distribute, offer for sale, and sell consumer
products bearing, featuring or incorporating one (1) or more Disney Properties
for and in such locations), in such manner (including, without limitation, under
any Restricted Name) and for such period of time as TDSF and/or any of its
Affiliates shall elect in their sole discretion, retail stores that are (i)
located within any Theme Park owned, leased, licensed, controlled and/or
operated by or on behalf of TDSF and/or any of its Affiliates, including,
without limitation, WALT DISNEY WORLD Resort and DISNEYLAND Resort, (ii) located
within a five (5) mile radius of any Theme Park (including, without limitation,
WALT DISNEY WORLD Resort) owned, leased, licensed, controlled and/or operated by
or on behalf of TDSF and/or any of its Affiliates, except that, with respect to
DISNEYLAND Resort and any Theme Park owned, leased, licensed, controlled and/or
operated by or on behalf of TDSF and/or any of its Affiliates that is located in
a major metropolitan area and first opened to the public after the Effective
Date, such radius shall be limited to two and one-half (2&#189;) miles, (iii)
located within any airport located in or near the same city as any Theme Park
owned, leased, licensed, controlled and/or operated by or on behalf of TDSF
and/or any of its Affiliates, including, without limitation, WALT DISNEY WORLD
Resort and DISNEYLAND Resort, (iv) located within, on the grounds of, adjacent
to or within one thousand (1,000) feet of any hotel, motel, condominium, Disney
Vacation Club or other time-share style accommodations (including, without
limitation, the Disney Vacation Clubs operated as of the Effective Date in
Hilton Head, South Carolina and Vero Beach, Florida) or comparable lodging
establishment owned, leased, licensed, controlled and/or operated by or on
behalf of TDSF and/or any of its Affiliates, or (v) located within any other
location that is owned, leased, licensed, controlled and/or operated by or on
behalf of TDSF and/or any of its Affiliates that is not<I> </I>primarily focused
on retail sales of consumer products but that may contain one (1) or more retail
locations at which consumer products bearing, featuring or incorporating one (1)
or more of the Disney Properties may be offered for sale (by way of illustration
and without limitation, the New Amsterdam Theater in New York City; cruise ships
of and port terminals for the Disney Cruise Line; or a Disney-themed mixed-use
family amusement center that features Disney-themed rides, games, restaurants,
theaters, children&#146;s clubs and, as one component thereof, retail stores). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.1.4 <U>Outlet Stores</U>.
TDSF and its Affiliates shall be entitled to, and to authorize any unrelated
third party to, own, lease, license, control, maintain, manage, staff, supply,
administer, market, advertise, promote and otherwise operate (including, without
limitation, the right to create, manufacture, cause the manufacture of, source,
distribute, offer for sale, and sell consumer products bearing, featuring or
incorporating one (1) or more Disney Properties for and in such locations), in
such manner (including, without limitation, under any Restricted Name other than
any name that includes the words <I>"Disney Store"</I>) and for such
period of time as TDSF and/or any of its Affiliates shall elect in their sole
discretion, up to twenty-five (25) Outlet Stores within the Territory, a
material purpose of which is liquidating inventories of consumer products
bearing, featuring or incorporating one (1) or more of the Disney Properties;
<U>provided</U>, that, following the Effective Date, if TDSF and its Affiliates
elect to open a new Outlet Store, the location thereof shall not, as of the date
on which the site of such Outlet Store is identified to Licensee by written
notice from TDSF, be within a five (5) mile radius of any then existing
Facility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.1.5
<U>Direct-to-Consumer</U>. TDSF and its Affiliates shall be entitled to, and to
authorize any unrelated third party to, own, lease, license, control, maintain,
manage, staff, supply, administer, market, advertise, promote and otherwise
operate (including, without limitation, the right to create, manufacture, cause
the manufacture of, source, distribute, offer for sale, and sell consumer
products bearing, featuring or incorporating one (1) or more Disney Properties
for and through such means), in such manner (including, without limitation,
under any Restricted Name other than any name that includes the words
<I>"Disney Store"</I>) and for such period of time as TDSF and/or any
of its Affiliates shall elect in their sole discretion, any direct-to-consumer
retail business, including, without limitation, (i) any mail or telephone order
retail business, (ii) any online, electronic, "virtual" or paper
catalog business, including the existing "Disney Catalog" business
owned and operated by Affiliates of TDSF, and (iii) any Internet, online,
electronic or "virtual" business, including the existing Internet
business owned and operated by Affiliates of TDSF located at
<U>www.disneycatalog.com</U>, notwithstanding the fact that any such business of
TDSF or its Affiliates may be directly competitive with the Internet Store
operated by Licensee, <U>provided</U>, that, following the Internet Start Date,
TDSF and its Affiliates shall not use, or authorize any unrelated third party to
use, any of the TDS Internet Domains in the operation of any such Internet,
online, electronic or "virtual" business, but <U>provided</U>
<U>further</U>, that TDSF and its Affiliates shall be permitted in connection
therewith to use other Internet domain names that incorporate the name
"Disney" or any Disney Property other than the name <I>"Disney
Store"</I> (<U>e.g.</U>, <U>www.disneycatalog.com</U> or any Restricted
Name other than <I>"Disney Store"</I>) (such direct-to-consumer retail
businesses operated by TDSF and its Affiliates, including those described in the
preceding subparagraphs (i), (ii) and (iii), the <B>"DDM
Business"</B>) . For purposes of clarification, Licensee acknowledges and
agrees that, prior to the Internet Start Date, TDSF or its Affiliates shall
continue to operate the Internet retail business located at
<U>www.disneystore.com</U> and conducted by TDSF and its Affiliates as of the
date of the Acquisition Agreement, such operation to be conducted by and through
the TDS Internet Domains until the Internet Start Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.1.6 <U>Temporary
Liquidation Stores</U>. TDSF and its Affiliates shall be entitled to, and to
authorize any unrelated third party to, own, lease, license, control, maintain,
manage, staff, supply, administer, market, advertise, promote and otherwise
operate (including, without limitation, the right to source, distribute, offer
for sale, and sell consumer products bearing, featuring or incorporating one (1)
or more Disney Properties for and in such locations), in such manner (including,
without limitation, under any Restricted Name other than any name that includes
the words <I>"Disney Store"</I>) and at such times as TDSF and/or any
of its Affiliates shall elect in their sole discretion, up to twenty (20)
Temporary Liquidation Stores within the Territory per Contract Year;
<U>provided</U> that (i) a material purpose of such Temporary Liquidation Stores
shall be liquidating inventories of consumer products bearing, featuring or
incorporating one (1) or more of the Disney Properties and (ii) the location of
any such Temporary Liquidation Store opened after the Effective Date shall not,
as of the date on which the site of such Temporary Liquidation Store is
identified to Licensee by written notice from TDSF, be within a five (5) mile
radius of any existing Store Facility or, if such Temporary Liquidation Store is
located within a twenty (20) mile radius of any Theme Park of TDSF or its
Affiliates, then within a two (2) mile radius of any existing Store Facility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.1.7 <U>Existing
Authorizations to Use Restricted Names</U>. Notwithstanding anything to the
contrary contained in this Agreement, including, without limitation,
subparagraph (B) of Section 6.1, any Contract existing as of the Effective Date
that authorizes any Person to use any Restricted Name (an <B>"Existing
Restricted Name Agreement"</B>), including, without limitation, any
Contract set forth on <U>Schedule 6.1.7</U>, shall not be prohibited by this
Agreement, <U>provided</U>, that, following the Effective Date, unless such use
is permitted by any of the provisions of this Agreement (including, without
limitation, Section 6.1.1, 6.1.2, 6.1.3, 6.1.4, 6.1.5 or 6.1.6), any such
authorization shall not be extended or renewed following the expiration date
thereof as provided under the terms of any such Contract (unless such extension
or renewal is automatic under, or otherwise required or permitted (including,
without limitation, upon the exercise of any option or right to renew or extend
for any specified period(s) of time) by, the terms of such Contract). For
purposes of clarification, the Contracts set forth on <U>Schedule 6.1.7</U>
reflect TDSF&#146;s good faith efforts to identify all Existing Restricted Name
Agreements as of the Effective Date, but <U>Schedule 6.1.7</U> shall not be
deemed to be an exhaustive list of all such Contracts and neither the omission
of any such Contract from such <U>Schedule 6.1.7</U> nor the use of any
Restricted Name by any Person pursuant to any such Contract that is not set
forth on such <U>Schedule 6.1.7</U> shall be or be deemed to be a breach by TDSF
of Section 6.1 or any other provision of this Agreement, and no representation
or warranty is made or deemed to be made hereby with respect to the completeness
or accuracy of <U>Schedule 6.1.7</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6.2
<U>Other Channels of Distribution Not Limited</U>. For purposes of
clarification, Licensee acknowledges and agrees that, except and only to the
extent specifically set forth in Section 6.1, notwithstanding anything to the
contrary contained in this Agreement, nothing contained in this Agreement shall,
nor shall it be deemed to, limit, restrict or otherwise prohibit in any manner
whatsoever TDSF and/or any of its Affiliates (or any unrelated third party
authorized or permitted by TDSF and/or any of its Affiliates) from creating,
manufacturing, causing the manufacture of, sourcing, distributing, offering for
sale and selling consumer products that bear, feature or incorporate one (1) or
more of the Disney Properties through or into or by way of any channel of
distribution (whether existing as of the Effective Date or developed
thereafter), including, without limitation, the unlimited right of TDSF and/or
its Affiliates (or any unrelated third party authorized or permitted by TDSF
and/or any of its Affiliates) to (i) offer for sale and sell such consumer
products that bear, feature or incorporate one (1) or more of the Disney
Properties through mass merchandisers (<U>e.g.</U>, Wal-Mart, Target, K-Mart,
Costco, Sam&#146;s Club), department stores (<U>e.g.</U>, Sears, JC Penney,
Macy&#146;s Bloomingdale&#146;s, Nordstrom), specialty retail stores
(<U>e.g.</U>, Gap, Gymboree, The Limited), toy stores (<U>e.g.</U>, Toys "R" Us,
KB Toys), "five&#160;&amp;&#160;dime" style stores (<U>e.g.</U>,
Woolworth&#146;s), drug stores (<U>e.g.</U>, Walgreens, Rite-Aid), and
individual or "mom&#160;&amp;&#160;pop" type stores, in each case including,
without limitation, in a Store-Within-a-Store Format, and/or (ii) grant a DTR
License for any or all Disney Properties to any such mass merchandiser,
department store, specialty retail store, toy store, "five&#160;&amp;&#160;dime"
store, drug store or "mom&#160;&amp;&#160;pop" store or any other Person
enabling such retailer or other Person to create, manufacture, cause the
manufacture of, source, distribute, offer for sale and sell consumer products
that bear, feature or incorporate one (1) or more of the Disney Properties
through their respective channel(s) of distribution, subject only to the
following: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6.2.1 **;
</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.2.2 In addition to the
provisions of Section 6.2.1, TDSF&#146;s and its Affiliates&#146; right to grant
one (1) or more DTR Licenses with respect to any and all categories of consumer
products to one (1) or more chains of Specialty Retail Stores shall be subject
to the following limitations: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) During the
Term, (i) at least fourteen (14) Business Days prior to granting or voluntarily
renewing any DTR License authorizing one (1) or more Property-Product
Combinations to a chain of Specialty Retail Stores, TDSF or any such Affiliate
shall provide to Licensee written notice of its desire to so grant or
voluntarily renew such DTR License (the "<B>DTR Notice</B>"), which DTR Notice
shall set forth (x) the approximate proposed initial term and renewal term(s),
if any, of such DTR License and only such additional material non-economic,
non-financial terms or information of such DTR License as are necessary to
enable Licensee to perform the calculations required pursuant to this Section
6.2.2(a) (without any requirement to identify by name the entity potentially
entering into such DTR License) and (y) **, and (ii) **, provided, that (xx) the
preceding subparagraphs (i) and (ii) of this Section 6.2.2(a) shall apply only
in the case of any such voluntary renewal following the expiration date of the
applicable DTR License as provided under the terms thereof and shall not under
any circumstances apply in the case of any such renewal that is automatic under,
or otherwise required or permitted (including, without limitation, upon the
exercise of any option or right to renew or extend for any specified period(s)
of time) by, the terms of such DTR License and (yy) for purposes of
clarification, (1) if any such DTR License to be granted by TDSF or its
Affiliates to a chain of Specialty Retail Stores does not provide for a license
with respect to any of the DTR Product Categories or (2) if any such DTR License
to be granted by TDSF or its Affiliates to a chain of Specialty Retail Stores
does not provide for a license with respect to any of the Character Properties,
then in either such case the provisions of this Section 6.2.2(a) shall not be
applicable to such DTR License nor limit, restrict or otherwise prohibit such
DTR License in any manner whatsoever;</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) **;
</FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) **; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) **; </FONT></P>


<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6.2.3 In addition
to the provisions of Section 6.2.1, TDSF&#146;s and its Affiliates&#146; right
to grant one (1) or more DTR Licenses with respect to any and all categories of
consumer products to one (1) or more Mass Merchandisers shall be subject to the
following limitations: **; and
</FONT></P>


<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6.2.4 For purposes
of clarification, the limitations set forth in the preceding Sections 6.2.2 and
6.2.3 shall not, under any circumstances, apply to or be deemed to apply to (i)
any Non-Disney-Branded Properties; **. </FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6.3 <U>Preservation
of TDSF&#146;s Promotional Value</U>. Without the prior written consent of TDSF,
during the Term and throughout the world, except as contemplated by this
Agreement, Licensee shall not, nor shall it permit or authorize TCP, Licensee
Parent, Canadian Parent or any of their Affiliates or any unrelated third party
on its or their behalf to, (i) offer for sale or sell Disney Merchandise or any
other consumer products or services bearing, featuring or incorporating one (1)
or more of the Disney Properties or any other names, brands, trademarks, logos,
symbols, characters or other proprietary designations or intellectual property
that are owned, licensed or otherwise controlled by TDSF and/or its Affiliates
by or through any venue, methodology, channel of distribution or other means
(including, without limitation, by or through catalogs, mail order, telephone
order (other than incidental telephone sales conducted in connection with the
customer service operations of the Internet Store) or other comparable
direct-to-consumer channels of distribution) or otherwise exercise any of
Licensee&#146;s rights or benefits under this Agreement other than (a) by and
through the Facilities and the Internet Store in the manner specifically
contemplated by and approved by TDSF under this Agreement, (b) to TDSF, its
Affiliates and Other Disney Store Operators, or (c) in the case of inventories
of excess, discontinued or obsolete Disney Merchandise or slightly irregular
Softlines of Disney Merchandise (<U>e.g.</U>, imperfect color, stitching,
sizing), to unrelated third parties engaged in the business of liquidating
excess inventory <B>("Liquidators"</B>), <U>provided</U>, that the aggregate
Original Retail Price of all Disney Merchandise sold to Liquidators during the
Stub Period or any Contract Year shall not exceed three percent (3%) of Net
Retail Sales for the Stub Period or such Contract Year, respectively, or
(ii)&#160;own, lease, license, control, maintain, manage, staff, supply,
administer, market, advertise, promote or otherwise operate or assist in the
operation of any other specialty retail store or stores that are primarily
focused on the offer to sell or sale of consumer products or services that
feature one (1) or more character-based or character-themed properties,
including, without limitation, properties consisting of names, brands,
trademarks, logos, symbols, characters or other proprietary designations or
intellectual property that are generally known to the public as being associated
with (a) any Theme Parks, (b) any animated motion pictures, television programs,
home videos and/or other similar forms of media, (c) children-oriented
theatrical productions and publishing properties, and/or (d)&#160;other
comparable entertainment properties, <U>provided</U>, that any specialty retail
store that is owned or leased and controlled and operated by TCP or its
Affiliates (other than Licensee Parent, Licensee, Canadian Parent and their
respective Subsidiaries) shall be permitted to offer for sale and sell consumer
products or merchandise that feature one (1) or more character-based or
character-themed properties that are owned solely, exclusively and directly by
TCP or its Affiliates (other than Licensee Parent, Licensee, Canadian Parent and
their respective Subsidiaries) (such properties, the <B>"TCP Characters"</B>) so
long as such consumer products or merchandise featuring such TCP Characters are
offered in no more than fifteen percent (15%) of any such specialty retail
store&#146;s Public Merchandising Space (<U>provided</U> that such fifteen
percent (15%) restriction shall not apply to any such consumer products or
merchandise if the respective TCP Character has been adopted as TCP&#146;s
official logo or mark and is featured on substantially all of the consumer
products and merchandise offered at all such specialty retail stores).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
6.4 <U>Right of First
Negotiation With Respect to NDB Stores</U>. In the event that, during the Term
and within the Territory, TDSF and/or any of its Affiliates elect, in their sole
discretion, to operate or engage a third party to operate any NDB Store, then
TDSF shall provide Licensee with written notice thereof, and if Licensee
provides written notice within five (5) Business Days of Licensee&#146;s receipt
of TDSF&#146;s written notice of Licensee&#146;s desire to negotiate with TDSF
or its Affiliates in good faith, thereafter TDSF shall negotiate with Licensee
in good faith and exclusively, for a period of two (2) months following
TDSF&#146;s written notice to Licensee, regarding the terms and conditions upon
which, and the separate consideration for which, TDSF would engage Licensee to
be the operator of the NDB Stores within the Territory. Each of TDSF and
Licensee shall be entitled to decide whether to enter into any such agreement or
arrangements in its sole discretion and may terminate such discussions at the
end of such two (2) month period without recourse or remedy by the other party
and without any abatement or reduction of any payments or other obligations
hereunder. Any agreement reached under this Section 6.4 shall be memorialized in
a separate written agreement. In the event that Licensee declines TDSF&#146;s
invitation to negotiate (or fails to respond to it within five (5) Business Days
following TDSF&#146;s written notice) or the parties fail to enter into a
definitive written agreement within such two (2) month period, then TDSF and/or
any of its Affiliates shall be entitled to operate, and/or negotiate and enter
into any agreement on any terms and conditions whatsoever with any other Person,
including any Person who competes directly or indirectly with Licensee or its
Affiliates, to be the operator of, the NDB Stores within the Territory, without
recourse or remedy by Licensee and without any abatement or reduction of any
payments or other obligations of Licensee hereunder. Notwithstanding anything to
the contrary contained in this Agreement, this Section 6.4 shall not apply to
any NDB Store pertaining to or operated under any name, brand, trademark, logo,
symbol or other proprietary designation of Miramax, as to which Licensee shall
have no rights hereunder and as to which there shall be no restrictions under
this Agreement. </FONT></P>

<P><FONT SIZE=3>7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>ROYALTIES</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.1 <U>Payments</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.1.1 <U>Monthly
Royalties</U>. In consideration of the rights, benefits and privileges granted
to Licensee by TDSF under this Agreement, except as set forth in Section 7.1.2
and Section 7.1.3 and subject to Section 7.6, Licensee shall pay to TDSF, on or
before the seventh (7<FONT SIZE=1>th</FONT>) Business Day of each Retail Month during the
Term in respect of the preceding Retail Month of the Term, an amount equal to
(I) five percent (5%) of (A) all Net Retail Sales generated in the Facilities
during the Retail Month immediately preceding the Retail Month of payment and
(B) all sales of Disney Merchandise to Liquidators pursuant to Section 6.3(i)(c)
during the Retail Month immediately preceding the Retail Month of payment
(collectively, the <B>"Monthly Facilities Royalty Amount"</B>)
<U>plus</U> (II) (i) for one (1) year following the Internet Start Date, five
percent (5%) of all Net Retail Sales generated through the Internet Store during
the Retail Month immediately preceding the Retail Month of payment or (ii)
following the first (1<FONT SIZE=1>st</FONT>) anniversary of the Internet Start Date,
either (a) nine percent (9%) of all Net Retail Sales generated through the
Internet Store or (b) for any period during which TDSF or any of its Affiliates
provides the Hyperlink as described in subparagraph (vii) of Section 9.3.2(b),
ten percent (10%) of all Net Retail Sales generated through the Internet Store,
which Net Retail Sales, in the case of the preceding subparagraphs (ii)(a) and
(ii)(b), were generated through the Internet Store during the Retail Month
immediately preceding the Retail Month of payment (each, the <B>"Monthly
Internet Store Royalty Amount"</B>). For purposes of this Agreement,
<B>"Net Retail Sales"</B> shall mean the aggregate amount of all
revenues generated from all sales of goods, products, merchandise, services or
other items of any kind in the Facilities or the Internet Store (including,
without limitation, any sales through any New Sales Medium without regard to the
method by which Licensee is compensated for sales through any such New Sales
Medium and the amount of all sales generated when Disney Dollars and/or Gift
Cards are used as a method of payment or otherwise redeemed in the Facilities
or, with respect to Gift Cards, the Internet Store, including through any New
Sales Medium, without reduction for any Stored Value Card Fee), excluding only
(1)&#160;revenues generated and commissions retained by Licensee from the sale
of any Theme Park Admission Passes in accordance with Section&#160;9.9.1 and
<U>Schedule 9.9.1</U> (which Theme Park Admission Passes shall only be available
through the Facilities and not the Internet Store), (2)&#160;revenues generated
from the sale of Disney Dollars (which shall only be available for sale in the
Facilities and not through the Internet Store) and Gift Cards (in the case of
Disney Dollars and Gift Cards, as opposed to the use thereof as a method of
payment) and the sale of theater tickets for theatrical productions owned and
produced by TDSF or its Affiliates, (3) the amount of any product returns and
any refunds, credits, allowances and adjustments paid or otherwise provided to
customers with respect to any goods, products, merchandise, services or other
items sold in the Facilities or the Internet Store (including through any New
Sales Medium), (4) the amount of any sales or similar Taxes on goods, products,
merchandise, services or other items, (5) the amount of any shipping expenses
charged to customers in connection with the sale of Disney Merchandise in the
Facilities or the Internet Store, (6) proceeds from insurance with respect to
property damage or liability suffered or incurred by Licensee, (7) proceeds
received by Licensee in connection with any civil forfeiture, condemnation or
other seizure of any Business Property by any Governmental Entity and (8) the
amount of any account balances or other receivables relating to sales of goods,
products, merchandise, services or other items in the Facilities or the Internet
Store that are charged off as uncollectible in accordance with GAAP and
Licensee&#146;s past practice since the Effective Date (each such account
balance or other receivable, a <B>"Charged Off Receivable"</B>),
<U>provided</U>, that, for purposes of this subparagraph (8), (A) the amount of
any such Charged Off Receivable shall be excluded from Net Retail Sales for the
Fiscal Year of Licensee in which such account balance or other receivable is
charged off, (B) under no circumstances shall the aggregate amount of Charged
Off Receivables excluded from Net Retail Sales for any Fiscal Year of Licensee
exceed one-half of one percent (0.5%) of Net Retail Sales for such Fiscal Year
of Licensee and (C) if any such Charged Off Receivable is subsequently collected
during the Term, the amount thereof shall be included in Net Retail Sales for
the Fiscal Year of Licensee in which such Charged Off Receivable is collected.
For purposes of clarification, Net Retail Sales shall include all revenues
generated from (x) the sale in the Facilities or the Internet Store (including
through any New Sales Medium) of any goods, products, merchandise, services or
other items sourced from other licensees of TDSF or its Affiliates even if such
other licensees also are required to pay a royalty to TDSF or its Affiliates
with respect thereto and (y) the sale in the Facilities, the Internet Store
(including through any New Sales Medium) or otherwise of goods, products,
merchandise, services or other items to employees of Licensee or TDSF or any of
their respective Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.1.2 <U>Royalty for
Non-Core Stores</U>. Notwithstanding anything to the contrary contained in
Section 7.1.1, with respect to each Non-Core Store, (i) until the later to occur
of (a) the expiration of the Original Lease Term for such Non-Core Store, (b)
the early termination of the Lease Agreement for such Non-Core Store and (c) the
second (2<FONT SIZE=1>nd</FONT>) anniversary of the Effective Date (such period, the
<B>"Initial Non-Core Stores Abatement Period"</B>), no Monthly
Facilities Royalty Amount shall be payable with respect to Net Retail Sales from
such Non-Core Store; (ii) following the Initial Non-Core Stores Abatement Period
with respect to any Non-Core Store, if such Non-Core Store continues to be
operated by Licensee as a Facility hereunder (whether under an amended or new
Lease Agreement, on a month-to-month basis or otherwise), either (a) the Monthly
Facilities Royalty Amount payable with respect to such Non-Core Store shall be
equal to two and one-half percent (2.5%) of all Net Retail Sales therein (rather
than five percent (5%) of all Net Retail Sales therein, as provided under
Section 7.1.1) for a period of two (2) years following the Initial Non-Core
Stores Abatement Period, if FY04 Cash Contribution equals Eight Million Dollars
($8,000,000) or more, (b) no Monthly Facilities Royalty Amount shall be payable
with respect to Net Retail Sales from such Non-Core Store for a period of three
(3) years following the Initial Non-Core Stores Abatement Period, if FY04 Cash
Contribution equals at least Four Million Dollars ($4,000,000) but less than
Eight Million Dollars ($8,000,000), (c) no Monthly Facilities Royalty Amount
shall be payable with respect to Net Retail Sales from such Non-Core Store for a
period of four (4) years following the Initial Non-Core Stores Abatement Period,
if FY04 Cash Contribution equals at least Two Million Dollars ($2,000,000) but
less than Four Million Dollars ($4,000,000), or (d) no Monthly Facilities
Royalty Amount shall be payable with respect to Net Retail Sales from such
Non-Core Store for a period of five (5) years following the Initial Non-Core
Stores Abatement Period, if FY04 Cash Contribution equals less than Two Million
Dollars ($2,000,000); and (iii) following the Initial Non-Core Stores Abatement
Period and the applicable period referenced in subparagraph (ii) of this Section
7.1.2, such Non-Core Store shall be treated the same as all other Facilities
under Section 7.1.1 for purposes of the Monthly Facilities Royalty Amount
payable on Net Retail Sales therein. For purposes of clarification, in the event
that any Non-Core Store is closed and a new Facility is opened in the same
Shopping Mall, Select Street Location or Qualifying Strip Center as the closed
Non-Core Store, such new Facility shall not be deemed to be a Non-Core Store for
purposes of determining Licensee&#146;s royalty obligations pursuant to this
Section 7. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.1.3 <U>Facilities Royalty
Abatement</U>. Notwithstanding anything to the contrary contained in Section
7.1.1, no Monthly Facilities Royalty Amount shall be required to be paid or owed
by Licensee to TDSF on any Net Retail Sales generated at the Facilities during
the period starting on the Effective Date and ending on the second
(2<FONT SIZE=1>nd</FONT>) anniversary of the Effective Date. The royalty abatement
contemplated by this Section 7.1.3 (i) shall be deemed to run concurrently with
the royalty abatement and/or reduction period for Non-Core Stores contemplated
by Section 7.1.2 and (ii) shall not under any circumstances be deemed to apply
to Net Retail Sales arising from or through the Internet Store, with respect to
which Net Retail Sales the royalty obligations set forth in this Section 7 shall
commence immediately upon the Internet Start Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.2 <U>Guarantee</U>.
Commencing with the third (3<FONT SIZE=1>rd</FONT>) Contract Year and for each Contract
Year thereafter, if the Contract Year Royalty Amount for such Contract Year is
less than the Guarantee Amount for such Contract Year, Licensee shall pay an
amount equal to such shortfall in one lump sum cash payment to TDSF within two
(2) months following the end of such Contract Year. For purposes of this
Agreement, (i) the <B>"Contract Year Royalty Amount" </B>shall mean
the aggregate amount of Monthly Facilities Royalty Amounts due by Licensee to
TDSF with respect to any Contract Year; (ii) the <B>"Guarantee
Amount"</B> shall mean an amount equal to the greater of (a) sixty percent
(60%) of the Floor Guarantee and (b)&#160;eighty percent (80%) of the Average
Royalty Amount; (iii) the <B>"Average Royalty Amount"</B> shall mean
the average of the Contract Year Royalty Amounts for the two (2) Contract Years
immediately preceding the Contract Year for which the Guarantee Amount is being
calculated; and (iv) the <B>"Floor Guarantee" </B>shall mean (x) for
the third (3<FONT SIZE=1>rd</FONT>) Contract Year, an amount equal to the Contract Year
Royalty Amount that would have been payable under this Agreement for the twelve
(12) month period ending October&#160;2, 2004 if this Agreement had been in
effect during such period with respect to the Facilities subject to this
Agreement, as calculated in good faith by TDSF, and (y) for each Contract Year
following the third (3<FONT SIZE=1>rd</FONT>) Contract Year, the amount calculated under
the preceding subparagraph (x) increased at an annual compound rate equal to the
increase, if any, in the CPI during each such Contract Year calculated in
accordance with the CPI Adjustment Methodology; <U>provided</U>, that, in
calculating the Average Royalty Amount and the Floor Guarantee, (1) Section
7.1.3 shall be treated as if it were inapplicable at all times under this
Agreement and (2) Section 7.1.2 shall be treated as if it applied during any
period used in such calculations if and only to the extent it was applicable to
any Non-Core Store during the Contract Year for which the Guarantee Amount is
being calculated (and, accordingly, the Floor Guarantee and the Average Royalty
Amount may increase as and to the extent Non-Core Stores become subject to
royalty obligations in accordance with Section 7.1.2). Licensee shall not be
entitled to any credit or offset against its obligations as to the Guarantee
Amount under this Section 7.2 in any Contract Year in the event that the
Contract Year Royalty Amount in any other Contract Year exceeds the Guarantee
Amount for such Contract Year <U>(i.e.</U>, no "rollover" credit or
offset from one Contract Year to another). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.3 <U>Manner of
Payments</U>. All payments of Monthly Facilities Royalty Amounts, Monthly
Internet Store Royalty Amounts, Monthly Royalty Amounts, Guarantee Amounts and
any other payments due by Licensee to TDSF under this Section 7 (collectively,
<B>"Licensee Payments"</B>) shall be made by Licensee to TDSF via
federal wire transfer to an account designated by TDSF in writing. Licensee
shall be solely responsible for any applicable sales, use, withholding (imposed
by Canada or any other non-U.S. taxing jurisdiction), value-added or other
similar Taxes due on the Licensee Payments, regardless of whether such Taxes
must be collected by TDSF, and for any other Taxes arising in connection with
this Agreement; <U>provided</U>, that TDSF shall be solely responsible for any
local, state, provincial or federal income Taxes (or franchise, gross receipts
or other similar Taxes imposed in lieu of net income Taxes), other than
withholding Taxes imposed by Canada or any other non-U.S. taxing jurisdiction,
payable by TDSF or its Affiliates on, or in respect of, the Licensee Payments.
In addition, each Licensee Payment shall be accompanied by documentation in a
form and manner reasonably satisfactory to TDSF and Licensee supporting the
amount of such Licensee Payment. Upon TDSF&#146;s request, Licensee shall
promptly provide TDSF with such additional information or documentation as TDSF
may reasonably require in connection with its review and analysis of any
Licensee Payment. For purposes of clarification, nothing contained in this
Section 7.3 is intended, as between the parties hereto, to alter the
responsibility of the parties to the Acquisition Agreement for the payment of
Taxes as and to the extent set forth in the Acquisition Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.4 <U>U.S. Dollars;
Exchange Rates</U>. All Licensee Payments are to be made in U.S. dollars. In the
event an exchange rate is necessary, Licensee shall use the official exchange
rate as published in the Wall Street Journal, New York Edition, on the last
Business Day of the applicable Retail Month, and Licensee shall identify such
exchange rate on the applicable documentation provided to TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.5 <U>Termination of
Agreement</U>. In the event that this Agreement is terminated early by TDSF
pursuant to Section&#160;13, without prejudice to any other right or remedy
available to TDSF in the event of such termination, in addition to paying in
full and in a timely manner any Guarantee Amount for the Contract Year
immediately preceding the Contract Year that contains the date of such
termination, Licensee shall, within two (2) months following the effective date
of such termination, pay to TDSF in one lump sum cash payment the amount (if
any) by which (i)&#160;an amount equal to (a)&#160;the Guarantee Amount for the
Contract Year in which such termination occurs, <U>multiplied&#160;by</U>
(b)&#160;a fraction, the numerator of which is the number of days during such
Contract Year through and including the effective date of such termination and
the denominator of which is three hundred sixty-five (365),
<I><U>exceeds</U></I><U></U> (ii)&#160;the aggregate amount of Monthly Royalty
Amounts paid by Licensee to TDSF in respect of the Contract Year in which such
termination occurs through and including the date of termination. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.6 <U>TDS Canada and Canadian Royalties</U>. TDSF and Licensee acknowledge and
agree that (i) notwithstanding anything to the contrary contained in this
Agreement, under no circumstances shall TDS Canada be liable for the payment of
any Monthly Royalty Amount that is attributable to TDS USA&#146;s use of the
Licensed Materials or any payments in respect of the Guarantee Amount (provided
that, for purposes of clarification, TDS USA shall remain liable for the full
amount of all Licensee Payments hereunder, including, without limitation, those
arising from TDS Canada&#146;s use of the Licensed Materials), (ii) the Monthly
Facilities Royalty Amount that is attributable to Net Retail Sales generated by
the Facilities located in Canada is allocable ninety-five percent (95%) to the
production or reproduction of Licensed Materials consisting of copyrighted
Licensed Materials and five percent (5%) to Licensed Materials consisting of
trademarks, and (iii) the Monthly Royalty Amount that is attributable to TDS
Canada&#146;s use of the Licensed Materials shall at all times be payable to an
Entity that is considered resident of the United States under Article IV of the
Canada-United States Tax Treaty and that is entitled to all benefits thereunder.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.7 <U>TDS USA
Royalties</U>. TDSF and Licensee acknowledge and agree that the Monthly Royalty
Amount that is attributable to TDS USA&#146;s use of the Licensed Materials and
any payment in respect of the Guaranteed Amount (i) shall at all times be
payable to an entity that, for United States tax purposes, is either a United
States corporation, a United States partnership or an entity one hundred percent
of the interests in which are owned by either a United States corporation or a
United States partnership and (ii) is allocable ninety-five percent (95%) to the
production or reproduction of Licensed Materials consisting of copyrighted
Licensed Materials and five percent (5%) to Licensed Materials consisting of
trademarks. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.8 <U>Use of Payments</U>.
Licensee understands and agrees that neither TDSF nor any of its Affiliates
shall have any obligation whatsoever to account to Licensee for the use or
application of any of the Licensee Payments, and TDSF and its Affiliates may use
all such Licensee Payments for any purpose whatsoever as solely determined by
TDSF or any of its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
7.9 <U>No Third Party
Royalty Payments</U>. TDSF acknowledges and agrees that, subject to any
provision of this Agreement that expressly requires the payment of a royalty or
license fee to a third party, including, without limitation, Sections 4.6 and
4.7, and other than (x) the Licensee Payments and (y) any other amounts due to
TDSF or its Affiliates under this Agreement (including, without limitation,
indemnification obligations of Licensee pursuant to Section 12.1), Licensee
shall have no obligation to pay any royalties or license fees to any other
Person as a result of Licensee&#146;s use of the Disney Properties pursuant to
and in strict accordance with the terms of this Agreement. </FONT></P>

<P><FONT SIZE=3>8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>OVERSIGHT OF RELATIONSHIP</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.1 <U>TDSF Advisors</U>.
During the Term, TDSF will designate one (1) or more full-time employees of TDSF
and/or its Affiliates having an appropriate level of seniority as determined by
TDSF in its business judgment (the <B>"TDSF Advisors"</B>) (such
number to be determined by TDSF in its sole discretion from time to time), whose
responsibilities will include, in addition to any responsibilities such
employees might have that are not related to this Agreement, (i) internally
managing and supervising the overall relationship between TDSF and Licensee as
contemplated by this Agreement, (ii) coordinating TDSF&#146;s review of approval
requests from Licensee, including, without limitation, requests pursuant to
Section&#160;5 and Section&#160;9 and such other requests as Licensee may make
from time to time in accordance with this Agreement (collectively,
<B>"Approval Requests"</B>), and (iii) assisting Licensee with any
problems that may arise, or any complaints that Licensee may have, in connection
with TDSF&#146;s review of Approval Requests or other issues arising under this
Agreement. TDSF shall designate one (1) senior TDSF Advisor as the
"relationship manager" with respect to the relationship between
Licensee and TDSF hereunder. TDSF, in its sole discretion, may change from time
to time which of its employees are designated as TDSF Advisors and as the
"relationship manager," <U>provided</U>, that TDSF shall notify
Licensee of such change. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.2 <U>Licensee
Advisors</U>. During the Term, Licensee will designate a certain number of
full-time employees of Licensee, Licensee Parent, Canadian Parent and/or TCP
having an appropriate level of seniority as determined by Licensee in its
business judgment (the <B>"Licensee Advisors"</B>) (such number to be
determined by Licensee in its sole discretion from time to time), whose primary
responsibilities will include (i) internally managing and supervising the
overall relationship between TDSF and Licensee as contemplated by this
Agreement, (ii)&#160;coordinating Licensee&#146;s submission of Approval
Requests to TDSF, and (iii) otherwise exercising Licensee&#146;s rights under
this Agreement. Licensee shall designate a senior Licensee Advisor as the
"relationship manager" with respect to the relationship between
Licensee and TDSF hereunder. Licensee, in its sole discretion, may change from
time to time which of its employees are designated as Licensee Advisors and as
the "relationship manager," <U>provided</U>, that Licensee shall
notify TDSF of such change. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.3 <U>Joint Advisory
Committee</U>. Each of TDSF and Licensee shall designate three (3) TDSF Advisors
and three (3) Licensee Advisors, respectively, each of which shall be a senior
officer of TDSF or TWDC, on the one hand, or Licensee, Licensee Parent, Canadian
Parent or TCP, on the other hand, to participate in a joint advisory committee
under this Agreement (the <B>"Joint Advisory Committee"</B>). The
Joint Advisory Committee will meet at least once per Fiscal Quarter of Licensee
during each Contract Year to discuss, and advise the parties hereto on, overall
matters pertaining to the Business and its performance. Meetings may occur by
telephone conference or in person, <U>provided</U>, that, if meetings are
conducted in person, the location shall alternate between the corporate
headquarters of TDSF and Licensee, unless otherwise mutually agreed. The Joint
Advisory Committee may establish subcommittees or working groups from time to
time in its discretion to address specific issues. In addition to such other
matters as may come before it, the Joint Advisory Committee shall discuss and
advise the parties on the following: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.3.1 The Annual Business
Plan prepared by Licensee in accordance with Section&#160;9.2, together with
rolling three-year projections and budgets for the Business for each Contract
Year, shall be prepared by Licensee in consultation with TDSF at least four (4)
Retail Months prior to the commencement of each Contract Year (or, in the case
of the first (1<FONT SIZE=1>st</FONT>) Contract Year, within four (4) Retail Months
following the Effective Date); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.3.2 The Quarterly
Merchandise Plan prepared by Licensee in accordance with Section 9.6.1, which
shall be prepared by Licensee in consultation with TDSF at least one (1) Retail
Month prior to the commencement of each Fiscal Quarter of Licensee (or, in the
case of the first (1st) Fiscal Quarter following the Effective Date, within one
(1) Retail Month following the Effective Date); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.3.3 The marketing plan
for each Fiscal Quarter of Licensee, including marketing, advertising and
promotional activities contemplated by Licensee to be conducted within the
Facilities (<U>e.g.</U>, window design, store displays), the Internet Store and
in all other marketing channels, which shall be prepared by Licensee in
consultation with TDSF at least one (1) Retail Month prior to the commencement
of each Fiscal Quarter of Licensee (or, in the case of the first
(1<FONT SIZE=1>st</FONT>) Fiscal Quarter, within one (1) Retail Month following the
Effective Date); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.3.4 (i)&#160;Operating
results of the Business on a consolidated basis, including financial statements
that have been prepared in accordance with GAAP and delivered by Licensee to
TDSF under Section&#160;9.11, (ii) operational matters related to the Facilities
and the Internet Store, (iii) customer satisfaction surveys and survey results
to the extent conducted by Licensee in its sole discretion, and (iv) such other
matters that may arise from time to time in connection with this Agreement or
the Business; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.3.5 A presentation by
TDSF to Licensee setting forth information pertaining to future business
marketing plans and promotional initiatives of TDSF and its Affiliates that are
likely to result in the development of additional Disney Properties for use by
Licensee hereunder or other merchandising or promotional opportunities
(including new opportunities for use of existing Disney Properties) for Licensee
hereunder, including, as applicable, information pertaining to the motion
picture, television and Theme Park businesses of TDSF and its Affiliates, new
strategic alliances, and character properties that may be designated as
Disney-Branded Properties or Non-Disney-Branded Properties. Notwithstanding the
foregoing, TDSF shall not be required to disclose to Licensee any information
that it is or may be (as determined by TDSF in its business judgment) prohibited
from disclosing pursuant to any Contract binding on TDSF or its Affiliates or
any of their properties, applicable Law or the rules and regulations of any
stock exchange on which TDSF&#146;s or any of its Affiliates&#146; Securities
are traded; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
8.3.6 Procedures for the
submission and review of Approval Requests (in connection therewith, if TDSF
either repeatedly fails to grant its approval of Approval Requests or repeatedly
fails to respond to Licensee in granting or denying its approval of Approval
Requests within the time periods specified herein, and such repeated failures to
respond materially impair the ability of Licensee to operate the Business in
accordance with the applicable Annual Business Plan, then, upon the written
request of Licensee, the Joint Advisory Committee shall promptly conduct a
special meeting at which it shall review the process for the submission and
review of Approval Requests under this Agreement and shall make recommendations
regarding the resolution of such issues to the senior executive management of
each of TWDC and Licensee, who shall consider such recommendations in good faith
and shall promptly implement or cause to be implemented those recommendations
that they consider appropriate in their respective business judgment and not
inconsistent with the terms of this Agreement). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Notwithstanding anything to the contrary contained herein, the Joint Advisory
Committee shall act solely in an advisory capacity in a manner designed to
foster mutual cooperation between the parties in connection with this Agreement
and in order to promote the Business, but none of the activities of the Joint
Advisory Committee nor any purported approval of any matter by the Joint
Advisory Committee shall limit or restrict in any manner whatsoever the approval
rights of TDSF as contained in this Agreement nor be deemed to constitute an
approval by TDSF pursuant to this Agreement, in each case including, without
limitation, under Sections 5 and 9, nor be deemed to establish a course of
conduct of the parties hereunder, nor otherwise be deemed to amend or modify in
any manner any of the terms of this Agreement. </FONT></P>

<P><FONT SIZE=3>9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>OPERATION OF THE FACILITIES AND THE INTERNET STORE</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Licensee
shall at all times operate the Business and each of the Facilities and the
Internet Store strictly in accordance with the terms and conditions set forth in
this Agreement (including, without limitation, the Schedules hereto and the
matters set forth in this Section 9), any authorizations, waivers or consents
given by TDSF from time to time in accordance herewith, the rules, regulations,
standards, policies, procedures and guidelines of TDSF and its Affiliates as set
forth in the Operating Manual, and any other guidelines as TDSF and Licensee may
agree upon from time to time in their respective sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.1      <U>General Operating Standards</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.1.1 <U>Operation Through
Facilities and Internet Store</U>. During the Term, Licensee shall not operate
the Business or offer or sell goods, products, merchandise, services or other
items to consumers through any store, facility, location, venue, methodology or
channel of distribution other than the Facilities and the Internet Store.
Without limiting the foregoing, Licensee acknowledges and agrees that Licensee
shall not offer or sell goods, products, merchandise, services or other items
through any sales medium that was not used in the Facilities or the Internet
Store immediately prior to the Effective Date, including, without limitation,
vending machines, photocapture systems and/or computers, without the prior
written approval of TDSF (as determined by TDSF in its sole discretion), which
approval shall be sought in accordance with the approval provisions set forth in
Section 9.19.3. Any such new sales medium approved by TDSF in accordance with
the terms hereof is referred to herein as a <B>"New Sales
Medium</B>.<B>"</B> </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.1.2 <U>Maximizing Value
of the Business</U>. Licensee shall at all times operate the Business and make
business decisions with a view toward maximizing its standalone value as a
retail operation. Without limiting the generality of the foregoing, Licensee
agrees that (a)&#160;the Business, the Facilities and the Internet Store shall
not be operated primarily as a promotional vehicle for other businesses or
interests of Licensee or any of its Affiliates and (b)&#160;Licensee shall, and
shall cause its Affiliates to, protect the business and financial interests of
Licensee and the Business and, to that end, Licensee (i) shall not, and shall
not permit its Affiliates to, take any action that is intended to favor
Licensee&#146;s Affiliates or any third party to the detriment of Licensee, and
(ii) shall ensure that all transactions by Licensee or any of its Affiliates
(including, without limitation, transactions between Licensee and any of its
Affiliates, lease negotiations and other transactions with third parties) that
are directly or indirectly related to, or that would reasonably be expected to
have a direct or indirect impact on, Licensee and/or the Business shall be
conducted at all times on an arm&#146;s length, commercially reasonable basis
and on terms and conditions that are not intended to favor Licensee&#146;s
Affiliates or any third party to the detriment of, or in a manner that would
have a negative impact on, Licensee. For purposes of the preceding sentence,
TDSF and Licensee acknowledge and agree that any action, term or condition that
is expressly required or authorized pursuant to this Agreement shall not be
deemed to be intended to favor Licensee&#146;s Affiliates or any third party to
the detriment of Licensee. In connection with carrying out Licensee&#146;s
obligations hereunder and the exercise of Licensee&#146;s rights hereunder,
Licensee shall protect the image, reputation, brand, appearance and quality of,
and goodwill associated with, TDSF and its Affiliates, the businesses,
properties and products of TDSF and its Affiliates, the Disney Properties, and
any other names, brands, trademarks, logos, symbols, characters or other
proprietary designations or intellectual property of TDSF and its Affiliates,
and shall maintain the reputation of the Facilities, the Internet Store and the
Business as a high quality retail operation by offering high quality Disney
Merchandise at good value and an entertaining shopping experience in quality
locations. Licensee shall not, and shall not permit any of its Affiliates to,
take any action or engage in any conduct, activity or practice that is
inappropriate or injurious to, or inconsistent with, the image, reputation,
brand, appearance and quality of, or that may impair the goodwill associated
with, TDSF and its Affiliates, the businesses, properties or products of TDSF
and its Affiliates, the Disney Properties, or any other names, brands,
trademarks, logos, symbols, characters or other proprietary designations or
intellectual property of TDSF and its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.1.3 <U>Operation By
Licensee</U>. During the Term, other than as expressly provided herein and other
than pursuant to and in accordance with the TCP Intercompany Services Agreement
or as TDSF may approve in writing in its sole discretion, Licensee shall not
cause or permit the Business, the Facilities, the Internet Store or any material
assets relating to or used in connection therewith (including, without
limitation, any Business Properties, Lease Agreements, material personal
property and leases with respect thereto, material Contracts and intellectual
property rights) to be owned, leased, licensed, controlled and/or operated by
any Person (including, without limitation, any subcontractor or agent) other
than TDS USA and TDS Canada. In addition, during the Term, unless TDSF shall
otherwise consent in writing in its sole discretion, Licensee shall cause the
Business conducted within the United States and its territories and possessions
to be owned, leased, licensed, controlled and operated by TDS USA and the
Business conducted within Canada to be owned, leased, licensed, controlled and
operated by TDS Canada. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.1.4 <U>No Other
Operations</U>. Neither Licensee nor any of its Subsidiaries shall, whether
directly or indirectly, own, lease, license, control, maintain, manage, staff,
supply, administer, market, advertise, promote, operate or otherwise engage in
any manner in any business or activity or asset other than the Business, and
Licensee Parent and Canadian Parent shall have no business, assets or operations
other than solely holding the equity interests in TDS USA and TDS Canada,
respectively. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.2 <U>Annual Business
Plans</U>. At least three (3) Retail Months prior to the beginning of each
Contract Year, Licensee shall prepare and submit to TDSF an annual budget and
business plan (the <B>"Annual Business Plan"</B>) for the Business for
the upcoming Contract Year (except that the Annual Business Plan for the first
(1<FONT SIZE=1>st</FONT>) Contract Year shall be prepared and submitted within four (4)
Retail Months after the Effective Date). The Annual Business Plan shall take
into account and reflect, among other things, projected revenues, expenses,
profitability and Licensee Payments for the upcoming Contract Year and shall
include a plan for the application of capital expenditures for maintaining and
refurbishing the Facilities. Licensee shall consult with TDSF regarding the
Annual Business Plan and shall consider in good faith TDSF&#146;s comments and
suggestions with respect thereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.3 <U>Opening and Closing Business Properties; Maintenance and Refurbishment of
Facilities</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.3.1 <U>Initial
Facilities; Opening and Closing Facilities</U>. As of the Effective Date, the
Store Facilities and Outlet Facilities subject to this Agreement are those
identified on <U>Schedule 9.3.1</U>, <U>provided</U> that such <U>Schedule
9.3.1</U> may be amended to add additional Store Facilities and/or Outlet
Facilities upon consummation of the Subsequent Closing. From time to time during
the Term, subject to the provisions of this Agreement, including, without
limitation, Sections&#160;9.3.1, 9.3.2(a), 9.3.3, 9.7.1(e) and 9.19, Licensee
may open and operate additional Facilities and may, subject to the provisions of
this Agreement, including, without limitation, Sections&#160;9.3.1, 9.3.2(a),
9.3.4 and 9.19, close and cease operations at any Facilities. Except as
otherwise provided in Sections&#160;9.3.1(a) and 9.3.1(b), each opening of a new
Facility and each closing of a Facility shall be subject in each instance to the
prior written approval of TDSF (such approval or disapproval determined by TDSF
in its sole discretion), which approval shall be sought in accordance with the
approval provisions set forth in Section 9.19.1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Permitted
Openings</U>. Subject to the provisions of Section 9.3.1(c) and Section 9.3.3,
Licensee shall be permitted to open Facilities at locations selected by Licensee
without seeking or obtaining TDSF's approval of such locations as follows
(collectively, the "<B>Permitted Openings</B>"): (i) during the Stub Period and the
first (1st) and second (2nd) Contract Years, Licensee shall be permitted to open
up to (but not more than) fifteen (15) Facilities in the aggregate at locations
selected by Licensee, provided, that (A) the aggregate number of such Facilities
opened by Licensee during the Stub Period and the first (1st) Contract Year
shall not exceed seven (7) and (B) the aggregate amount of liability under each
lease for each such Facility (consisting of base rent, percentage rent, common
area maintenance charges, taxes and other comparable payment obligations) during
the full term of such lease entered into during the Stub Period or the first
(1st) or second (2nd) Contract Year shall not exceed Five Million Dollars
($5,000,000) per lease with respect to more than ten (10) of such Facilities or
Seven Million Five Hundred Thousand Dollars ($7,500,000) with respect to any
lease for any such Facility; (ii) during each of the third (3rd), fourth (4th)
and fifth (5th) Contract Years, Licensee shall be permitted to open up to (but
not more than) ten percent (10%) of the number of Facilities operated by
Licensee on the first day of each such Contract Year at locations selected by
Licensee; and (iii) during the sixth (6th) Contract Year and each Contract Year
thereafter, Licensee shall be permitted to open up to (but not more than) twenty
percent (20%) of the number of Facilities operated by Licensee on the first day
of each such Contract Year at locations selected by Licensee; provided, that,
(I) in the event that Licensee opens fewer than fifteen (15) Facilities in the
aggregate during the Stub Period and the first (1st) and second (2nd) Contract
Years, the number of Facilities that Licensee shall be permitted to open at
locations selected by Licensee in the third (3rd) Contract Year shall be
increased by the number of Facilities equal to the difference between fifteen
(15) and the number of Facilities so opened during the Stub Period and the first
(1st) and second (2nd) Contract Years, and (II) in the event that Licensee does
not open the maximum number of Facilities permitted by subparagraph (ii) or
(iii) above in a particular Contract Year (the "<B>Permitted Openings Measurement
Year</B>"), the number of Facilities that Licensee shall be permitted to open at
locations selected by Licensee in the next Contract Year shall be increased by
the lesser of (x) the number of Facilities so permitted but not opened during
the Permitted Openings Measurement Year and (y) five percent (5%) of the number
of Facilities operated by Licensee on the first day of the Permitted Openings
Measurement Year. For purposes of clarification, the number of Permitted
Openings permitted by this Section 9.3.1(a) shall be in addition to (1) Lease
Extension Arrangements with respect to Facilities already operating during the
applicable Contract Year, and (2) replacements of any Facilities that are closed
during the applicable Contract Year (excluding replacements of Non-Core Stores
unless a new Facility replacing any such Non-Core Store shall be opened in the
same Shopping Mall, Select Street Location or Qualifying Strip Center as the
closed Non-Core Store). Thus, by way of example and not limitation, if, at the
beginning of the third (3rd) Contract Year, Licensee operated three hundred
(300) Facilities, and if, during such third (3rd) Contract Year, Licensee
entered into Lease Extension Arrangements to renew expiring Lease Agreements for
ten (10) of such Facilities and closed five (5) of such Facilities in accordance
with the terms of this Agreement, Licensee would be permitted to select the
locations at which to open five (5) new Facilities to replace the five (5)
closed Facilities plus thirty (30) additional locations pursuant to subparagraph
(ii) of this Section 9.3.1(a), in each case without seeking or obtaining TDSF's
approval of such locations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Permitted
Closings</U>. Subject to the provisions of Section 9.3.1(c) and Section 9.3.4,
Licensee shall be permitted, during each Contract Year, to close, at locations
selected by Licensee, (i) any Non-Core Store and (ii) up to (but not more than)
ten percent (10%) of the number of Facilities (excluding Non-Core Stores)
operated by Licensee on the first day of such Contract Year, in each case
without seeking or obtaining TDSF's approval of such locations (collectively,
the "<B>Permitted Closings</B>"), <U>provided</U>, that, (a) except with respect to a Non-Core
Store, each location at which Licensee has elected not to enter into a Lease
Extension Arrangement to renew or extend an expiring or terminating Lease
Agreement with respect to the Facility operating at such location shall be
counted as one (1) of the Permitted Closings permitted pursuant to this Section
9.3.1(b) (and, accordingly, Licensee acknowledges and agrees that, unless
otherwise consented to in writing by TDSF pursuant to the first paragraph of
this Section 9.3.1, during any Contract Year, Licensee shall not permit any
Lease Agreement with respect to any Facility to expire or terminate if, prior
thereto, Licensee has already used all of its Permitted Closings during any
Contract Year), and (b) under no circumstances shall Licensee close any Store
Facility or permit any Lease Agreement with respect to any Store Facility to
expire or terminate if fewer than one hundred fifty (150) Store Facilities would
be operated by Licensee following such closure, expiration or termination, such
number being the minimum number of Store Facilities that Licensee shall operate
at any time during the Term.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Restrictions
on Permitted Openings and Permitted Closings</U>. Notwithstanding Licensee's
right to open and close certain Facilities, at locations selected by Licensee,
pursuant to Sections 9.3.1(a) and 9.3.1(b), all of the other requirements set
forth in, and all other TDSF approvals required by, this Agreement with respect
to opening and closing Facilities, including, without limitation, Sections
9.3.2(a), 9.3.3, 9.3.4, 9.7.1(e) and 9.19, shall continue to apply with respect
to Permitted Openings and Permitted Closings. In addition, (i) unless otherwise
approved in writing by TDSF in its business judgment, (x) the location of any
Permitted Opening shall not, within the two (2) year period immediately prior to
such opening, have been occupied, licensed, franchised or operated by TCP or any
of its Affiliates, including, without limitation, being occupied, licensed,
franchised or operated as a "Children's Place" store, and (y) the location of
any Permitted Closing shall not, within the two (2) year period immediately
following such closing, be occupied, licensed, franchised or operated by TCP or
any of its Affiliates, including, without limitation, being occupied, licensed,
franchised or operated as a "Children's Place" store, and (ii) not later than
twenty (20) Business Days before any Permitted Opening or Permitted Closing,
Licensee shall provide to TDSF written notice thereof (the "<B>Permitted
Opening/Closing Notice</B>"), which Permitted Opening/Closing Notice shall include
(A) specific information with respect to the location of the Facility opened or
closed and (B) in the case of a Permitted Closing, a statement of procedures for
removing, or for barricading or blocking from public view, all Licensed
Materials, Disney Properties and other names, brands, trademarks, logos,
symbols, characters or other proprietary designations or intellectual property
of TDSF or any of its Affiliates located within or at such closed Facility (such
procedures for such barricading or blocking from public view, the "<B>Barricade
Procedures</B>") and a statement of procedures for winding down operations at such
closed Facility, including, without limitation, plans for asset and inventory
reallocation, clean up and exit from the premises, timely notification to
employees regarding closure of the Facility, public notification to customers
regarding closure of the Facility (which notification may include, among other
things, information as to product return procedures and alternative store
locations) (the "<B>Wind Down Procedures</B>"), <U>provided</U>, that, in the event that (I)
such Barricade Procedures are not satisfactory to TDSF as determined by TDSF in
its sole discretion or (II) such Barricade Procedures or Wind Down Procedures do
not comply with the Operating Manual, TDSF shall, within ten (10) Business Days
following the Permitted Opening/Closing Notice, provide to Licensee written
notice of its objections to such Barricade Procedures and/or Wind Down
Procedures (the "<B>Closing Procedures Objection Notice</B>"), which Closing Procedures
Objection Notice shall propose such modifications to such Barricade Procedures
and/or Wind Down Procedures as TDSF shall determine are necessary or appropriate
in its sole discretion, and Licensee shall promptly comply with all such
proposed modifications to such Barricade Procedures and/or Wind Down
Procedures.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.3.2    <U>Outlet Facilities; Internet Store; Other Operations</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) <U>Outlet Facilities</U>. At any time during the Term, within the Territory,
Licensee shall be entitled to own or lease and operate Outlet Facilities
representing, in the aggregate, no more than fifteen percent (15%) of the total
number of Facilities at any time. Licensee shall operate each Outlet Facility
under the name "<I>Disney Store Outlet</I>" or such other name as shall be approved by
each of TDSF and Licensee in its respective sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Internet
Store</U>. Commencing on the Internet Start Date and continuing during the
remainder of the Term, Licensee shall operate the Business through the Internet
Store and shall fully exercise its rights with respect to the TDS Internet
Domains, subject to the following limitations and restrictions:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) the Internet
Store shall be located on the World Wide Web at the TDS Internet Domains or such
other domain names or URLs as Licensee may request and TDSF may approve in its
sole discretion, but not at any other domain name or URL;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) the Internet
Store shall be operated on a full-retail pricing model (as opposed to on a
discount or warehouse pricing model or in a manner comparable to the Outlet
Facilities) (except for promotional and seasonal sales), each SKU of Disney
Merchandise shall be sold in the Internet Store at substantially the same price
at which such SKU of Disney Merchandise is or was, or is expected to be, sold in
the Store Facilities. The Internet Store shall not be operated as a method of
liquidating excess, obsolete or otherwise slow-moving inventories of Disney
Merchandise;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) throughout
the Term, the Internet Store shall be operated and available for access seven
(7) days per week, twenty-four (24) hours per day, except for reasonable periods
of downtime for scheduled maintenance and/or upgrades (including launching new
features) and for unforeseen power and/or internet outages, virus or hacker
attack, telecommunications line failure, communications provider strike,
terrorist act, act of war, other Force Majeure event or other technical
malfunctions; <U>provided</U>, that (1) Licensee shall use commercially reasonable
efforts to minimize the amount of any such downtime, (2) Licensee shall provide
TDSF with at least two (2) Business Days' advance written notice of routine
maintenance and/or upgrades and shall use commercially reasonable efforts to
perform such maintenance and/or upgrades at such times and in such manner as
will minimize disruptions to and downtime for the Internet Store (by, for
example and without limitation, performing such maintenance and/or upgrades
during low-traffic periods), and (3) in the event that any downtime is expected
to or does exceed five (5) consecutive Business Days, Licensee shall consult
with TDSF regarding methods for reducing such downtime and for addressing
customer service issues during such downtime and shall consider in good faith
TDSF's suggestions and recommendations in connection therewith;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) the Internet
Store shall not in any manner whatsoever be linked to, advertised on, promoted
by or otherwise associated in any manner with any other Person (besides Licensee
and TDSF and/or its Affiliates, as the case may be), website, domain name, URL
or Internet location without the prior written consent of TDSF, which may be
granted or denied by TDSF in its sole discretion, <U>provided</U>, that (i) Licensee
shall not be responsible for, nor be deemed to be in breach of this provision as
a result of, any unsolicited links to the Internet Store (except that Licensee
shall (x) remove any such unsolicited links that have been established by any
Affiliate of Licensee and (y) use its commercially reasonable efforts to remove
any such unsolicited link that Licensee becomes aware of and that is to a
website, domain name, URL or other Internet location that, as determined by TDSF
in its sole discretion, may be injurious to, adversely impact or be inconsistent
with the image, reputation, appearance or quality of, or the goodwill associated
with, the Disney Properties, the Licensed Materials or any other names, brands,
trademarks, logos, symbols, characters or other proprietary designations or
intellectual property of TDSF or its Affiliates); and (ii) Licensee may promote
and advertise the Internet Store using online advertisements and promotions
(i.e., pay for placement advertisements on search engines and portal websites),
subject, in each instance, to TDSF's written approval in its sole discretion
(which approval rights may be exercised by TDSF in order to, among other things,
prevent any violation of a Strategic Alliance Contract and prohibit Licensee
from using any "official" or "original" or comparable titles (<U>e.g.</U>, "Official
Site of the Disney Stores" or "Official Retailer of The Walt Disney Company" or
the "Original Disney Store Online"));</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (v) the goods,
products, merchandise, services or other items offered in the Internet Store
shall be shipped only to retail customers located within the Territory or on
United States military bases located outside of the Territory;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vi) Licensee shall
be solely responsible, at its cost, for all matters pertaining to the creation,
development, maintenance and operation of the Internet Store and the sale and
delivery of products through the Internet Store, including, without limitation,
(1) the design, development and production of all webpages for the Internet
Store (subject to the approval provisions of Section 5.2), (2) hosting all
portions of the Internet Store on its or third-party servers, providing all
required infrastructure (<U>i.e.</U>, telecommunications and connections to the
Internet), and installing, operating and maintaining all required website and
distribution center hardware, software, programming and other technology, (3)
all order fulfillment requirements, including, without limitation, inventory
management and warehousing, product distribution and shipping, transaction
processing, billing, collection, product returns, sales tax collection, customer
service, telephone inquiries, e-mail communications and other back-office
functions for the Internet Store, and (4) ensuring that the Internet Store and
all operations relating thereto comply with the requirements of applicable Law,
including, without limitation, privacy regulations and sales and use tax
regulations in each jurisdiction within the Territory;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vii) Licensee
acknowledges and agrees that none of TDSF or its Affiliates shall have any
obligation whatsoever to market, advertise or promote the Internet Store in any
manner whatsoever, including, without limitation, through any links, buttons,
tool bars or other navigation instruments or advertising on any Internet
operations or websites of, or any other properties owned, operated or controlled
by, or licensed to, TDSF or its Affiliates, and any such marketing, advertising
or promotion that TDSF or any of its Affiliates may agree to conduct shall be
the subject of a separate written agreement with separate consideration;
<U>provided</U>, that, (1) at any time during which TDSF or its Affiliates shall own,
operate or control, or have a license to, the Internet website located at
<U>www.disney.com</U> (or any replacement thereof or successor thereto during the
Term), TDSF shall, or shall cause its Affiliates to, display on such website, at
a location therein determined by TDSF or its Affiliates in their sole discretion
following consultation in good faith with Licensee (which location shall not be
on, but shall not be more than three (3) hyperlinks from, the home page of such
website), one or more webpages that feature a system whereby a customer may
request (via text input only) the address of a Facility within the Territory via
zip code (or comparable methodology mutually approved by Licensee and TDSF in
their respective business judgment, including search via "city" if and to the
extent the "store locator" technology located on or at the Internet Store
provides such a search mechanism), and the <U>www.disney.com</U> website will
communicate with the "store locator" technology located on or at the Internet
Store to produce the applicable Facility addresses (provided that (i) the
customer will at all times remain within the <U>www.disney.com</U> website and will not
be linked or transferred to the Internet Store or any other website and the
respective webpage(s) within the <U>www.disney.com</U> website will not contain any
link or navigation instrument enabling the customer to exit the <U>www.disney.com</U>
website (including, without limitation, links to any map service or comparable
website) and (ii) Licensee will be responsible at all times for all costs
associated with the telecommunications links between the Internet Store and the
<U>www.disney.com</U> website and with the creation, maintenance, hosting and operation
of the applicable "store locator" technology, any related databases and/or any
comparable replacement technology), and (2) at any time and from time to time
during the Term, TDSF shall have the right (but not the obligation), in its sole
discretion, to, or to cause its Affiliates to, provide a button, tool bar or
other navigation instrument creating a hyperlink from the home page of the
Internet website located at <U>www.disney.com</U> (or any replacement thereof or
successor thereto during the Term) to the Internet Store (the "<B>Hyperlink</B>"), with
the placement, size, location, prominence, design, technology and all other
elements of such navigation instrument to be determined by TDSF in its sole
discretion, <U>provided</U>, that TDSF shall be entitled to, or to cause its Affiliates
to, modify, remove, re-install and/or replace the Hyperlink at any time and from
time to time as determined by TDSF in its sole discretion;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (viii) other than
advertisements and other promotions for the Facilities and/or the Internet Store
(which advertisements may include, without limitation, advertisements and
promotions for Disney Merchandise) or as otherwise may be approved by TDSF in
its sole discretion, the Internet Store shall not contain, bear or feature any
marketing, advertising or promotional content, including, without limitation,
through any links, buttons, tool bars or other navigation instruments; <U>provided</U>,
that Licensee shall, within the Internet Store, provide a button, tool bar or
other navigation instrument creating a hyperlink from the Internet Store to the
Internet website located at <U>www.disney.com</U> or such website or other online
portion of the DDM Business of TDSF and its Affiliates as TDSF may designate in
its sole discretion following TDSF's consultation in good faith with Licensee
(<U>provided</U>, that, (1) if such designated website or other online portion of the
DDM Business consists of a website primarily focused on the retail sale of
Hardlines, Softlines and/or Toys/Plush, the designation thereof by TDSF shall be
subject to the approval of Licensee in its business judgment; and (2) if such
designated website or other online portion of the DDM Business consists of a
website primarily focused on the retail sale of Softlines bearing, featuring or
incorporating Disney-Branded Properties, the designation thereof by TDSF shall
be subject to the approval of Licensee in its sole discretion), with the
placement, size, location, prominence, design, technology and all other elements
of such navigation instrument to be determined by TDSF in its sole
discretion;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ix) the design,
appearance and "look and feel" of the Internet Store (including, without
limitation, all webpage templates of the Internet Store) shall be subject to
TDSF's written approval in its sole discretion in accordance with the approval
procedures set forth in Section 5; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (x) the Internet
Store shall be operated in accordance with additional guidelines to be mutually
agreed upon by TDSF and Licensee prior to the Internet Start Date, such approval
to be granted or denied in each party's respective business judgment (except as
to matters pertaining to the Licensed Materials, which shall be subject to the
approval of TDSF in its sole discretion and the approval of Licensee in its
business judgment).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Distribution
Centers</U>. During the Term, Licensee shall be entitled to own, lease and/or
otherwise operate such number of Distribution Centers within the Territory as
Licensee determines are reasonably necessary in connection with the operation of
the Business for purposes of shipping, receiving, storing, warehousing and
distributing goods, products and merchandise to, from and among the Facilities
and customers of the Internet Store.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.3.3 <U>Additional
Restrictions on Opening Facilities</U>. Licensee shall not open or operate any
new Facility that, at the time such Facility is opened, is located within (a) a
one-quarter (&#188;) mile radius of the El Capitan, or (b) a one-half (&#189;)
mile radius of the site of any TDSF Flagship Store or any Designated WDW Store.
In addition, Licensee shall not permit more than twenty percent (20%) of the
total number of Facilities open at any time to be located adjacent to any
location that is occupied, licensed, franchised or operated by TCP or any of its
Affiliates, including, without limitation, a location occupied, licensed,
franchised or operated as a "Children&#146;s Place" store (provided
that each separately branded chain that is occupied, licensed, franchised or
operated by TCP and/or its Affiliates (<U>e.g.</U>, The Children&#146;s Place
and any other retail chain that TCP and/or its Affiliates may operate in the
future under a different brand name) shall be considered separately in
determining whether such twenty percent (20%) threshold has been met with
respect to each such chain). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.3.4 <U>Additional
Restrictions on Closings</U>. Without limiting the restrictions on Permitted
Closings set forth in Section&#160;9.3.1(b) or TDSF&#146;s approval rights
pursuant to Sections 9.3.1 and 9.19.1, Licensee shall continuously operate each
Facility until expiration of the Lease Agreement relating thereto or associated
therewith, unless earlier cessation of operations at a particular Facility is
(a) not in violation of any of the terms of this Agreement and either (i) TDSF
has approved in writing in its business judgment the manner in which the related
Lease Agreement is terminated or (ii) the respective Landlord under the related
Lease Agreement has (x) consented to the early termination thereof, (y) to the
extent TDSF or its Affiliates have any obligations under the related Lease
Agreement, under applicable Law or under Contract as determined by TDSF in its
sole discretion, executed a full and final release of TDSF and its Affiliates
from any and all obligations with respect to the applicable Facility, the
related Lease Agreement, the cessation of operations at such Facility and the
termination of such related Lease Agreement, and (z) not assessed against
Licensee or any of its Affiliates, or otherwise required payment by Licensee or
any of its Affiliates of, any fees, penalties, expenses or other charges or
payments in excess of an amount equal to the tenant&#146;s aggregate liability
under such related Lease Agreement (consisting of base rent, percentage rent,
common area maintenance charges, taxes and other comparable payment obligations)
for one (1) year in connection with such cessation of operations and such
termination of such related Lease Agreement, (b) authorized or required pursuant
to the terms of the related Lease Agreement (without payment by Licensee or any
of its Affiliates of any fees, penalties, expenses or other charges or payments
in excess of an amount equal to the tenant&#146;s aggregate liability under such
related Lease Agreement (consisting of base rent, percentage rent, common area
maintenance charges, taxes and other comparable payment obligations) for one (1)
year), or (c) approved in writing by TDSF in its sole discretion. In connection
with the cessation of operations at any Facility (including in the case of a
Permitted Closing), Licensee shall (A) either remove all Licensed Materials,
Disney Properties and other names, brands, trademarks, logos, symbols,
characters or other proprietary designations or intellectual property of TDSF or
any of its Affiliates located within or at such closed Facility or comply with
Barricade Procedures that are satisfactory to TDSF in its sole discretion and
(B) comply with the Operating Manual (including, without limitation, any
guidelines with respect to Barricade Procedures, Wind Down Procedures, lease
termination and other matters related to winding down operations at the
Facility). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.3.5    <U>Maintenance and Refurbishment</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a)<U> Maintenance</U>.
Licensee shall maintain the quality, appearance and presentation standards of
the Facilities in accordance with the Operating Manual. Without limiting the
foregoing, Licensee shall at all times clean, maintain and keep in good repair
the entirety of the Facilities, including the furniture, fixtures and equipment,
tenant improvements, shelving, appliances, lighting, signage and other physical
attributes thereof, in accordance with the highest standards prevailing in the
specialty retail industry.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Facility
Refurbishment</U>. In addition to its maintenance obligations pursuant to Section
9.3.5(a), Licensee shall be required to maintain the quality, appearance and
presentation standards of the Facilities by completing Refurbishments in
accordance with the Annual Business Plans contemplated by Section 9.2 and as
approved in writing by TDSF in its sole discretion pursuant to Section 9.19.2
(except to the extent that certain Facility Design Elements are subject to
TDSF's approval in its business judgment as set forth in Section 9.3.6(a)). As
used herein, "<B>Refurbishments</B>" shall mean major remodels of Facilities involving
refurbishment of the entire Facility and substantially all its contents. In
furtherance of its obligations under this Section 9.3.5(b), Licensee shall (i)
before January 1, 2008, (a) complete a Refurbishment of at least ninety percent
(90%) of Core Stores (x) that have Lease Agreements with Original Lease Terms
expiring prior to January 1, 2008 and (y) that, upon expiration of the Original
Lease Term of the related Lease Agreement, are renewed or extended pursuant to
Long-Term Leases (whether by amendment, replacement, exercise of an option to
extend or otherwise), and (b) open, or complete Refurbishments of, at least one
hundred twenty (120) new or existing Store Facilities (the Refurbishment of such
Core Stores and the opening or Refurbishment of such Store Facilities as
described in the preceding subparagraphs (i)(a) and (i)(b), the "<B>Initial Minimum
Refurbishment Commitment</B>"), <U>provided</U>, that the parties agree that each
Refurbishment completed pursuant to subparagraph (i)(a) shall count as a
Refurbishment for purposes of subparagraph (i)(b), and (ii) during the Term,
complete a Refurbishment of each Facility in accordance with the following: (A)
with respect to each Facility as to which, following the expiration or
termination of the initial term of the related Lease Agreement (without regard
to any renewal, month-to-month tenancy, option exercise or other extension
thereof), such related Lease Agreement is renewed or the term thereof is
otherwise extended pursuant to a Long-Term Lease (whether by amendment,
replacement, exercise of an option to extend or otherwise), Licensee shall
complete a Refurbishment no later than twelve (12) months (or, in the case of
any such renewal or extension completed prior to the end of the third (3rd)
Contract Year, no later than eighteen (18) months) following the date of
expiration or earlier termination of the initial term of such related Lease
Agreement (without regard to any renewal, month-to-month tenancy, option
exercise or other extension thereof), whether such new Long-Term Lease is
consummated before or after such expiration or earlier termination (provided
that the requirement of this Subparagraph (A) shall not apply to any Non-Core
Store that is leased pursuant to a Disney Extended Non-Core Store Lease
Agreement unless and until such Disney Extended Non-Core Store Lease Agreement
is renewed or the term thereof is otherwise extended pursuant to a Long-Term
Lease that does not constitute a Disney Extended Non-Core Store Lease Agreement
(whether by amendment, replacement, exercise of an option to extend or
otherwise)), and (B) if a Refurbishment has not been completed earlier with
respect to any Facility pursuant to the preceding subparagraph (ii)(A), Licensee
shall complete a Refurbishment of each Facility at least once every twelve (12)
years (taking into account, for this purpose, the length of time a Facility was
operated prior to the Effective Date). During the last three (3) Contract Years
of the Initial Term or any Renewal Term, if the Term has not been renewed
pursuant to Section 2.2 prior to the beginning of any such three (3) Contract
Year period, Licensee's Refurbishment obligation hereunder shall continue but
Licensee shall not be required to spend more than two hundred fifty thousand
dollars ($250,000) (such amount to be adjusted each year beginning with the
second Contract Year by the CPI in accordance with the CPI Adjustment
Methodology) on the Refurbishment of any single Facility.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.3.6    <U>Look and Feel</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Approval of
Facility Design Elements</U>. All aspects of the design and appearance of the
Facilities (the "<B>Facility Design Elements</B>"), including, without limitation, (i)
the store design layout (including the layout of Licensed Materials, Disney
Properties and other intellectual property of TDSF or any of its Affiliates),
(ii) carpeting and flooring, (iii) furniture, fixtures and equipment, (iv)
shelving, (v) appliances, (vi) lighting, (vii) color scheme, (viii) decor, (ix)
signage, (x) displays, (xi) cut-outs, (xii) window strips, (xiii) multimedia,
(xiv) check-out counters and registers, (xv) packages, bags, gift wrap and
similar items, and (xvi) all other physical attributes of the Facilities, shall
be subject to TDSF's written approval in its sole discretion; provided, that (A)
the size of the Facilities (in square feet), the location of the check-out
counters and registers in the Facilities and the layout of shelving and other
furniture, fixtures and equipment in the Facilities shall be subject to TDSF's
written approval in its business judgment and (B) the design of the stock rooms
located in the Facilities shall not be subject to TDSF's approval so long as
such design is not, inconsistent with or inappropriate for the "Disney" image,
reputation and brand in any material respect. Any approval required pursuant to
this Section 9.3.6(a) shall be sought in accordance with the approval provisions
set forth in Section 9.19.2.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Ownership of
Facility Design Elements</U>. As between TDSF and Licensee, subject to the rights of
any licensors or other third parties, TDSF shall be, and be deemed to be, the
sole and exclusive owner of all rights with respect to the trade dress of the
Facilities and all Facility Design Elements therein and all such rights are
reserved to TDSF. Licensee shall neither acquire nor assert any rights in or to
such trade dress or Facility Design Elements and, without limiting the
foregoing, Licensee hereby assigns to TDSF all rights created by its use of such
trade dress and/or Facility Design Elements, together with the goodwill
attaching to that part of Licensee's business in connection with which such
trade dress and/or Facility Design Elements are used. Nothing in this Section
9.3.6(b) shall be deemed to limit the rights granted to Licensee pursuant to
Section 4.1, which entitle Licensee to use such trade dress and/or Facility
Design Elements in the Facilities during the Term, subject to and in accordance
with the terms of this Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.3.7 <U>Days and
Hours</U>. The days and hours of operation for any Facility shall comply with
the Operating Manual; <U>provided</U>, that the parties hereby acknowledge and
agree that operating days and hours may be subject to applicable Law, the rules
of a Facility&#146;s Landlord, the rules and policies of the developer of the
development in which a Facility is located, and other similar rules and
regulations (<U>e.g.</U>, rules of a tenant association). In the event that any
such rules, policies or regulations to which a Facility may be subject are
inconsistent with the Operating Manual, Licensee shall consult with TDSF
regarding such inconsistency and Licensee and TDSF shall cooperate to determine
the appropriate days and hours of operation for such Facility, which shall be
consistent with the days and hours of operation for other retail stores in the
respective Shopping Mall, Select Street Location, Qualifying Strip Center or,
for Outlet Facilities, the Outlet Center, as applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.4      <U>Staffing</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.4.1 <U>General Staffing
Matters</U>. All staffing matters for each Business Property, including, without
limitation, occupational health and safety measures, employee training, and
employee uniforms, costumes and grooming, shall comply with, and be subject to,
the Operating Manual and applicable Law. Without limiting the generality of the
foregoing, the following provisions shall apply with respect to employees of
Licensee or its Affiliates assigned to any Business Property or otherwise
involved in the operation of the Business (each, a <B>"Licensee
Employee")</B>: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Licensee
Employees shall be fully compensated solely by Licensee;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) Licensee
Employees shall not be entitled to participate in any of the Employee Benefit
Plans of TDSF or its Affiliates;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) Licensee shall
be solely responsible for all salaries, employee benefits, social security
taxes, federal or state unemployment insurance, workers' compensation coverage
and any and all required withholding of Taxes and other charges of any kind
whatsoever relating to Licensee Employees;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) All Licensee
Employees shall, as a condition of their employment, agree to be subject to and
comply with the Operating Manual, including, without limitation, the rules of
conduct (including working hours) and personal appearance standards established
in the Operating Manual; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) Licensee shall
be responsible for the failure of any Licensee Employee to comply with any
applicable provisions of this Agreement or the Operating Manual.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, in the event
that TDSF, in its business judgment, determines that any Licensee Employee is
conducting himself or herself in a manner that is inappropriate or injurious to,
or inconsistent with, the image, reputation, brand, appearance and quality of,
or that may impair the goodwill associated with, TDSF and its Affiliates, the
businesses, properties or products thereof, the Disney Properties, or any other
names, brands, trademarks, logos, symbols, characters or other proprietary
designations or intellectual property of TDSF and its Affiliates, TDSF shall
have the right, upon written notice to Licensee, to consult with Licensee with
regard to the appropriate manner to resolve the issues relating to such Licensee
Employee, and Licensee shall in good faith consider any suggestions made by
TDSF, <U>provided</U>, that Licensee shall have the right to make the final
determination regarding such Licensee Employee in Licensee&#146;s business
judgment. TDSF and its Affiliates shall have no liability in connection with any
assignment, reassignment, transfer, removal or discharge of any Licensee
Employee and Licensee shall indemnify and hold TDSF and its Affiliates harmless
in connection therewith. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.4.2 <U>Employee
Compensation and Benefits</U>. Licensee shall, or shall cause its Affiliates to,
(i) until the end of the first (1<FONT SIZE=1>st</FONT>) Contract Year or the date of
termination, if earlier, compensate each Licensee Employee that was employed by
TDSF or any of its Affiliates in connection with the operation of the Business
immediately prior to the Effective Date (each, a <B>"Continuing
Employee"</B>) at a rate not less than that at which such Continuing
Employee was compensated as an employee of TDSF or any of its Affiliates
immediately prior to the Effective Date (including any base salary and, with
respect to any employee at the director level or above, performance bonus (other
than any retention or similar stay bonus), other incentive compensation and
other forms of compensation (excluding stock options or comparable forms of
equity compensation)) and (ii) provide each Continuing Employee with Employee
Benefit Plans that, in the aggregate, provide benefits that are substantially
the same as the benefits provided by TCP to its similarly situated employees
having comparable responsibilities; <U>provided</U>, that if the Effective Date
is before January 1, 2005, Licensee or its Affiliates shall provide each
Continuing Employee with the opportunity to participate in a flexible spending
account (within the meaning of Section 125 of the Internal Revenue Code and the
regulations and proposed regulations thereunder) effective as of the first
payroll date coincident with or following the Effective Date. Each Continuing
Employee&#146;s period of service and compensation history with TDSF or its
Affiliates before the Effective Date shall be counted in determining eligibility
for, and the amount and vesting of, benefits under each of Licensee&#146;s
Employee Benefit Plans. Each Continuing Employee who participates in an Employee
Benefit Plan of Licensee or its Affiliates that provides health care benefits
(whether or not through insurance) shall participate without regard to any
waiting period or any condition or exclusion based on pre-existing conditions,
medical history, claims experience, evidence of insurability or genetic factors
(other than any condition or exclusion in effect immediately prior to the
Effective Date that such Employee Benefit Plan of Licensee or its Affiliates is
not required to cover under applicable Law) and, subject to Section 9.4.5(ii),
shall receive full credit for any co-payments or deductible payments made,
amounts paid toward maximum out-of-pocket expenses and other similar payments
made, and for account balances under any flexible spending account existing,
before the Effective Date. In the event that any Continuing Employee receives an
"Eligible Rollover Distribution" (within the meaning of Section
402(c)(4) of the Internal Revenue Code) from any Employee Benefit Plans of TDSF
or its Affiliates, Licensee or its Affiliates shall cause an Employee Benefit
Plan maintained by License or its Affiliates in which such Continuing Employee
participates that is intended to constitute a qualified plan under
Section&#160;401 of the Internal Revenue Code to accept a direct rollover of
such eligible rollover distribution (including any portion of such eligible
rollover distribution comprised of the outstanding balance of a loan from such
Employee Benefit Plan of TDSF or its Affiliates). After the end of the first
(1<FONT SIZE=1>st</FONT>) Contract Year, Licensee shall provide such compensation to
Licensee Employees (including Continuing Employees) as it deems appropriate in
its sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.4.3 <U>Employee
Discounts</U>. During the Term, Licensee shall provide employee discounts on
purchases of products sold in the Facilities and the Internet Store to all
employees of Licensee (and, at Licensee&#146;s option, to employees of
Licensee&#146;s Affiliates) in an amount equal to at least thirty percent (30%)
off of a product&#146;s retail (or discounted or reduced, as the case may be)
price; <U>provided</U>, that, commencing in the fourth (4<FONT SIZE=1>th</FONT>) Contract
Year, Licensee may, in its business judgment, increase or decrease such employee
discounts. In addition, for so long as TDSF provides Theme Park passes to
Licensee Employees in accordance with the terms of Section 9.9.10, Licensee
shall provide the same discount in the same percentage amount to all employees
of TDSF and its Affiliates with respect to all purchases of products sold in the
Facilities and the Internet Store. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.4.4 <U>Management
Team</U>. Notwithstanding anything to the contrary herein, (i)&#160;the hiring
or other appointment of the Chief Executive Officer, Chief Financial Officer and
Chief Operating Officer/President for TDS USA and TDS Canada, respectively, or,
if any such position does not exist, persons serving in similar capacities with
comparable duties (collectively, the <B>"Management Employees"</B>),
(ii)&#160;the termination or other dismissal of each of the Management
Employees, and (iii)&#160;the terms of employment of each of the Management
Employees shall be determined by Licensee in its business judgment following
Licensee&#146;s consultation in good faith with TDSF. Notwithstanding the
foregoing, TDSF and its Affiliates shall have no liability in connection with
any assignment, reassignment, transfer, removal or discharge of any Management
Employee and Licensee shall indemnify and hold TDSF and its Affiliates harmless
in connection therewith. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.4.5 <U>Severance and
Other Employee Benefits</U>. TDSF and its Affiliates shall be solely responsible
for, and shall indemnify and hold harmless Licensee, Licensee Parent and
Canadian Parent against, (i) with respect to any Continuing Employee whose
employment is terminated by Licensee or any of its Affiliates prior to the first
(1<FONT SIZE=1>st</FONT>) anniversary of the Effective Date, severance benefits payable
to such Continuing Employee upon such termination in an amount equal to the
severance benefits that would have been payable to such Continuing Employee
under the Disney Severance Plan had such termination occurred on the Effective
Date, <U>provided</U>, that, if any such terminated Continuing Employee is
subsequently rehired by Licensee or any of its Affiliates within one (1) year
following such termination, Licensee and/or Licensee Parent shall reimburse TDSF
and its Affiliates for all amounts paid thereby pursuant to this subparagraph
(i) of this Section 9.4.5, and (ii) all amounts paid by Licensee or Licensee
Parent following the Effective Date to ensure that, until the completion of the
calendar year in which the Effective Date occurs, Continuing Employees receive
full credit for (A) any co-payments or deductible payments made, amounts paid
toward maximum out-of-pocket expenses and other similar payments made during
such calendar year before the Effective Date, and (B) for account balances under
any flexible spending account existing before the Effective Date,
<U>provided</U> that, in the case of this subparagraph (B), the Effective Date
is on or before December&#160;31, 2004. Any amounts due from TDSF or its
Affiliates to Licensee in respect of the preceding sentence shall, following the
Effective Date, be invoiced by Licensee to TDSF on a Retail Monthly basis and
paid by TDSF or its Affiliate to Licensee within twenty (20) Business Days
following receipt of each such invoice. Except as otherwise provided in this
Section 9.4.5, Licensee acknowledges and agrees that it is solely responsible
for, and shall indemnify and hold harmless TDSF and its Affiliates against, any
and all Losses (including, without limitation, additional severance and other
amounts payable to or in respect of any Continuing Employee) arising directly or
indirectly from, out of or based on the termination of employment of any
Continuing Employee (and/or any other Licensee Employee) from and after the
Effective Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.5 <U>Customer Service;
Product Returns</U>. Licensee acknowledges that, in order to maintain the high
reputation and goodwill associated with TDSF and its Affiliates, Licensee&#146;s
performance of customer service functions in connection with the operation of
the Facilities, the Internet Store and the Business must be at least equal to
quality levels generally prevailing among full-priced specialty retail chains
focused on children&#146;s consumer products. To ensure this level of quality,
Licensee shall maintain staffing levels for the Facilities, the Internet Store
and the Business sufficient to provide prompt and courteous service consistent
with the name, image, brand and reputation of TDSF and its Affiliates and
otherwise comply with the Operating Manual (including, without limitation, any
provisions of the Operating Manual with respect to courtesy and cleanliness) in
performing customer service functions in connection with the operation of the
Facilities, the Internet Store and the Business. In addition, Licensee shall
maintain and comply with product return and refund policies with respect to
Disney Merchandise sold through the Facilities and the Internet Store that are
at least as favorable to Licensee&#146;s customers as the policies in effect at
the Facilities and the Internet Store immediately prior to the Effective Date,
except for modifications to such policies as may be approved by each of Licensee
and TDSF in its respective business judgment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.6      <U>Disney Merchandise</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.6.1 <U>General
Merchandise Management</U>. Licensee shall be responsible for determining the
merchandise, assortment and strategies to be employed in operating the Business,
which shall be set forth in a quarterly merchandise plan (the <B>"Quarterly
Merchandise Plan"</B>) for the Business for each Fiscal Quarter of Licensee
during the Term. At least one (1) Retail Month prior to the beginning of each
Fiscal Quarter, Licensee shall prepare and submit to TDSF the Quarterly
Merchandise Plan for the upcoming Fiscal Quarter (except that the Quarterly
Merchandise Plan for the first (1<FONT SIZE=1>st</FONT>) Fiscal Quarter shall be prepared
and submitted within one (1) Retail Month after the Effective Date). The
Quarterly Merchandise Plan shall in all cases contain one (1) or more SKUs of
Disney Merchandise within each of the three (3) Pre-Approved Merchandise
Categories, and any proposed Disney Merchandise that does not fall within one of
the three (3) Pre-Approved Merchandise Categories or an Additional Merchandise
Category shall require the prior written approval of TDSF in its sole discretion
pursuant to Section 9.19.3. Licensee shall consider in good faith any comments
or suggestions of TDSF with respect to each Quarterly Merchandise Plan. Each
Quarterly Merchandise Plan shall set forth information with respect to
merchandise categories and assortment, including detailed Disney Merchandise
lists by SKU, that Licensee proposes to employ in operating the Business
for the upcoming Fiscal Quarter and such other information relating to the
Disney Merchandise proposed to be offered for sale in the Facilities and the
Internet Store as will be reasonably necessary, or as TDSF may reasonably
request, to allow TDSF to make an informed judgment and appraisal of each
Quarterly Merchandise Plan. Any material variations from any Quarterly
Merchandise Plan for any Fiscal Quarter shall also be submitted to TDSF and, if
any such change contemplates the addition of Disney Merchandise that does not
fall within one of the three Pre-Approved Merchandise Categories or an
Additional Merchandise Category, such change shall also be subject to
TDSF&#146;s prior written approval in its sole discretion pursuant to
Section&#160;9.19.3. Licensee shall be entitled to determine product pricing and
inventory levels of Disney Merchandise in its sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.6.2 <U>Disney
Dollars</U>. TDSF and/or certain of its Affiliates have issued and/or may in the
future issue Disney Dollars, which can be redeemed for or used as a method of
payment to purchase a variety of products and services offered by TDSF and its
Affiliates. In connection with any and all Disney Dollars, Licensee agrees that
it shall, in accordance with TDSF&#146;s instructions: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Accept and
honor, as a valid method of payment, at their face value, throughout all of the
Facilities (other than the Facilities located in Canada (unless otherwise
determined by TDSF) and excluding the Internet Store), for all Disney
Merchandise offered therein (or such portion thereof as may be designated by
TDSF from time to time), any and all Disney Dollars, and install, maintain,
support, modify and administer such information technology and systems at or for
the Facilities as may be reasonably requested by TDSF in order to enable the
processing of transactions with Disney Dollars at such Facilities;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) Issue,
throughout all of the Facilities (except for Facilities located in Canada
(unless otherwise determined by TDSF) or as otherwise specified in writing by
TDSF in its sole discretion), at face value, Disney Dollars in denominations of
One Dollar ($1), Five Dollars ($5) and Ten Dollars ($10), and such additional
denominations (e.g., collectible denominations such as Fifty Dollars ($50)) as
TDSF may designate from time to time, and install, maintain, support, modify and
administer such information technology and systems at or for the Facilities as
may be reasonably requested by TDSF in order to enable the issuance of such
Disney Dollars at the Facilities;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) Maintain an
adequate inventory of Disney Dollars to satisfy consumer demand therefor
throughout the Facilities and report to TDSF or its designated Affiliate, within
twenty (20) Business Days following the end of each fiscal month of TDSF, the
amount of such inventory of Disney Dollars maintained by Licensee as of the end
of such fiscal month of TDSF. The sufficiency of the amount of such inventory of
Disney Dollars maintained by Licensee shall be determined in good faith
consultation with TDSF and shall be subject to TDSF's approval in its business
judgment. Such inventory of Disney Dollars shall exclude any Disney Dollars
accepted from customers at the Facilities as a method of payment for Disney
Merchandise in the Facilities, all of which shall be cancelled and returned by
Licensee to TDSF or its designated Affiliate (i.e., Disneyland Resort Currency
Services) on a monthly basis in accordance with procedures determined by TDSF in
its business judgment. With respect to such Disney Dollars that are redeemed at
the Facilities, cancelled and returned by Licensee to TDSF or its Affiliates,
(i) TDSF or its Affiliates shall, at their election in their sole discretion,
either (x) grant Licensee a credit against future purchases of Disney Dollars
hereunder equal to the face amount of such redeemed, cancelled and returned
Disney Dollars, or (y) on a monthly basis pay Licensee in cash an amount equal
to the face amount of such redeemed, cancelled and returned Disney Dollars via
wire transfer to an account of Licensee designated by it, and (ii) TDSF or its
Affiliates shall reimburse Licensee for its reasonable, out-of-pocket,
documented costs incurred in returning such Disney Dollars to TDSF or its
designated Affiliate so long as Licensee shall use a shipping service approved
by TDSF in its business judgment;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) Purchase
Licensee's inventory of Disney Dollars at face value from TDSF or its designated
Affiliate (i.e., Disneyland Resort Currency Services). Upon receipt of an order
for Disney Dollars from Licensee, TDSF or its designated Affiliate will deliver
to Licensee a written invoice setting forth (i) the quantity, denominations and
serial numbers of the Disney Dollars ordered and (ii) the aggregate face value
thereof. Licensee shall pay each such Disney Dollar invoice within five (5)
Business Days of receipt thereof via wire transfer of same day funds to an
account designated by TDSF or its designated Affiliate, whereupon the Disney
Dollars that are covered by such Disney Dollar invoice shall be shipped to
Licensee, at the expense of TDSF or its Affiliates, and no shipment thereof
shall occur until such payment in full has been received by TDSF or its
designated Affiliate;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) Participate
from time to time in marketing, advertising or promotional activities pertaining
to the acquisition and usage of Disney Dollars, including, without limitation,
the display of signage at point-of-sale locations in all Facilities advertising
the sale of Disney Dollars at each such Facility, the form, manner, location and
all other elements of such signage to be determined by TDSF in its sole
discretion; provided that, with respect to marketing, advertising or promotional
activities (other than the point-of-sale signage described above) under this
subparagraph (e) in which Licensee is required to participate without its
approval or consent, TDSF shall, or shall cause its Affiliates or a third Person
to, reimburse Licensee for all documented, out-of-pocket, direct advertising
costs and expenses (specifically excluding agency fees or any imputed costs)
incurred by Licensee as a result of such marketing, advertising or promotional
activities (e.g., the cost of in-store collateral materials, newspaper
advertising placements, billboards);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) Provide to TDSF
and its Affiliates, within twenty (20) Business Days following the end of each
month, information regarding the volume of Disney Dollars issued and redeemed at
the Facilities during such month;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) Not use any of
the creative design or production elements of the Disney Dollars, all of which
shall be retained in their entirety by TDSF and/or its Affiliates, nor offer any
certificate, currency, form of payment or other instrument that is comparable to
or that competes with the Disney Dollars; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) Take or refrain
from taking such additional actions as TDSF may reasonably request in connection
with the issuance and acceptance of Disney Dollars (<U>provided</U> that, if any such
additional actions result in the imposition on Licensee of any obligations
materially more onerous than those set forth in the preceding subparagraphs (a)
through (g), inclusive, TDSF shall reimburse Licensee for its actual, reasonable
costs and expenses incurred or suffered as a result thereof).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.6.3    <U>Merchandise Sharing Obligations</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Obligations of
Licensee</U>. Upon request, Licensee and its Affiliates shall make available (by
selling or arranging for the Manufacturers to supply) Disney Merchandise to
Affiliates of TDSF and to Japan Disney Store Operators at such fair-market
prices and/or royalty rates and other customary terms and conditions as shall be
negotiated by the parties to such transactions in good faith; <U>provided</U>, that,
upon Licensee's request, if its obligations under this Section 9.6.3(a) with
respect to Japan Disney Store Operators are causing a material disruption in the
operation of the Business by Licensee, TDSF shall use commercially reasonable
efforts (other than the expenditure of money) to reduce the extent to which
Licensee is required to perform such obligations as necessary in order to
alleviate such material disruption of Licensee's operation of the Business. In
addition, in the event that Licensee requests to purchase Other Disney Store
Merchandise (other than Japan Disney Store Merchandise) from Other Disney Store
Operators (other than Japan Disney Store Operators) and such Other Disney Store
Operators agree to do so, Licensee and its Affiliates shall, upon request, make
available (by selling or arranging for the Manufacturers to supply) Disney
Merchandise to such Other Disney Store Operators at such fair-market prices
and/or royalty rates and other customary terms and conditions as shall be
negotiated by the parties to such transactions in good faith. Nothing herein
shall prohibit or be deemed to prohibit Licensee from making available (by
selling or arranging for the Manufacturers to supply) Disney Merchandise to
Other Disney Store Operators at Licensee's election, except to the extent that
TDSF or any of its Affiliates have prohibited or not approved the offer for
sale, sale, marketing, advertising or promotion of such Disney Merchandise
outside of the Territory.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Obligations of
TDSF</U>. TDSF and its Affiliates shall use commercially reasonable efforts (other
than the expenditure of money) to cause (i) Japan Disney Store Operators to make
available (by selling or arranging for their manufacturers to supply) Japan
Disney Store Merchandise to Licensee, (ii) Other Disney Licensees within the
Territory to make available (by selling or arranging for their manufacturers to
supply) Other Licensee Merchandise to Licensee, (iii) BVHE to make available (by
selling or arranging for its manufacturer to supply) home video products (which
includes DVDs and other comparable new technologies that may be developed in the
future for the home viewing of film properties) ("<B>BVHE Merchandise</B>") to Licensee
and (iv) upon Licensee's request and subject to Licensee's compliance with its
obligations under the second sentence of Section 9.6.3(a), Other Disney Store
Operators (other than Japan Disney Store Operators) to make available (by
selling or arranging for their manufacturers to supply) Other Disney Store
Merchandise (other than Japan Disney Store Merchandise) to Licensee, in each
case under the preceding subparagraphs (i), (ii), (iii) and (iv) at such
fair-market prices and/or royalty rates and other customary terms and conditions
as shall be negotiated by the parties to such transactions in good faith but, in
the case of the preceding subparagraph (iii), subject to Section 9.6.5. Before
Licensee may offer for sale, sell, market, advertise or promote any such Other
Disney Store Merchandise (including Japan Disney Store Merchandise), Other
Licensee Merchandise or BVHE Merchandise, Licensee must first obtain all
approvals with respect to such merchandise that are required pursuant to this
Agreement (including, without limitation, the approval provisions contained in
Section 5). Licensee acknowledges and agrees that, notwithstanding the fact that
TDSF or any of its Affiliates previously may have approved the sale of Other
Disney Store Merchandise (including Japan Disney Store Merchandise), Other
Licensee Merchandise or BVHE Merchandise by an Other Disney Store Operator
(including a Japan Disney Store Operator), an Other Disney Licensee or BVHE, as
the case may be, TDSF shall be entitled to determine, in its sole discretion,
subject to Section 5.1.3(h), whether any such merchandise may be offered for
sale, sold, marketed, advertised or promoted by Licensee as Disney Merchandise
through the Facilities and/or the Internet Store under this Agreement. Any Other
Disney Store Merchandise (including Japan Disney Store Merchandise), Other
Licensee Merchandise or BVHE Merchandise that is approved by TDSF hereunder and
that, after obtaining TDSF's approval hereunder, Licensee offers for sale,
sells, markets, advertises or promotes in accordance with this Section 9.6.3(b)
and the other provisions of this Agreement shall be deemed to be Disney
Merchandise for purposes of this Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Availability of
Merchandise Designs</U>. Licensee shall endeavor to make available for review and
use by Affiliates of TDSF, Japan Disney Store Operators and, if applicable,
Other Disney Store Operators (other than Japan Disney Store Operators) the
merchandise designs of any Disney Merchandise made available by Licensee
pursuant to Section 9.6.3(a) (in each case subject to reasonable confidentiality
undertakings), and TDSF and its Affiliates shall endeavor to cause Japan Disney
Store Operators, Other Disney Licensees within the Territory, BVHE and, if
applicable, Other Disney Store Operators (other than Japan Disney Store
Operators) to make available for review and use by Licensee the merchandise
designs of any Other Disney Store Merchandise (including Japan Disney Store
Merchandise), Other Licensee Merchandise or BVHE Merchandise made available to
Licensee pursuant to Section 9.6.3(b) (in each case subject to reasonable
confidentiality undertakings).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.6.4 <U>Product
Warranties</U>. Each of TDS USA and TDS Canada, jointly and severally, hereby
warrants to TDSF and its Affiliates and to each customer of Licensee, with
respect to all Disney Merchandise or other consumer products or merchandise
developed, manufactured or offered for sale by TDS USA and/or TDS Canada, that
each of such Disney Merchandise and other products and merchandise
(i)&#160;shall be manufactured and assembled in compliance with all applicable
Laws and the terms of this Agreement, (ii) shall contain all instructions,
warnings, labels and other materials as may be required by applicable Laws,
(iii)&#160;shall be of good quality and fit for its intended use by consumers,
(iv)&#160;shall be free from any defect in design, material or workmanship,
(v)&#160;shall not be misbranded, adulterated or unsafe within the meaning of
any applicable Laws, and (vi)&#160;shall comply in all respects with all
applicable Laws, including, without limitation, all applicable Laws pertaining
to articles, materials or substances banned from commerce into or within the
Territory. In addition, to the extent Licensee obtains any product warranty from
any manufacturer or vendor of Disney Merchandise or other consumer products
developed, manufactured or offered for sale by Licensee at the Facilities and/or
the Internet Store, Licensee shall also obtain such warranty for the benefit of
TDSF and its Affiliates in each instance and, in any case when Disney
Merchandise is acquired by Other Disney Store Operators, for the benefit of such
Other Disney Store Operators as well. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.6.5 <U>Purchase of Home
Entertainment Products</U>. In the event that Licensee requests to purchase any
digital video discs, home videos or other home entertainment products from TDSF
or its Affiliates (including, without limitation, BVHE), TDSF shall, or shall
cause its Affiliates to, make available (by selling or arranging for its or
their manufacturers to supply) such digital video discs, home videos or other
home entertainment products to Licensee on terms and conditions that are
reasonably comparable to those offered by TDSF or its Affiliates to similarly
situated retailers with respect to digital video discs, home videos or other
home entertainment products purchased by such similarly situated retailers in
similar quantities, which terms and conditions may include, to the extent
Licensee qualifies therefor based on criteria applicable to such similarly
situated retailers, the availability of certain credit terms, volume discounts
and other similar benefits, in each case in accordance with applicable Laws;
<U>provided</U> that, TDSF shall cause BVHE (or such other Affiliate of TDSF as
TDSF shall designate in its sole discretion) to provide for payment of each
invoice for such digital video discs, home videos and other home entertainment
products by Licensee within sixty (60) days (as opposed to any shorter period
that would otherwise be applicable to Licensee). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.6.6 <U>Disposition of
Defective Merchandise</U>. Notwithstanding anything to the contrary contained
herein (other than provisions relating to the sale of slightly irregular
Softlines of Disney Merchandise pursuant to Section 6.3(i)(c)), any Disney
Merchandise or other consumer products or merchandise developed, manufactured or
offered for sale by Licensee that are damaged or defective in any way shall be
either: (i) destroyed by Licensee at its sole cost and expense or (ii) donated
to a charitable organization selected by Licensee following Licensee&#146;s
consultation in good faith with TDSF; <U>provided</U>, that, with respect to
subparagraph (ii) of this Section 9.6.6, Licensee shall (a) be solely
responsible for ensuring that any such damaged or defective Disney Merchandise
or other consumer products or merchandise so donated complies with product
warranties and all applicable Laws, including, without limitation, consumer
product safety regulations, and that any such donation complies with all
applicable Laws, and (b) indemnify and hold harmless TDSF and its Affiliates for
any failure of any such Disney Merchandise or other consumer products or
merchandise or any such donation to so comply with such product warranties and
applicable Laws, as applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.7      <U>Covenants Relating to Real Property</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.7.1    <U>Conduct Relating to Leased Property</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Obligations
Under Leases</U>. Licensee shall comply with all of its material duties and
obligations under the terms of each Lease Agreement. To the extent Licensee has
Knowledge thereof, Licensee shall promptly deliver written notice to TDSF of any
action or non-action by the landlord or sublandlord of each Lease Agreement (the
"<B>Landlord</B>") or any other party thereto that is, or would with the passage
of time or the giving of notice or both become, a default under such Lease
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Notices With
Respect to Leased Properties</U>. Licensee shall deliver to TDSF copies of (i)
any material notices delivered to Licensee pursuant to a Lease Agreement from
the Landlord or any other applicable party to a Lease Agreement, (ii) any other
material correspondence received by Licensee from the Landlord relating to a
Leased Property, and (iii) any material notices or correspondence delivered to
Licensee from any third parties (including, without limitation, any Governmental
Entities or insurance carriers) relating to a Leased Property. Such copies shall
be delivered by Licensee to TDSF promptly and no later than ten (10) Business
Days after receipt by Licensee. Licensee shall deliver to TDSF copies of (x) any
material notices that Licensee delivers to the Landlord pursuant to a Lease
Agreement, (y) any other material correspondence that Licensee delivers to the
Landlord relating to a Leased Property and (z) any material notices or
correspondence that Licensee delivers to any third parties (including, without
limitation, any Governmental Entities or insurance carriers) relating to a
Leased Property. Such copies shall be delivered by Licensee to TDSF promptly and
no later than ten (10) Business Days after delivery of such documents to the
Landlord or to any third party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Insurance
With Respect to Leased Properties</U>. Upon TDSF's request (made in TDSF's sole
discretion), Licensee shall, within one (1) month following the Effective Date
or the date of any Lease Extension Arrangement or New Business Property Lease
Agreement, and from time to time as requested by TDSF, provide proof to TDSF
that Licensee is maintaining sufficient insurance with respect to all Lease
Agreements by delivering to TDSF true, complete and current copies of its
insurance policies or certificates of insurance in form and content reasonably
satisfactory to TDSF. Licensee shall also deliver to TDSF all notices it
receives from its insurance providers that relate to the type of coverage, the
amount of coverage or termination of coverage promptly and no later than ten
(10) Business Days after receipt by Licensee. In addition, Licensee shall name
TDSF and its Affiliates as additional insureds under its comprehensive general
liability insurance policy for each Leased Property or, if the Landlord carries
such insurance and if practicable through the exercise of Licensee's
commercially reasonable efforts, cause the Landlord to name TDSF and its
Affiliates as additional insureds. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d)
<U>Environmental Matters With Respect to Leased Properties</U>. Licensee shall
comply in all material respects with all applicable Environmental Laws with
respect to each Leased Property and shall keep each Leased Property free from
any Hazardous Substances. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) <U>Notification
and Summary of Proposed Lease Agreements</U>. At least five (5) Business Days
prior to entering into any Lease Agreement with a Landlord, Licensee shall
provide to TDSF written notice of its intention to enter into such Lease
Agreement (the "<B>Proposed Lease Agreement Notice</B>"), which Proposed Lease
Agreement Notice shall include (i) the name and address of the Landlord and (ii)
a summary of the material terms of such Lease Agreement, consisting of the term
thereof, Licensee's rental obligations (including base rent, percentage rent and
common area maintenance charges or comparable payments if designated by a
different name), a statement of aggregate capital expenditure obligations
thereunder, any other forms of consideration to be provided to the Landlord by
Licensee, termination rights, any rights arising in connection with a change of
control transaction, and any rights of TDSF (or purported obligations of TDSF)
arising thereunder and the enforcement mechanisms associated therewith, in the
form of <U>Schedule 9.7.1(e)</U>. In the event that such material terms are not
satisfactory to TDSF in its business judgment, TDSF shall provide to Licensee
written notice of its objections to such terms within five (5) Business Days
following the Proposed Lease Agreement Notice and such objections immediately
shall be submitted to (x) the President of TWDC's Consumer Products Division or,
at TDSF's option, the President of TWDC (or, if no person holds either such
title, a senior executive officer of TWDC performing a similar function) and (y)
the Chief Executive Officer of Licensee (or, if no person holds either such
title, a senior executive officer of such entity performing a similar function)
or, at TDSF's option, the Board of Licensee, who shall negotiate in good faith
with one another in an effort to resolve the dispute, <U>provided</U>, that,
notwithstanding any such objection by TDSF and prior to resolution thereof,
Licensee shall be entitled to enter into the proposed Lease Agreement on the
terms set forth in the Proposed Lease Agreement Notice so long as such proposed
Lease Agreement complies with all of the other requirements set forth in this
Agreement with respect to Lease Agreements, including, without limitation,
Section 9.19.4. Notwithstanding anything to the contrary herein, this Section
9.7.1(e) shall not apply to, and Licensee shall not be required to provide a
Proposed Lease Agreement Notice with respect to, any amendment or modification
to a then existing Lease Agreement unless such amendment or modification relates
to or affects any of the material terms of such existing Lease Agreement as set
forth in subparagraph (ii) of this Section 9.7.1(e). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) <U>Limited
Termination Rights of Licensee</U>. Except in connection with Permitted Closings
as to which all of the requirements set forth in, and any TDSF approvals
required by, this Agreement have been complied with and/or obtained and in
connection with which, in the case of a Disney-Guaranteed Lease, Licensee has
obtained a full and final release of TDSF and its Affiliates from any and all
obligations with respect to the applicable Facility (whether under the terms of
the applicable Lease Agreement, by operation of law, or otherwise) in a form
satisfactory to TDSF in its sole discretion, Licensee shall not exercise any
termination rights that Licensee may have under a Lease Agreement (including,
without limitation, termination rights following a casualty or condemnation)
without first obtaining TDSF's written approval in its sole discretion, which
approval shall be sought in accordance with the approval provisions set forth in
Section 9.19.1 or 9.19.3, as applicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) <U>TDSF
Termination Rights With Respect to Disney-Guaranteed Leases</U>. Following the
date that is three (3) months after the Subsequent Closing Date (or, if no
Subsequent Closing occurs, following the date that is three (3) months after the
expiration of the Subsequent Closing Period), with respect to any Leased
Property as to which TDSF or any of its Affiliates is an obligor or guarantor or
is otherwise liable under the applicable Lease Agreement (whether under the
terms of the applicable Lease Agreement, by operation of law, or otherwise)
(each, a "<B>Disney-Guaranteed Lease</B>," which, in any event, shall be deemed to
include all Lease Agreements assigned to Licensee upon or in connection with the
Subsequent Closing), TDSF may, in its sole discretion, require Licensee to
exercise any right of termination that Licensee may have under such
Disney-Guaranteed Lease, unless Licensee is able to obtain a full and final
release of TDSF and its Affiliates from any guarantee or other obligations under
such Disney-Guaranteed Lease in a form satisfactory to TDSF in its sole
discretion. If a termination right arises under any Disney-Guaranteed Lease,
then (x) Licensee shall promptly notify TDSF in writing of such termination
right and the time period during which it may be exercised and any limitations
relating thereto, and (y) TDSF may notify Licensee of its election to terminate
such Disney-Guaranteed Lease at any time during the period in which Licensee is
entitled to exercise its termination right under such Disney-Guaranteed Lease.
Upon such notice by TDSF to Licensee, Licensee shall promptly terminate such
Disney-Guaranteed Lease. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) <U>Expiring
Disney-Guaranteed Leases</U>. Following the date that is three (3) months after
the Subsequent Closing Date (or, if no Subsequent Closing occurs, following the
date that is three (3) months after the expiration of the Subsequent Closing
Period), with respect to any Disney-Guaranteed Lease, Licensee shall not enter
into any Lease Extension Arrangement or operate the applicable Facility beyond
the expiration date of the Original Lease Term of such Disney-Guaranteed Lease
(including, without limitation, by establishing a month-to-month tenancy),
unless Licensee has obtained from the Landlord a full and final release of TDSF
and its Affiliates from any guarantee or other obligations under such
Disney-Guaranteed Lease in a form satisfactory to TDSF in its sole discretion.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) <U>Acquisition
of Lease Agreements from Bankruptcy</U>. Licensee shall be permitted to acquire
Lease Agreements in proceedings under the Federal Bankruptcy Code or any other
applicable bankruptcy Law, subject in each case to all of the requirements set
forth in, and any TDSF approvals required by, this Agreement, including, without
limitation, this Section 9.7.1 and Section 9.19, and to approval of the
applicable bankruptcy court and compliance with all applicable bankruptcy and
other Laws. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (j) <U>Assignment
and Subletting</U>. Licensee and its Subsidiaries may not Transfer all or any
part of a Leased Property (i) to TCP or any of its Affiliates (other than
Licensee) without TDSF's prior written approval in its sole discretion, or (ii)
to any other Person without TDSF's prior written approval in its business
judgment; <U>provided</U>, that, with respect to this subparagraph (ii), if TDSF and
its Affiliates have no liability with respect to such Leased Property under
applicable Law or under Contract as determined by TDSF, or if Licensee is able
to obtain a full and final release of TDSF and its Affiliates from any and all
obligations with respect to such Leased Property (whether under the terms of the
applicable Lease Agreement, by operation of law, or otherwise) in a form
satisfactory to TDSF in its sole discretion in connection with such Transfer,
TDSF's approval shall not be required with respect to such Transfer unless, at
the time of such Transfer, there are outstanding ten (10) or more Leased
Properties that have been Transferred by Licensee or its Subsidiaries without
the approval of TDSF pursuant to this subparagraph (ii) of this Section
9.7.1(j), in which case such Transfer shall be subject to TDSF's prior written
approval in its business judgment. Any approval of TDSF required pursuant to
this Section 9.7.1(j) shall be sought in accordance with the approval provisions
set forth in Section 9.19.3. In the event of any Transfer by Licensee or its
Subsidiaries of all or any part of a Leased Property to TCP, any of its
Affiliates or any other Person, Licensee shall provide TDSF with at least five
(5) Business Days' advance written notice thereof, regardless of whether TDSF's
approval is required in connection therewith pursuant to this Section 9.7.1(j).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (k) <U>Limitations
on Short-Term Leases</U>. Licensee agrees that (i) during the period beginning
on the sixtieth (60th) day after the Effective Date and ending on December 31,
2005, there shall be no more than seventy-five (75) Short-Term Leases for Core
Stores in effect at any time, (ii) during the period beginning on January 1,
2006 and ending on December 31, 2007, there shall be no more than fifty (50)
Short-Term Leases for Core Stores in effect at any time, and (iii) on and after
January 1, 2008, no more than ten percent (10%) of the Facilities shall be
leased pursuant to Short-Term Leases at any time; <U>provided</U>, that during the last
three (3) Contract Years of the Initial Term or any Renewal Term, if the Term
has not been renewed pursuant to Section 2.2 prior to the beginning of such
three (3) Contract Year period, any Lease Agreement renewed during such three
(3) Contract Year period may have a termination date that coincides with the
expiration date of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (l) <U>No Licensee
Parent or Canadian Parent Guarantees</U>. Without the prior written approval of
TDSF in its sole discretion, Licensee shall not authorize or permit Licensee
Parent or Canadian Parent, under any circumstances, to be or agree to be an
obligor or guarantor, or to be or agree to be otherwise liable, under or with
respect to (i) any Lease Agreement, (ii) any Leased Property or other Business
Property or (iii) any other leased property (including, without limitation, any
leased personal property) that was, is or will be used by Licensee relating to,
or associated with, the Business or any lease or other Contract with respect
thereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (m) <U>Delivery of
Executed Lease Agreements</U>. Licensee shall deliver to TDSF a copy of all
Lease Agreements entered into after the Effective Date promptly after their
execution. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.7.2 <U>Conduct Relating
to Other Real Property</U>. Licensee shall not occupy, use or operate any Other
Real Property in connection with the Business without the prior written approval
of TDSF in its sole discretion, which approval shall be sought in accordance
with the approval provisions set forth in Section&#160;9.19.1. If such written
approval is obtained with respect to any such Other Real Property, Licensee
shall comply with each of the following provisions set forth in this
Section&#160;9.7.2 regarding such Other Real Property: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Notices and
Correspondence</U>. Licensee shall deliver to TDSF copies of all material
notices or other correspondence delivered to Licensee from any third parties
(including, without limitation, any Governmental Entities or insurance carriers)
relating to such Other Real Property. Such copies shall be delivered by Licensee
to TDSF promptly, and no later than three (3) Business Days after receipt by
Licensee. Licensee shall deliver to TDSF copies of any material notices or
correspondence that Licensee delivers to any third parties (including, without
limitation, any Governmental Entities or insurance carriers) relating to such
Other Real Property. Such drafts shall be delivered by Licensee to TDSF
promptly, and no later than three (3) Business Days after delivery of such
documents to any third party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Insurance
With Respect to Other Real Property</U>. Licensee shall provide TDSF with proof
that Licensee is maintaining that amount and type of insurance carried by
similarly situated property owners or users, or both, of property that is
similar to such Other Real Property and that is being used for similar purposes
as such Other Real Property by delivering to TDSF true, complete and current
copies of its insurance policies or certificates of insurance in form and
content reasonably satisfactory to TDSF. Licensee shall also promptly deliver to
TDSF all notices it receives from its insurance providers that relate to the
type of coverage, the amount of coverage or termination of coverage for such
Other Real Property. In addition, Licensee shall name TDSF as an additional
insured on its comprehensive general liability insurance policy for such Other
Real Property. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c)
<U>Environmental Matters With Respect to Other Real Property</U>. Licensee shall
comply in all material respects with all applicable Environmental Laws with
respect to such Other Real Property and shall keep such Other Real Property free
from any Hazardous Substances. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d)
<U>Transfers</U>. Licensee may not Transfer such Other Real Property, or any
part of it or any interest in it, (i) to TCP or any of its Affiliates (other
than Licensee) without TDSF's prior written approval in its sole discretion, or
(ii) to any other Person without TDSF's prior written approval in its business
judgment. Any approval of TDSF required pursuant to this Section 9.7.2(d) shall
be sought in accordance with the approval provisions set forth in Section
9.19.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.8      <U>Strategic Alliances</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.8.1 <U>General</U>. TDSF
and/or its Affiliates are currently parties to, and from time to time in the
future will become parties to, certain strategic and corporate alliances with
various unrelated third parties pertaining to, among other things, marketing,
advertising and promotional arrangements, product supply and sourcing
arrangements, and other comparable arrangements for the Theme Park, cruise line,
media, entertainment and consumer products businesses of TDSF and its
Affiliates, including, without limitation, the Co-Branded Credit Card Agreements
(collectively, <B>"Strategic Alliances"</B>). Licensee acknowledges
and agrees that, in connection with these Strategic Alliances, TDSF may from
time to time exercise its approval rights under this Agreement, including with
respect to Licensee&#146;s use of the Licensed Materials under Sections&#160;4
and 5, to ensure TDSF&#146;s and/or its Affiliates&#146; compliance with the
terms of such Strategic Alliances. Licensee further agrees that, in the event
that, following the Effective Date, TDSF and/or its Affiliates propose to enter
into any new Strategic Alliance or amend or modify any existing Strategic
Alliance, Licensee shall, upon TDSF&#146;s request (made in TDSF&#146;s sole
discretion) and for such reasonable period of time as TDSF may request, engage
in good faith negotiations with TDSF and/or its Affiliates regarding the terms
and conditions (including, without limitation, separate compensation to
Licensee) upon which Licensee, through the Business, the Facilities and/or the
Internet Store, may engage in such Strategic Alliance together with TDSF and/or
its Affiliates and the respective alliance party, <U>provided</U>, that TDSF
shall be under no obligation whatsoever to make any such request (but rather may
enter into any such Strategic Alliance or amendment or modification thereof
without any consultation, discussion or negotiation with Licensee whatsoever)
and that, if TDSF does make such request, each of Licensee and TDSF and/or its
Affiliates shall be entitled to decide whether to enter into any such Strategic
Alliance (and TDSF and/or its Affiliates shall be entitled to decide whether, if
Licensee is willing, to include Licensee in such Strategic Alliance), in each
case in its respective sole discretion, and may terminate such discussions at
the end of the period reasonably requested by TDSF without recourse or remedy by
the other party and without any abatement or reduction of any payments or other
obligations hereunder. Any agreement reached under this Section&#160;9.8.1 shall
be memorialized in a separate written agreement. Licensee further agrees that,
in connection with the operation of the Business, the Facilities and/or the
Internet Store, it shall not, nor shall it permit its Affiliates to, enter into
strategic or corporate alliances or any other marketing or promotional Contracts
with any unrelated third parties or other Persons, whether with respect to any
form of marketing, advertising and promotional arrangements, product supply and
sourcing arrangements, or any other comparable arrangements, without the prior
written consent of TDSF, to be obtained pursuant to the procedures set forth in
Section 9.19.3 and to be granted or denied in TDSF&#146;s sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.8.2 **.
</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information (consisting of a total of 4 pages) is confidential and has
been omitted and separately filed with the Securities and Exchange
Commission.</I></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.8.3 **.
</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information (consisting of a total of 2 pages) is confidential and
has been omitted and separately filed with the Securities and Exchange
Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.8.4 <U>Other Disney Cards
and Non-U.S. Strategic Alliances</U>. TDSF and/or its Affiliates are currently
parties to, or from time to time in the future may become parties to, certain
strategic and corporate alliances with various unrelated third parties
pertaining to the issuance of credit and/or charge cards outside of the
Territory or marketing, advertising and/or promotional arrangements with respect
to Payment Service Products outside of the Territory (collectively,
<B>"Non-U.S. Strategic Alliances"</B>). To the extent that any of the
Non-U.S. Strategic Alliances provide any such third parties with rights within
the Territory (including, without limitation, rights with respect to acceptance
of such cards as a method of payment at the Facilities and/or the Internet Store
or marketing, advertising or promotional activities with respect to Payment
Service Products related to the Facilities and/or the Internet Store), TDSF
shall notify Licensee of such Non-U.S. Strategic Alliances and Licensee shall
take or refrain from taking such actions as TDSF may reasonably request in order
to ensure the compliance of TDSF and its Affiliates with the terms and
conditions of such Non-U.S. Strategic Alliances; <U>provided</U>, that, in making any
such request, TDSF (a) shall not impose on Licensee any obligations materially
more onerous than those contained in the Co-Branded Card Agreements as they
exist as of the Effective Date and as they are incorporated into the terms of
Section 9.8.2 (or if any such obligations imposed on Licensee are materially
more onerous, Licensee shall nonetheless comply therewith if such obligations
can be reasonably quantified and alleviated by monetary compensation and TDSF
agrees to reimburse Licensee for its actual, reasonable costs and expenses
incurred or suffered in connection therewith), and (b) shall confirm to Licensee
that such Non-U.S. Strategic Alliance shall not result in any such additional
imposition as specified in the preceding subparagraph (a) (or that TDSF will
reimburse Licensee for the actual, reasonable costs and expenses incurred or
suffered by Licensee as a result of such imposition, if applicable). Licensee
agrees that it will continue to be bound by the provisions of this
Section&#160;9.8.4 notwithstanding any amendment, modification, extension,
renewal or replacement of any of the Non-U.S. Strategic Alliances, including,
without limitation, any of the foregoing that may result in any credit and/or
charge cards issued thereunder being issued by a different financial institution
or that may arise from the Transfer of the portfolio of such credit and/or
charge card accounts (in which event the new financial institution issuing such
cards shall be treated for purposes of this Section&#160;9.8.4 as if it were the
original financial institution), <U>provided</U>, that, in each case, (i) any
such amendment, modification, extension, renewal or replacement shall not result
in the imposition on Licensee of any obligations materially more onerous than
those contained in the Co-Branded Card Agreements as they exist as of the
Effective Date and as they are incorporated into the terms of Section 9.8.2 (or
if any such obligations imposed on Licensee are materially more onerous,
Licensee shall nonetheless comply therewith if such obligations can be
reasonably quantified and alleviated by monetary compensation and TDSF agrees to
reimburse Licensee for its actual, reasonable costs and expenses incurred or
suffered in connection therewith), and (ii) TDSF shall promptly notify Licensee
of any such amendment, modification, extension, renewal or replacement and
confirm to Licensee that such amendment, modification, extension, renewal or
replacement shall not result in any such additional imposition as specified in
the preceding subparagraph (i) (or that TDSF will reimburse Licensee for the
actual, reasonable costs and expenses incurred or suffered by Licensee as a
result of such imposition, if applicable). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.8.5 <U>Other Strategic
Alliance Arrangements</U>. From time to time during the Term, upon TDSF&#146;s
request, Licensee shall participate, in accordance with TDSF&#146;s
instructions, in marketing, advertising or promotional activities pertaining to
other Strategic Alliances with TDSF, its Affiliates and its Strategic Alliance
partners; <U>provided </U>that, with respect to any such marketing, advertising
or promotional activities in which Licensee is required to participate without
its approval or consent, TDSF shall, or shall cause a third Person to, reimburse
Licensee for all documented, out-of-pocket, direct advertising costs and
expenses incurred by Licensee as a result of such marketing, advertising or
promotional activities (<U>e.g.</U>, the cost of in-store collateral materials,
newspaper advertising placements, billboards). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.8.6 <U>Introductions to
Strategic Alliance Parties</U>. From time to time, but not more often than three
(3) times per Contract Year unless otherwise agreed to by the parties in their
respective sole discretion, Licensee may request that TDSF and/or its Affiliates
arrange for the introduction of Licensee to representatives of any of the
various unrelated third parties with whom TDSF and/or its Affiliates have
entered into major, multi-business unit, corporate strategic alliances. Upon
such request by Licensee, to the extent that TDSF and/or its Affiliates
determine in their sole discretion that it is feasible and appropriate, TDSF
and/or its Affiliates shall (i) arrange for such introduction and (ii) permit
Licensee to participate in discussions with such representatives regarding the
Facilities and the Internet Store (either with or without the participation of
TDSF and/or its Affiliates, as determined by TDSF in its sole discretion). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.9      <U>Synergy Rights and Obligations</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.9.1 <U>Theme Park
Admissions</U>. Licensee shall procure from TDSF or its Affiliates and offer for
sale and sell to retail customers in all of the Facilities (unless TDSF shall
otherwise determine in its sole discretion) general admission tickets and passes
and other admission media, if any, for Theme Parks owned, leased, licensed,
controlled and/or operated by TDSF or its Affiliates, including, without
limitation, WALT DISNEY WORLD&#174; Resort and DISNEYLAND&#174; Resort
(<B>"Theme Park Admission Passes"</B>), at the prices and in
accordance with the terms and conditions set forth on <U>Schedule 9.9.1</U>. The
Theme Park Admission Passes shall only be available through the Facilities and
not the Internet Store. Licensee shall not offer for sale or sell within the
Facilities or the Internet Store or otherwise any admission tickets, passes or
other media for any Theme Park that is not owned, leased, licensed, controlled
and/or operated by TDSF or its Affiliates or that is not approved for sale by
TDSF hereunder in its sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.9.2 <U>Required
Product</U>. From time to time, at the request of TDSF or any of its Affiliates,
Licensee shall offer for sale, sell, market, advertise and promote in the
Facilities and the Internet Store such Other Disney Store Merchandise, Other
Licensee Merchandise and other consumer products and merchandise that bear,
feature or incorporate one (1) or more of the Disney Properties or other names,
brands, trademarks, logos, symbols, characters or other proprietary designations
or intellectual property of TDSF or its Affiliates as TDSF or its Affiliates may
select (collectively, the <B>"Required Product"</B>); <U>provided</U>,
that Licensee shall not be required to offer for sale, sell, market, advertise
or promote in the Facilities digital video discs or other home video products
pursuant to this Section&#160;9.9.2 (but, for purposes of clarification,
Licensee may be required to offer for sale, sell, market, advertise or promote
such products in the Internet Store pursuant to this Section&#160;9.9.2).
Notwithstanding anything to the contrary contained herein, TDSF shall determine,
in its sole discretion, the Facilities and/or the Internet Store in which
Required Product shall be so offered, the suggested retail price at which
Required Product shall be so offered, the amount and volume of Required Product
to be offered and the amount of space within each Facility and in the Internet
Store to be used for display and/or marketing and advertising of Required
Product, <U>provided</U>, that (i)&#160;the aggregate amount of space within
each Facility that TDSF may require Licensee to use for display and/or marketing
and advertising of Required Product (including, without limitation, shelf space,
end cap space, point-of-sale space, window display space and other store display
space) shall not exceed the amounts set forth in <U>Schedule 9.9.2</U> unless
otherwise requested or approved by Licensee, (ii)&#160;Licensee shall be
entitled to discontinue the offer and sale of any SKU of Required Product in the
Facilities and/or the Internet Store in the event that such SKU of Required
Product shall fail to achieve an inventory turn rate of at least one hundred
percent (100%) during any fifteen (15) week period following its introduction at
the Facilities and/or the Internet Store, as applicable (<U>provided</U>, that
Licensee shall determine such inventory turn rate in accordance with past
practice and shall provide TDSF with a reasonably detailed, written calculation
thereof that is satisfactory to TDSF in its business judgment) and, in any
event, Licensee may cease to offer and sell any SKU of Required Product in the
Facilities and/or the Internet Store on the date that is three (3) Retail Months
following its introduction at the Facilities and/or the Internet Store, as
applicable, and (iii) regardless of the price at which Licensee elects to sell
Required Product (which Licensee may determine in its sole discretion), the
Monthly Royalty Amounts for Required Product shall be based on the greater of
(x) the actual selling price of such Required Product or (y) the suggested
retail price for the Required Product as determined by TDSF in accordance with
this Section 9.9.2. TDSF further agrees that, except as Licensee may otherwise
agree, the initial suggested retail price for Required Product at the Facilities
and/or the Internet Store shall provide for a gross margin on the sale of such
Required Product at least equal to the average gross margin earned by Licensee
during the most recently completed twelve (12) Retail Months for the category of
merchandise into which such Required Product falls, as calculated by Licensee in
good faith and certified in writing by Licensee to TDSF. Licensee shall
determine the manner in which any Required Product will be marketed and
advertised in the Facilities, the Internet Store and/or in the general
marketplace, subject to the approval of TDSF in its business judgment. Any
Required Product that Licensee offers for sale, sells, markets, advertises or
promotes in accordance with this Section 9.9.2 shall be deemed to be Disney
Merchandise for purposes of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.9.3 <U>Advance Preview of
Motion Picture Properties and Television Properties</U>. At least eighteen (18)
months prior to the beginning of each calendar year during the Term (the
calendar year to which a presentation under this Section 9.9.3 relates is
referred to for purposes of this Section 9.9.3 as a <B>"Release
Year"</B>), or, if earlier, prior to or at approximately or near the same
time prior to a Release Year as such presentations are made to other major
consumer products licensees of TDSF and its Affiliates, at TDSF headquarters at
such times as the parties shall mutually agree, TDSF or its Affiliates shall
present to Licensee a general description of (including, to the extent
available, story summaries, story boards, style guides, film clips, character
drawings or animations and/or other artwork relating to) those Motion Picture
Properties and Television Properties that (i) feature or incorporate one (1) or
more of the Disney-Branded Properties or Non-Disney-Branded Properties (or any
properties that TDSF believes may be designated as Non-Disney-Branded Properties
hereunder), and (ii) are scheduled for release or distribution during such
Release Year; <U>provided</U>, that, with respect to the first (1<FONT SIZE=1>st</FONT>)
calendar year and, if there are not at least eighteen (18) months between the
Effective Date and the beginning of the second (2<FONT SIZE=1>nd</FONT>) calendar year,
then also with respect to the second (2<FONT SIZE=1>nd</FONT>) calendar year, TDSF or its
Affiliates shall make the presentation required by this Section 9.9.3 with
respect to the applicable Motion Picture Properties and Television Properties as
soon as reasonably practicable following the Effective Date. During each such
presentation, TDSF shall use its commercially reasonable efforts to provide
information regarding the relative popularity of the Disney Properties featured
in such presentation based upon ticket sales for the applicable Motion Picture
Properties, Nielsen ratings for the applicable Television Properties or other
comparable publicly available data to the extent available to TDSF in the
ordinary course of business. Following such initial presentation, during
meetings held at TDSF headquarters on a quarterly basis at such times as the
parties shall mutually agree, TDSF or its Affiliates shall provide Licensee with
updates regarding material changes to the matters covered by each such initial
presentation and shall, upon Licensee&#146;s request, provide Licensee with an
opinion regarding Licensee&#146;s ideas for the merchandising and/or promotion
in the Facilities and the Internet Store of the Disney Properties featured in
such initial presentation or quarterly update. Notwithstanding the foregoing,
TDSF and its Affiliates shall not be required to disclose to Licensee any
information that they are prohibited from disclosing pursuant to any Contract
binding on TDSF or its Affiliates or any of their properties, applicable Law or
the rules and regulations of any stock exchange on which TDSF&#146;s or any of
its Affiliates&#146; Securities are traded. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.9.4 <U>Coupons of TDSF
and its Affiliates</U>. Licensee shall accept and honor, as a valid method of
payment, throughout all of the Facilities and, as and to the extent requested by
TDSF and to the extent reasonably practicable, the Internet Store, for all
Disney Merchandise offered therein (or such portion thereof as may be designated
by TDSF from time to time), any coupon or comparable instrument offered by TDSF
or any of its Affiliates (<U>e.g.</U>, Walt Disney Records, Buena Vista Home
Entertainment); <U>provided</U>, that, with respect to any Disney Merchandise
purchased at the Facilities or the Internet Store with any such coupon or
instrument, TDSF or its Affiliates shall reimburse Licensee an amount equal to
the Purchase Price of such Disney Merchandise on such date, <U>minus</U> any
applicable sales Tax paid separately by the customer by means other than the
coupon or comparable instrument, discounts, rebates, refunds, credits,
allowances, adjustments and product returns, such reimbursement to be made on a
monthly basis within twenty (20) Business Days following Licensee&#146;s
delivery to TDSF of a reasonably detailed invoice therefor. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.9.5 <U>Acceptance
of Returned Merchandise From the Other Party&#146;s Stores</U>. Licensee shall,
at the Facilities, accept merchandise that was purchased by a customer from any
TDSF Flagship Store (including, as applicable, the El Capitan), any Designated
WDW Store, any Disney Retained Store (including, as applicable, the El Capitan),
any retail store described in Section 6.1.3, the DDM Business or any other store
(other than an Outlet Store or a Temporary Liquidation Store, which shall be
differentiated from other merchandise based on the sales receipt) offering
merchandise that bears, features or incorporates Disney-Branded Properties and
that is owned, leased, licensed, controlled and/or operated by TDSF or its
Affiliates or by a third party on their behalf within the Territory (each, a
"<B>TDSF/Affiliate Store</B>") and that the customer requests to return at the Facility
for a refund (a "<B>Licensee Reciprocal Return</B>"), and TDSF and its Affiliates
shall, at the TDSF/Affiliate Stores (other than the DDM Business), accept Disney
Merchandise that was purchased by a customer from a Facility or the Internet
Store and that the customer requests to return at the TDSF/Affiliate Store for a
refund (a "<B>Disney Reciprocal Return</B>"), in each case in accordance with the
following: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Each Facility and each TDSF/Affiliate Store shall be entitled to and shall
comply with its own ordinary course return policies (<U>e.g.</U>, pertaining to the
required condition of the merchandise, the availability of a sales receipt, the
permitted time period for returns, etc.) in connection with the acceptance of
any merchandise pursuant to a Licensee Reciprocal Return or a Disney Reciprocal
Return, respectively, and any attempted return of merchandise that does not
comply with such applicable return policies may be rejected by such store.
Customers whose returns are so rejected shall be informed that their return of
merchandise does not comply with the store's return policy and shall be directed
to the store at which such merchandise was purchased if they have additional
inquiries.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) TDSF shall, or
shall cause its Affiliates to, reimburse Licensee for all Licensee Reciprocal
Returns, and Licensee shall reimburse TDSF for all Disney Reciprocal Returns, in
each case in the full amount paid by the applicable party to the customer who
returned the merchandise. Within twenty (20) Business Days following the end of
each Retail Month during the Term, each of Licensee and TDSF shall deliver a
written invoice to the other party for the aggregate amount of Licensee
Reciprocal Returns and Disney Reciprocal Returns, respectively, incurred during
the preceding Retail Month, which invoices shall be due and payable within
twenty (20) Business Days following delivery thereof. Payments shall be made by
wire transfer of immediately available funds to accounts designated by Licensee
and TDSF.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) On a Retail
Monthly basis, all returnable merchandise (i.e., excluding merchandise for which
the original receipt is marked as "non-refundable") with a retail price of One
Hundred Twenty Five Dollars ($125) or more collected in connection with
merchandise returns under this Section 9.9.5 shall be returned to TDSF or
Licensee, as the case may be, at the cost of the original selling party, via
bulk mail to a single address to be designated by TDSF or Licensee, as the case
may be, and all merchandise with a retail price of less than One Hundred Twenty
Five Dollars ($125) collected in connection with such returns shall be either
(i) clearly marked as "customer return" and sold in the applicable store, with
the net proceeds of such sale to be netted against any reimbursements owed under
this Section 9.9.5 to the selling party by the party entitled to receive such
returned merchandise, or (ii) destroyed by the party who receives such returned
merchandise.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.9.6 <U>No Limitation on
Premiums by Third Parties</U>. Notwithstanding anything to the contrary
contained herein, Licensee acknowledges and agrees that there shall be no
limitation on the right of TDSF or its Affiliates to authorize any third Person,
including, without limitation, Strategic Alliance associates, to create,
develop, manufacture and distribute, as "premiums" on a free or
promotional basis, consumer products that bear, feature or incorporate one (1)
or more Disney Properties, notwithstanding the fact that such premiums may be
distributed through retail venues or other comparable channels of distribution
that may be competitive with the Business, the Facilities and the Internet
Store. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.9.7 <U>Requests for Assistance; Access to Archives</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Requests for
Assistance</U>. From time to time, Licensee may request that TDSF and/or its
Affiliates provide or arrange for the provision of creative and/or developmental
advice and/or assistance in connection with the operation of the Business. Upon
such request by Licensee, if TDSF and/or its Affiliates determine, in their sole
discretion based on their expertise in the applicable area, available resources,
the complexity of the task and other factors that TDSF and/or its Affiliates may
deem relevant, that it is feasible and appropriate to so provide or arrange for
such advice and/or assistance, TDSF and/or its Affiliates shall use commercially
reasonable efforts to do so. In the event that TDSF and/or its Affiliates so
provide or arrange for such advice and/or assistance, Licensee shall reimburse
TDSF and its Affiliates for their costs and expenses incurred in connection
therewith in accordance with the Allocated Cost Methodology. TDSF and/or its
Affiliates shall invoice Licensee monthly in arrears for the advice and/or
assistance provided pursuant to this Section 9.9.7, and Licensee shall pay TDSF
and/or its Affiliates for amounts due on each such invoice no later than twenty
(20) Business Days following delivery of such invoice by TDSF and/or its
Affiliates.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Access to
Archives and Website</U>. To the extent that TDSF or any of its Affiliates
maintains any Archives Location, TDSF shall, upon Licensee's request and during
normal business hours, provide Licensee and/or its Representatives with
reasonable access to such Archives Location and, in connection therewith, shall
make available for consultation with Licensee the employee of TDSF or its
Affiliates who is primarily responsible for maintaining or overseeing such
Archives Location; provided, that TDSF shall not be required to provide Licensee
such access or make available such employee on any date that is earlier than ten
(10) Business Days after such request by Licensee or on more than three (3)
occasions during any Contract Year (which, in the first (1st) Contract Year,
will include the Stub Period). In addition, to the extent that TDSF or any of
its Affiliates continue to maintain the licensee website located at
<U>www.disneylicensing.com</U> (or any substantially similar replacement or
successor website) and continue to provide access thereto to other major third
party manufacturing licensees of TDSF or its Affiliates, TDSF shall provide
Licensee with reasonable access thereto, subject to Licensee's execution and
delivery to TDSF of an access agreement relating thereto in form and substance
satisfactory to TDSF in its business judgment.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.9.8 <U>Cross-Marketing
Opportunities</U>. From time to time during the Term, upon the written request
of either party, which request shall contain, to the extent reasonably
practicable, a reasonably detailed proposal, each of TDSF and Licensee shall
consider and negotiate in good faith for a period of twenty (20) Business Days
(or such longer period of time as the parties may consent to in writing in their
respective sole discretion) regarding proposals by the other party to engage in
cross-marketing opportunities between or among the Facilities and the Business,
TCP and its "Children&#146;s Place" retail stores, and/or one (1) or
more Affiliates or business units of TWDC, <U>provided</U>, that (i) any such
cross-marketing opportunities shall be designed to provide approximately equal
benefits to all parties participating therein, (ii) each party to any such
negotiations shall be entitled to decide whether to enter into any such
cross-marketing opportunity in its respective sole discretion and may terminate
such good faith consideration or negotiation following such twenty (20) Business
Day period without recourse or remedy by the other party and without any
abatement or reduction of any payments or other obligations hereunder, (iii) any
agreement reached under this Section 9.9.8 shall be memorialized in a separate
written agreement, and (iv) neither party shall be required to consider or
negotiate more than four (4) cross-marketing proposals during any Contract Year
(which, in the first (1<FONT SIZE=1>st</FONT>) Contract Year, will include the Stub
Period). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.9.9 <U>Volume
Discounts</U>. From time to time, Licensee may request that TDSF and/or its
Affiliates permit or arrange for Licensee to participate in or benefit from
volume discounts or similar benefits that TDSF and/or its Affiliates may receive
within the Territory pursuant to arrangements with major shipping vendors or
overnight courier suppliers of TWDC (<U>e.g.</U>, TWDC&#146;s major overnight
courier service for deliveries in the United States). Upon such request by
Licensee, TDSF and/or its Affiliates and Licensee shall explore in good faith
the feasibility of extending to Licensee or otherwise allowing Licensee to
participate in or benefit from any such arrangements, <U>provided</U>, that (i)
any determination as to the feasibility of so extending such arrangements to
Licensee or otherwise allowing Licensee to participate therein or benefit
therefrom shall be made by TDSF and/or its Affiliates in their sole discretion
without recourse or remedy by Licensee and without any abatement or reduction of
any payments or other obligations of Licensee hereunder, and (ii) TDSF and/or
its Affiliates shall not be required to explore the feasibility of so extending
such arrangements to Licensee or otherwise allowing Licensee to participate
therein or benefit therefrom on more than one (1) occasion during any Contract
Year (which, in the first (1<FONT SIZE=1>st</FONT>) Contract Year, will include the Stub
Period). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.9.10
<U>Reciprocal Benefits for Employees</U>. During each Contract Year of the Term,
TDSF or its Affiliates agree to provide each person (other than a Silver Pass
Holder) who has been a Licensee Employee for a minimum of three (3) months with
a total of three (3) complimentary one-day, one-park passes for admission for
such Licensee Employee and two (2) guests of such Licensee Employee to a Theme
Park located in the Territory and owned, leased, licensed, controlled and/or
operated by or on behalf of TDSF and/or any of its Affiliates, in each case
subject to the following: (i) in order for any Licensee Employee to obtain such
Theme Park passes, Licensee shall be required to provide TDSF or its designated
Affiliate with twenty (20) Business Days prior written notice setting forth the
name of such Licensee Employee, the Theme Park that such Licensee Employee
intends to visit, the date on which such Licensee Employee intends to visit such
Theme Park and a statement certifying that such person is not a Silver Pass
Holder and has been a Licensee Employee for at least three (3) months, and (ii)
upon receipt of the notice pursuant to the preceding subparagraph (i), TDSF
shall or shall cause its Affiliate to make the respective Theme Park passes
available for pick-up at the applicable Theme Park on the date specified for the
visit (subject to black-out periods or other comparable restrictions applicable
to such complimentary Theme Park passes). Licensee shall be responsible for
ensuring compliance with the foregoing procedures and for taking such steps as
may be reasonably necessary to prevent any fraudulent or "gaming" behavior by
Licensee Employees in connection with such Theme Park passes and any Silver
Passes issued pursuant to Section 20.3 (<U>i.e.</U>, Licensee Employees selling
their Theme Park passes to other persons or providing them to other persons
rather than using them for their own benefit). Commencing in the fourth
(4<FONT SIZE=1>th</FONT>) Contract Year and on a periodic basis thereafter, TDSF and
Licensee shall review in good faith such compliance procedures to determine
their effectiveness and shall make such adjustments thereto as may be necessary
in TDSF&#146;s business judgment to avoid any such misconduct or misuse of the
Theme Park passes issued hereunder or otherwise to ensure that the procedures
followed under this Section 9.9.10 are effective and efficient. In the event
that, at any time during the Term, (i) Licensee ceases to provide employees of
TDSF and its Affiliates with a discount of at least thirty percent (30%) on
purchases of products within the Facilities and the Internet Store in the manner
contemplated by Section 9.4.3, or (ii) TDSF and/or its Affiliates cease to
provide such Theme Park passes to their employees for any reason, then in either
such case TDSF shall be entitled in its sole discretion to immediately cease
providing Theme Park passes to Licensee Employees pursuant to this Section
9.9.10 or otherwise. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.9.11 <U>Disney
Gift Cards and Stored Value Cards</U>. TDSF and/or certain of its Affiliates
have issued and/or may in the future issue Gift Cards, including, by way of
illustration and not limitation, a stored value card or gift card ("<B>Disney
Stored Value Cards</B>"), by which customers can store (<U>i.e.</U>, prepay) cash
value that can be redeemed for or used as a method of payment to purchase a
variety of products and services offered by TDSF and its Affiliates. In
connection with any and all Gift Cards, including Disney Stored Value Cards,
Licensee agrees that it shall: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Participate
from time to time, in accordance with TDSF's instructions, in marketing,
advertising or promotional activities pertaining to the acquisition, activation,
retention and usage of Gift Cards; <U>provided</U> that, with respect to marketing,
advertising or promotional activities under this subparagraph (a) in which
Licensee is required to participate without its approval or consent, TDSF shall,
or shall cause the issuer or administrator of the respective Gift Card or any
third Person to, reimburse Licensee for all documented, out-of-pocket, direct
advertising costs and expenses incurred by Licensee as a result of such
marketing, advertising or promotional activities (<U>e.g.</U>, the cost of in-store
collateral materials, newspaper advertising placements, billboards);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) In accordance
with TDSF's instructions, (a) accept and honor, as a valid method of payment,
throughout all of the Facilities and the Internet Store (except as otherwise
specified by TDSF in writing), for all Disney Merchandise offered therein (or
such portion thereof as may be designated by TDSF from time to time), any Gift
Card, and (b) install, maintain, support, modify and administer such information
technology and systems at or for the Facilities and the Internet Store as may be
reasonably requested by TDSF in order to enable the processing of transactions
with Gift Cards at the Facilities and the Internet Store in accordance with this
Section 9.9.11; provided, that, with respect to any Disney Merchandise purchased
at the Facilities or the Internet Store with a Disney Stored Value Card, TDSF or
its Affiliates shall reimburse Licensee an amount equal to the Purchase Price of
such Disney Merchandise on such date, minus (I) an amount equal to such
percentage of such Purchase Price as TDSF or its Affiliates may determine from
time to time in their sole discretion (such percentage, the "<B>Stored Value Card
Fee Rate</B>" and such amount, the "<B>Stored Value Card Fee</B>"), provided, that the
Stored Value Card Fee Rate (x) shall not exceed, by any material amount, the
percentage of the Purchase Price of consumer products and merchandise purchased
from third party licensees of TDSF or its Affiliates with a Disney Stored Value
Card that is deducted from the amount reimbursable to such third party
licensees, and (y) with respect to Licensee, shall not in any event exceed two
percent (2%) of the Purchase Price of the applicable Disney Merchandise on the
applicable date, and (II) any applicable sales Tax paid separately by the
customer by means other than the Disney Stored Value Card, discounts, rebates,
refunds, credits, allowances, adjustments and product returns, such
reimbursement to be made on a monthly basis within twenty (20) Business Days
following Licensee's delivery to TDSF of a reasonably detailed invoice
therefor;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) Upon TDSF's
request, in accordance with TDSF's instructions, (i) issue, throughout all of
the Facilities and, as applicable, the Internet Store, any Gift Card, (ii)
install, maintain, support, modify and administer such information technology
and systems at or for the Facilities and the Internet Store as may be reasonably
requested by TDSF in order to enable the issuance of Gift Cards at the
Facilities and, as applicable, the Internet Store in accordance with this
Section 9.9.11, (iii) with respect to any Disney Stored Value Cards that are
issued by Licensee, remit the proceeds thereof to such Affiliate of TDSF as TDSF
shall designate from time to time, and (iv) with respect to any Gift Cards other
than Disney Stored Value Cards that are issued by Licensee, remit the proceeds
thereof in such manner as TDSF shall designate from time to time, in the case of
each of subparagraphs (i), (ii), (iii) and (iv) on such terms as TDSF may
reasonably request;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) Upon TDSF's
request, provide (not more than once per Retail Month) to TDSF and its
Affiliates information regarding the volume of purchases at the Facilities and
the Internet Store made with Gift Cards, separately identifying Disney Stored
Value Cards;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) If not done
prior to the Effective Date, enter into a participation agreement, including,
without limitation, a ValueLink Participation Agreement (or any amendment,
modification or replacement thereof), pursuant to which Licensee shall
participate in any Disney Stored Value Card program operated or administered by
a third party, on such terms as TDSF and Licensee shall approve in their
respective business judgment, such approval of TDSF to be obtained in accordance
with Section 9.19.3;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) Comply with
such program rules and regulations with respect to Gift Cards, including the
Disney Stored Value Cards, as may be in effect from time to time during the
Term; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) Take or refrain
from taking such additional actions as TDSF may reasonably request in connection
with the issuance and acceptance of Gift Cards (<U>provided</U> that, if any such
additional actions result in the imposition on Licensee of any obligations
materially more onerous than those set forth in the preceding subparagraphs (a)
through (f), inclusive, TDSF shall reimburse Licensee for its actual, reasonable
costs and expenses incurred or suffered as a result thereof).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.9.12 <U>TDSF
Reproduction Rights</U>. Notwithstanding any other provisions of this Agreement,
TDSF and its Affiliates shall have the royalty-free right, without obtaining the
approval of Licensee, to photograph, take videos or motion pictures of, televise
or otherwise reproduce in any manner or through any media (such photographs,
videos, motion pictures, televising or other reproductions, collectively,
"<B>Reproductions</B>") any of the Facilities, the Internet Store or any parts thereof
for the general business or marketing purposes of TDSF and/or its Affiliates
(<U>e.g.</U>, a presentation to financial analysts that features a variety of
the operations of TDSF and its Affiliates, such as their Theme Park and filmed
entertainment businesses, together with information regarding the Facilities and
the Internet Store). Such right shall include the right to use, on a
royalty-free basis, Licensee&#146;s and TCP&#146;s name as the operator of the
Facilities and the Internet Store. TDSF may display, use, sell, license or
otherwise exploit any such Reproductions for any purpose, commercial or
otherwise, both during the Term and after the expiration or earlier termination
of this Agreement and all of the foregoing materials and all benefits and
revenues obtained therefrom shall be the sole and exclusive property of TDSF and
its Affiliates. Upon TDSF&#146;s reasonable request, and at Licensee&#146;s
expense, Licensee shall use its commercially reasonable efforts to obtain, for
TDSF&#146;s benefit, releases, clearances or other instruments from any Licensee
Employees or otherwise as may be necessary to permit TDSF to make and use or
cause to be made and used any such Reproductions. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.10    <U> Access and Right to Cure</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.10.1 <U>Monitoring and
Inspection</U>. At any time and from time to time, during normal business hours,
with or without notice to Licensee, TDSF, its Affiliates or its Representatives
shall be entitled to inspect and monitor the Business Properties and, upon three
(3) Business Days advance notice, interview a reasonable number of Licensee
employees to ensure that the Business Properties are being maintained, and the
Business is being conducted, and the Licensed Materials are being used,
displayed and reproduced, in a high quality manner that is at least equal to the
quality levels prevailing among full-priced specialty retail chains focused on
children&#146;s consumer products and in compliance with this Agreement, the
Operating Manual, any applicable Lease Agreements and applicable Law, and
Licensee shall provide TDSF, its Affiliates and its Representatives with access
to all such Business Properties and personnel in order to enable TDSF, its
Affiliates and its Representatives to conduct such inspection and monitoring.
Such inspection may include, without limitation, review of customer surveys, the
review of customer correspondence, such as complaints, with respect to Disney
Merchandise and the operation of the Facilities and the Internet Store, and,
upon three (3) Business Days advance notice, interviews with a reasonable number
of Licensee employees and management. In connection with such inspections, TDSF
shall use its commercially reasonable efforts not to disrupt in any material
respect the day-to-day operations of Licensee or any Business Property being
inspected. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.10.2 <U>TDSF Self-Help
Cure</U>. In the event that (a) TDSF determines that (i)&#160;the Business is
being conducted, or any Business Property is being maintained, repaired,
refurbished or operated, by Licensee in any manner that is not in strict
compliance with this Agreement, the Operating Manual, the terms of any
applicable Lease Agreement or any applicable Law, (ii) Licensee has committed
any Licensee Infringing Use or other misuse of any of the names, brands,
trademarks, logos, symbols, characters or other proprietary designations or
intellectual property of TDSF or its Affiliates, (iii) Licensee is in material
breach of any Lease Agreement or other material Contract entered into by
Licensee in connection with the operation of the Business, (iv) Licensee has
materially breached any of its other obligations and duties under this Agreement
or any other Contract with TDSF or its Affiliates entered into by Licensee in
connection herewith (including, without limitation, any Royalty Breach), or (v)
any other action or omission of Licensee at or with respect to any Facility, as
identified and determined by TDSF in its sole discretion, requires corrective or
remedial measures, even if such action or omission does not constitute
non-compliance, infringement, misuse or breach as described under the preceding
subparagraphs (i), (ii), (iii) and (iv), and (b) following written notice from
TDSF to Licensee of any such non-compliance, infringement, misuse, breach,
action or omission, Licensee shall fail to Cure or otherwise correct such
non-compliance, infringement, misuse, breach, action or omission in a timely
manner (which shall not exceed (A) in the case of the preceding subparagraph
(i), (ii), (iii) or (iv), the lesser of any time period specified in this
Agreement or twenty (20) Business Days following written notice if not so
specified (and, if not so specified and such 20-Business-Day period applies, if
such Cure or other correction cannot reasonably be accomplished to TDSF&#146;s
satisfaction in its business judgment within such 20-Business-Day period, then
Licensee shall in good faith have commenced such Cure or other correction within
such 20-Business-Day period and shall thereafter have proceeded diligently to
complete such Cure or other correction to TDSF&#146;s satisfaction in its
business judgment within twenty-five (25) Business Days following such written
notice from TDSF to Licensee) or (B) in the case of the preceding subparagraph
(v), seven (7) Business Days following written notice (and, if such Cure or
other correction cannot reasonably be accomplished to TDSF&#146;s satisfaction
in its business judgment within such 7-Business-Day period, then Licensee shall
in good faith have commenced such Cure or other correction within such
7-Business-Day period and shall thereafter have proceeded diligently to complete
such Cure or other correction to TDSF&#146;s satisfaction in its business
judgment within ten (10) Business Days following such written notice from TDSF
to Licensee), then TDSF, its Affiliates and its Representatives shall have the
right, but not the obligation, to correct or cure any such non-compliance,
infringement, misuse, breach or other action or omission in such manner as TDSF
shall deem appropriate in its sole discretion (each, a "<B>TDSF Self-Help
Cure</B>"); <U>provided</U>, that TDSF shall not undertake any TDSF Self-Help
Cure described in the preceding subparagraph (v) with respect to any action or
omission that does not constitute non-compliance, infringement, misuse or breach
hereunder on more than two (2) occasions during the Stub Period or more than
five (5) occasions in any Contract Year. In connection with any such TDSF
Self-Help Cure, Licensee shall, upon two (2) Business Days&#146; written notice
from TDSF, (x) provide TDSF, its Affiliates and Representatives with full access
to any Business Property or Business Properties designated by TDSF for purposes
of conducting such TDSF Self-Help Cure for so long as TDSF may require, (y)
issue such directions and instructions to Licensee&#146;s employees, management,
Affiliates, Representatives and Manufacturers as TDSF shall request in order to
accomplish such TDSF Self-Help Cure and, if Licensee shall fail to issue any
such directions or instructions within two (2) Business Days following
TDSF&#146;s request, Licensee hereby designates TDSF as Licensee&#146;s true and
lawful attorney-in-fact and agent, for Licensee and in Licensee&#146;s name,
place and stead, in any and all capacities, to issue such directions and
instructions to Licensee&#146;s employees, management, Affiliates,
Representatives and Manufacturers, and (z) take such other actions as TDSF may
request in order to enable TDSF to perform such TDSF Self-Help Cure. In addition
to the foregoing, either party shall be entitled to refer any non-compliance,
infringement, misuse or breach issues specified in subparagraph (i), (ii), (iii)
or (iv) of this Section 9.10.2 to the Joint Advisory Committee, <U>provided</U>,
that no decision of the Joint Advisory Committee with respect thereto shall in
any manner limit the rights or duties of the parties hereunder. No action taken
hereunder by or on behalf of TDSF shall in any manner limit or restrict any
other right or remedy available to TDSF under this Agreement or at law or in
equity or in any manner impose upon TDSF any additional obligations or
responsibilities not expressly set forth in this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.10.3   <U>TDSF Self-Help Fund</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Funding</U>.
Prior to or on the Effective Date, Licensee has either (i) delivered the TDSF
Self-Help Fund Amount in cash to an escrow agent reasonably acceptable to TDSF
in order to fund an escrow account in accordance with an escrow agreement
substantially in the form of <U>Schedule 9.10.3(a)</U>, under which escrow agreement
Licensee is obligated to continue to provide additional funds as necessary from
time to time to maintain on a continuous basis an amount in cash in such account
equal to the TDSF Self-Help Fund Amount (as the same may be increased from time
to time in accordance with this Section 9.10.3), or (ii) entered into an
irrevocable letter of credit in favor of and for the benefit of TDSF with an
availability equal to the TDSF Self-Help Fund Amount with a bank or other
financial institution and on terms that are reasonably acceptable to TDSF, which
irrevocable letter of credit shall be renewed, amended or otherwise modified by
Licensee as necessary from time to time to maintain on a continuous basis an
availability thereunder equal to the TDSF Self-Help Fund Amount (as the same may
be increased from time to time in accordance with this Section 9.10.3) (such
escrow account funds or irrevocable letter of credit availability as provided
under either of the preceding subparagraphs (i) and (ii), the "<B>TDSF Self-Help
Fund</B>"). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Use of
Fund</U>. Licensee acknowledges and agrees that the TDSF Self-Help Fund may be
drawn upon only by TDSF (and not by Licensee) from time to time (without TDSF
being required to seek or obtain any consent or authorization whatsoever from
Licensee) for the purposes of (i) reimbursing TDSF, its Affiliates and
Representatives for any and all costs and expenses incurred by any of them from
time to time in connection with any TDSF Self-Help Cure described in
subparagraph (i), (ii), (iii) or (iv) of Section 9.10.2, (ii) reimbursing TDSF,
its Affiliates and Representatives for any and all reasonable costs and expenses
incurred by any of them from time to time in connection with any TDSF Self-Help
Cure described in subparagraph (v) of Section 9.10.2, (iii) paying TDSF any
Licensee Infringement/Breach Fee that is due and owing to TDSF and that has not
been paid by Licensee to TDSF by the second (2nd) Business Day following written
notice from TDSF to Licensee that such Licensee Infringement/Breach Fee was not
paid on the date specified by Section 21.24, and/or (iv) reimbursing TDSF for
any amount for which Licensee is required to provide indemnification pursuant to
Section 12.1 if such indemnification is not paid by Licensee in accordance with
the terms of Section 12 by the fifth (5th) Business Day following written notice
from TDSF to Licensee of such non-payment. Costs and expenses incurred by TDSF,
its Affiliates and Representatives in connection with any TDSF Self-Help Cure
shall be billed against the TDSF Self-Help Fund in accordance with the Allocated
Cost Methodology. TDSF's use of the TDSF Self-Help Fund shall not in any manner
limit or restrict any other right or remedy available to TDSF under this
Agreement or at law or in equity. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>TDSF
Self-Help Fund Amount and Adjustments</U>. The term "<B>TDSF Self-Help Fund Amount</B>"
shall mean (i) for the Stub Period, Two Million Dollars ($2,000,000), (ii) for
the first (1st) Contract Year, Two Million Dollars ($2,000,000), and (iii) for
the second (2nd) Contract Year and continuing through each and every Contract
Year of the Term thereafter, an amount equal to the TDSF Self-Help Fund Amount
for the immediately preceding Contract Year adjusted to reflect the increase, if
any, in the CPI in accordance with the CPI Adjustment Methodology. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.11     <U>Reporting Obligations</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.11.1 <U>Monthly Sales and
Operating Statements</U>. Not later than twenty (20) Business Days after the end
of each Retail Month during the Term, Licensee shall furnish to TDSF a detailed
statement setting forth pertinent data relating to the operating performance of
the Facilities and the Internet Store during the preceding Retail Month,
including, without limitation, information regarding (i)&#160;total revenues and
Net Retail Sales generated by the Facilities and the Internet Store, reported in
the aggregate, by Facility and the Internet Store, by merchandise category and
by SKU, (ii)&#160;revenue generated from the sale in the Facilities and the
Internet Store of Other Disney Store Merchandise, Other Licensee Merchandise and
BVHE Merchandise, (iii)&#160;revenue generated in the Facilities and the
Internet Store from the sale of Disney Merchandise to (a)&#160;TDSF or any of
its Affiliates and (b)&#160;employees of each of Licensee, TDSF and their
respective Affiliates, in the aggregate, (iv)&#160;the amount of any Taxes on
the manufacture, distribution or sale of Disney Merchandise, (v)&#160;the amount
and type of any and all other sources of revenue, (vi)&#160;capital expenditures
incurred during such Retail Month, (vii)&#160;marketing expenses incurred during
such Retail Month, (viii) commissions from the sale of Theme Park Admission
Passes and (ix)&#160;the amount of purchases made using each of Visa Payment
Service Products, Disney&#146;s Visa Card, the Monogram-Disney Card and Disney
Stored Value Cards. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.11.2 <U>Quarterly
Financial Information</U>. Licensee shall deliver to TDSF, as soon as
practicable after the end of each of the first three (3) Fiscal Quarters of
Licensee&#146;s Fiscal Year, and in any event within twenty (20) Business Days
after the end of each such Fiscal Quarter, true and complete copies of the
unaudited consolidated balance sheets, and the related consolidated statements
of income, stockholders&#146; equity and cash flows, of each of TDS USA and TDS
Canada and their respective Subsidiaries as well as of Licensee and its
Subsidiaries on a consolidated basis as at the close of such Fiscal Quarter and
covering operations for such Fiscal Quarter and, in the case of Fiscal Quarters
after the first Contract Year, setting forth in each case in comparative form
the figures for the comparable period of the previous Fiscal Year. All such
financial statements (i)&#160;shall be prepared in accordance with GAAP (except
for the omission of normal year-end adjustments and footnote disclosures)
consistently applied throughout the periods involved, (ii)&#160;shall be true
and correct in all material respects, and (iii)&#160;shall fairly present the
financial condition, income, changes in stockholders&#146; equity and cash flow
of TDS USA, TDS Canada and/or Licensee, as the case may be, on a consolidated
basis, as applicable, as of the respective dates thereof and for the respective
periods covered thereby. All such financial statements delivered hereunder shall
be accompanied by a certificate of compliance, executed by the Chief Financial
Officer of Licensee or a senior executive financial officer of Licensee with
knowledge of or responsibility for the matters being certified, certifying that
(a) such financial statements are being delivered pursuant to and in accordance
with this Section&#160;9.11, (b)&#160;Licensee is in compliance with this
Agreement, including, without limitation, with respect to Refurbishments and the
material terms of each Lease Agreement, and (c)&#160;whether, if this Agreement
were up for renewal pursuant to Section&#160;2.2.1 as of the end of the
applicable Fiscal Quarter of Licensee (as if the end of such Fiscal Quarter were
the end of a Fiscal Year), Licensee would then be in compliance with the
Financial Covenant pursuant to Section&#160;2.2.1(e) (with a compliance report
setting forth in detail the appropriate calculation for the Financial Covenant).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.11.3 <U>Annual
Financial Information</U>. Licensee shall deliver to TDSF, as soon as
practicable after the end of each of Licensee&#146;s Fiscal Years, and in any
event within forty (40) Business Days after the end of each such Fiscal Year,
true and complete copies of the unaudited consolidated balance sheets of each of
TDS USA and TDS Canada and their respective Subsidiaries as well as of Licensee
and its Subsidiaries on a consolidated basis as at the end of such Fiscal Year,
the consolidated statements of income of such parties for such Fiscal Year
(together with statements of income for each individual Facility for such Fiscal
Year on a Facility-by-Facility basis and a reconciliation of such individual
Facility statements of income to the consolidated statements of income of TDS
USA, TDS Canada and Licensee), and stockholders&#146; equity and cash flows of
such parties for such Fiscal Year and, in the case of Fiscal Years after the
First Contract Year, setting forth in each case in comparative form the figures
for the previous Fiscal Year, all in reasonable detail. All such financial
statements (i) shall be prepared in accordance with GAAP consistently applied
throughout the periods involved, (ii) shall be true and correct in all material
respects, and (iii) shall fairly present the financial condition, income,
changes in stockholders&#146; equity and cash flow of such parties and their
respective Subsidiaries on a consolidated basis, as applicable on the respective
dates thereof and for the respective periods covered thereby. All such financial
statements delivered hereunder shall be accompanied by a certificate of
compliance, executed by the Chief Financial Officer of Licensee or a senior
executive financial officer of Licensee with knowledge of or responsibility for
the matters being certified, certifying that (i) such financial statements are
being delivered pursuant to and in accordance with this Section&#160;9.11,
(ii)&#160;Licensee is in compliance with this Agreement, including, without
limitation, with respect to Refurbishments and the material terms of each Lease
Agreement, and (iii)&#160;whether, if this Agreement were up for renewal
pursuant to Section&#160;2.2.1 as of the end of the applicable Fiscal Year,
Licensee would then be in compliance with the Financial Covenant pursuant to
Section&#160;2.2.1(e) (with a compliance report setting forth in detail the
appropriate calculation for the Financial Covenant). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.11.4 <U>Liquidity
Plan</U>. Licensee shall deliver to TDSF, as soon as practicable after the end
of each of Licensee&#146;s second (2<FONT SIZE=1>nd</FONT>) and fourth (4<FONT SIZE=1>th</FONT>)
Fiscal Quarters during each Fiscal Year of Licensee, and in any event within
twenty (20) Business Days after the end of each such Fiscal Quarter, a list
setting forth Licensee&#146;s internal and external sources of liquidity,
including, without limitation, the source or provider, type, material terms and
amount of each such source of liquidity (the "<B>Liquidity Plan</B>"), for the
two (2) year period beginning on the first (1<FONT SIZE=1>st</FONT>) day of such Fiscal
Quarter (the "<B>Liquidity Period</B>"), in substantially the same format as the
liquidity plan that was provided by Licensee&#146;s Affiliates pursuant to the
Acquisition Agreement, subject to such reasonable changes thereto as TDSF may
request from time to time. Licensee shall not accept or use, and shall cause its
Affiliates not to accept or use, as a source of liquidity, any funds
contributed, provided or otherwise made available to Licensee or any of its
Affiliates by any Disqualified Person, directly or indirectly, in connection
with the Liquidity Plan. The Liquidity Plan delivered hereunder shall be
accompanied by a certificate of compliance, executed by the Chief Financial
Officer of Licensee or a senior executive financial officer of Licensee with
knowledge of or responsibility for the matters being certified, certifying that
(i) such Liquidity Plan is being delivered pursuant to and in accordance with
this Section 9.11, (ii) such Liquidity Plan is true, correct and accurate in all
material respects, (iii) no provider of liquidity under such Liquidity Plan is a
Disqualified Person, and (iv) he or she reasonably believes the sources of
liquidity set forth in such Liquidity Plan will be sufficient in the aggregate
to meet Licensee&#146;s expected operating needs, capital expenditures and Tax
obligations during the applicable Liquidity Period. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.11.5 <U>Tax Returns</U>.
Licensee shall provide TDSF with a copy of the final version of all United
States federal income Tax Returns pertaining to the Business and Licensee and
its Subsidiaries in the form filed with the Internal Revenue Service within ten
(10) Business Days after the actual filing thereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.11.6 <U>SEC Filings</U>.
As soon as reasonably practicable prior to the filing thereof with the SEC or
any other Governmental Entity, Licensee shall provide TDSF with a draft copy of
all filings made by any Licensee Entity and/or any TCP Entity under the
Securities Act, the Securities Exchange Act, any other federal or state
securities Laws or otherwise with the SEC, including, without limitation, any
registration statements (and all amendments or supplements thereto), periodic
filings under the Securities Exchange Act, applications for admission and
reports to any securities exchange, stock market or other securities trading
system, and all correspondence with the SEC or relating to any of the foregoing
filings (collectively, "<B>Securities Filings</B>"); <U>provided</U>
that, (i) for any report or filing (such as a Form 8-K) other than a periodic
report on Form 10-Q or 10-K, the annual report to shareholders, the annual proxy
statement and any other periodic or regular filings (or any replacement of any
of the foregoing), Licensee shall only be required to use commercially
reasonable efforts to provide such securities filings prior to the filing
thereof with the SEC or any other Governmental Entity, and (ii)&#160;with
respect to Securities Filings by TCP Entities, Licensee shall only be required
to provide a draft copy of the portions of such filings that relate to any
Licensee Entity, any Licensee Securities, any Licensee Affiliate Securities
and/or the Business. Licensee shall or shall cause its Affiliates to consider in
good faith any comments of TDSF with respect to such Securities Filings,
provided that no comment made by TDSF with respect to any such Securities
Filings shall constitute a representation or warranty by TDSF with respect to
the legality thereof and under no circumstances whatsoever shall TDSF have any
liability with respect to such Securities Filings. Licensee shall also provide
TDSF with a copy of the final version, as filed, of all such Securities Filings
within three (3) Business Days after the actual filing thereof. Licensee shall
ensure that all Securities Filings are timely filed with the appropriate
Governmental Entity, and Licensee represents and warrants to TDSF that no such
Securities Filings shall contain any untrue statement of a material fact or any
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading. In connection with any offering of any
Licensee Securities or Licensee Affiliate Securities, Licensee shall, in
addition to the Securities Filings identified above, provide TDSF with such
additional reports, records and information and access to Licensee&#146;s or its
Affiliates&#146; officers, directors, underwriters, financial advisors,
accountants, counsel and other advisors in connection therewith, in each case as
TDSF may reasonably request. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.11.7 <U>Other
Information</U>. In addition to the statements, information and Tax Returns
required by this Section&#160;9.11, Licensee shall deliver to TDSF, promptly
following TDSF&#146;s request, such other documents, reports, data and
information as TDSF may from time to time reasonably request. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.11.8 <U>Form of
Delivery</U>. All of Licensee&#146;s reports, statements and other information
delivered pursuant to this Section&#160;9.11 shall be made in a form and manner
and in media (<U>e.g.</U>, paper, electronic format) reasonably satisfactory to
TDSF (subject to the provisions of Section 9.11.4). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.12     <U>Organizational Structure</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.12.1 <U>Maintenance of
Corporate Organization</U>. After the Effective Date, during the Term, without
the prior written approval of TDSF in its business judgment, which approval
shall be sought in each instance in accordance with the approval provisions set
forth in Section 9.19.3: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Licensee shall
not, and shall not agree to, (i) reorganize itself or any of its Subsidiaries
(including Canadian Parent) into a different jurisdiction or a different form of
entity or otherwise alter the organizational structure of itself or any of its
Subsidiaries (including Canadian Parent), (ii) create or otherwise acquire any
direct or indirect Subsidiary or dissolve or otherwise dispose of any of its
direct or indirect Subsidiaries (including Canadian Parent), (iii) issue any
equity Securities (including, without limitation, any Securities convertible
into or exercisable or exchangeable for equity Securities) of any of its direct
or indirect Subsidiaries (including Canadian Parent), other than to Licensee
Parent, Licensee or Canadian Parent or pursuant to a Permitted Transfer, (iv)
except in connection with the incurrence or guarantee of Indebtedness by
Licensee or any of its Subsidiaries (including Canadian Parent) in accordance
with the terms of this Agreement (including, without limitation, Section 9.17.2,
Section 9.17.3 and subparagraphs (c) and (d) of Section 9.13.3, if applicable),
Transfer or otherwise change the manner in which it or any of its Subsidiaries
(including Canadian Parent) holds any Lease Agreement or any of its material
assets (whether voluntarily or by operation of law), or (v) amend, modify,
restate or replace any of its or its Subsidiaries' Governing Documents
(including the Governing Documents of Canadian Parent); <U>provided</U>, that,
notwithstanding subparagraph (i) of this Section 9.12.1(a):</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (I) On or within
twenty (20) Business Days following the Effective Date, TDS USA shall be
permitted to merge with and into a limited liability company to be named "Hoop
Retail Stores, LLC" and newly formed for such sole purpose by, and as a wholly
owned Subsidiary of, Licensee Parent under the laws of the State of Delaware,
which limited liability company shall have no material assets, operations or
liabilities prior to such merger and shall be a sister company of TDS USA prior
to such merger such that, following such merger, TDS USA shall remain a wholly
owned Subsidiary of Licensee Parent as a Delaware limited liability company (the
"<B>TDS USA Merger</B>") without the prior written approval of TDSF so long as (w) such
TDS USA Merger complies with all applicable Laws, (x) in connection with such
TDS USA Merger, Licensee does not amend, modify, restate or replace any of TDS
USA's Governing Documents except with such changes as TDSF may approve in its
business judgment and except as and to the extent required by applicable Laws,
(y) none of the documents or instruments used and/or filed by TDS USA in
connection with such TDS USA Merger conflicts with, violates or breaches any
provision of this Agreement, and (z) following the TDS USA Merger, the Entity
that survives the TDS USA Merger, as the successor to TDS USA, shall be and be
deemed to be "TDS USA" and a "Licensee" for all purposes of this Agreement,
bound hereby to the same extent and in the same manner as if it were the
original TDS USA that executed this Agreement; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (II) On or within
twenty (20) Business Days following the Effective Date, TDS Canada and Canadian
Limited Partner may form a limited partnership under the laws of the Province of
Ontario ("<B>New Canadian Limited Partnership</B>") of which TDS Canada will be and at
all times will remain the sole general partner and Canadian Limited Partner will
be and at all times will remain the sole limited partner, provided that (A) all
documents pertaining to the formation of Canadian Limited Partner and New
Canadian Limited Partnership, including, without limitation, each of their
respective Governing Documents, shall comply with applicable Laws, shall not
conflict with, violate or breach any provision of this Agreement and shall have
been approved in writing by TDSF in its business judgment prior to the formation
of Canadian Limited Partner and New Canadian Limited Partnership, respectively,
(B) on the effective date of the formation of New Canadian Limited Partnership,
TDS USA and TDS Canada shall, and shall cause New Canadian Limited Partnership
and Canadian Limited Partner to, execute and deliver to TDSF a Joinder Agreement
in the form set forth in <U>Schedule 9.12.1(a)</U> (the "<B>Canadian Joinder</B>"), and (C)
following New Canadian Limited Partnership's, Canadian Limited Partner's, TDS
USA's and TDS Canada's execution and delivery to TDSF of the Canadian Joinder,
(1) the term "TDS Canada" as used herein shall be deemed to refer individually
and collectively to both TDS Canada and New Canadian Limited Partnership, each
of which shall be jointly and severally liable for all of the duties and
obligations of "TDS Canada" hereunder, (2) the term "Licensee" as used herein
shall be deemed to refer individually and collectively to TDS USA, TDS Canada
and New Canadian Limited Partnership, each of which shall be jointly and
severally liable for all of the duties and obligations of "Licensee" hereunder
as set forth in Section 21.26, (3) the term "Canadian Parent" as used herein
shall be deemed to refer individually and collectively to both Canadian Parent
and Canadian Limited Partner, with the provisions hereof that are applicable to
Canadian Parent to be equally applicable in all respects to Canadian Limited
Partner, and (4) the Business conducted within Canada may be owned, leased,
licensed, controlled and operated by TDS Canada or New Canadian Limited
Partnership or both of them, as they shall determine in their respective sole
discretion, subject in each case to the terms and conditions of this Agreement
applicable to TDS Canada and Licensee; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (III) On or within
twenty (20) Business Days following the Effective Date (except that such date
may be extended if and only to the extent that any action taken, or failed to be
taken, in error by TDSF or its Affiliates on or prior to the Effective Date
renders it impossible to effect such continuation within such twenty (20)
Business-Day period, in which event, if applicable, Licensee shall be obligated
to correct such error and effect such continuation as soon as reasonably
practicable following the Effective Date), TDS Canada shall be permitted to be
continued under the laws of the province of New Brunswick, Canada, by way of an
amalgamation with Hoop Canada, Inc., a corporation incorporated under the laws
of the Province of New Brunswick that will be the survivor of such amalgamation
(the "<B>Canada Reincorporation</B>" and the date on which the Canada Reincorporation
occurs, the "<B>Canada Reincorporation Date</B>"), without the prior written approval
of TDSF so long as (w) such Canada Reincorporation complies with all applicable
Laws, (x) in connection with such Canada Reincorporation, Licensee does not
amend, modify, restate or replace any of TDS Canada's Governing Documents except
with such changes as TDSF may approve in its business judgment and except as and
to the extent required by applicable Laws, (y) none of the documents or
instruments used and/or filed by TDS Canada in connection with such Canada
Reincorporation conflicts with, violates or breaches any provision of this
Agreement, and (z) following the Canada Reincorporation, the Entity that
survives the Canada Reincorporation, as the successor to TDS Canada, shall be
and be deemed to be "TDS Canada" and a "Licensee" for all purposes of this
Agreement, bound hereby to the same extent and in the same manner as if it were
the original TDS Canada that executed this Agreement; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) Licensee shall
not cause or permit Licensee Parent or TCP to (i) reorganize Licensee Parent or
any of its Subsidiaries into a different jurisdiction or a different form of
entity or otherwise alter the organizational structure of Licensee Parent or any
of its Subsidiaries, (ii) create or otherwise acquire any direct or indirect
Subsidiary or dissolve or otherwise dispose of any direct or indirect Subsidiary
of Licensee Parent, (iii) issue any equity Securities (including, without
limitation, any Securities convertible into or exercisable or exchangeable for
equity Securities) of any of Licensee Parent's direct or indirect Subsidiaries,
other than to Licensee Parent or pursuant to a Permitted Transfer, (iv) except
in connection with the incurrence or guarantee of Indebtedness by Licensee
Parent (to the extent TDSF approves any such incurrence or guarantee pursuant to
Section 9.17.3) or any of Licensee Parent's Subsidiaries in accordance with the
terms of this Agreement (including, without limitation, subparagraphs (c) and
(d) of Section 9.13.3, if applicable), Transfer or otherwise change the manner
in which Licensee Parent or any Subsidiary of Licensee Parent holds any of its
assets (whether voluntarily or by operation of law), or (v) amend, modify,
restate or replace any of Licensee Parent's Governing Documents or the Governing
Documents of any of Licensee Parent's Subsidiaries; <U>provided</U>, that references in
this subparagraph (b) of this Section 9.12.1 to Subsidiaries of Licensee Parent
shall not include Licensee or Licensee's Subsidiaries (including Canadian
Parent), which shall be governed by subparagraph (a) of this Section 9.12.1;
and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) In any case
where any of the following matters or actions would reasonably be expected to
have a material adverse effect on Licensee or the Business, Licensee shall not
cause or permit TCP to (i) reorganize TCP or any TCP Entity into a different
jurisdiction or a different form of entity or otherwise alter the organizational
structure of TCP or any TCP Entity, (ii) create or otherwise acquire, or
dissolve or otherwise dispose of, any TCP Entity, (iii) issue any equity
Securities (including, without limitation, any Securities convertible into or
exercisable or exchangeable for equity Securities) of any TCP Entity, other than
pursuant to a Permitted Transfer, (iv) Transfer or otherwise change the manner
in which TCP or any TCP Entity holds any of its material assets relating to or
used in connection with the Business (whether voluntarily or by operation of
law), or (v) amend, modify, restate or replace any of TCP's Governing Documents
or the Governing Documents of any TCP Entity.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.12.2 <U>Transactions with
TCP or its Affiliates</U>. Notwithstanding anything to the contrary set forth in
Section 9.12.1, Licensee shall not, and shall not cause or permit any other
Licensee Entity to, enter into any transaction involving the sale, merger,
consolidation, reorganization or other business combination (including any asset
sale) of any Licensee Entity with or into TCP or any of its Affiliates without
the prior written approval of TDSF in its sole discretion, unless, following
such transaction, (i) all Securities of TDS USA and TDS Canada (or their
respective successors) will be solely owned by Licensee Parent and Canadian
Parent, respectively (or their respective successors), (ii) Licensee Parent and
Canadian Parent (or their respective successors) will have no Subsidiaries
(other than TDS USA and TDS Canada, respectively, or their respective
successors) nor any other debt or equity investments in any other Person (other
than Securities of TDS USA and TDS Canada, respectively (or their respective
successors)) and will have no business, assets or operations other than holding
all outstanding Securities of TDS USA and TDS Canada, respectively (or their
respective successors), (iii) except as permitted by Section 9.1.3, the
Business, the Facilities, the Internet Store, the Distribution Centers and any
material assets relating to or used in connection therewith will not be owned,
leased, licensed, controlled and/or operated by any Person other than TDS USA
and TDS Canada (or their respective successors), and (iv) TDS USA, TDS Canada
and their respective Subsidiaries (or any of their respective successors) will
not directly or indirectly own, lease, license, control, maintain, manage,
staff, supply, administer, market, advertise, promote, operate or otherwise
engage in any manner in any business or activity other than the Business, in
which case such transaction shall be subject to the prior written approval of
TDSF in its business judgment. Any approval of TDSF required pursuant to this
Section&#160;9.12.2 shall be sought in accordance with the approval provisions
set forth in Section&#160;9.19.3. For purposes of clarification, consummation by
TDS USA of the TDS USA Merger pursuant to and in accordance with Section
9.12.1(a)(I) shall not be or be deemed to be a breach by TDS USA of this Section
9.12.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.12.3 <U>Distinct Public
Name of Licensee Entities</U>. Licensee shall, and shall cause each Licensee
Entity to, at all times hold itself out to the public through, and shall be
known by, a Distinct Public Name, and each of TDS USA and TDS Canada shall
change its name to such a Distinct Public Name within twenty (20) Business Days
following the Effective Date. In addition, if Licensee or any License Entity
engages in any public offering of any of its Securities or seeks to register any
of its Securities under the Securities Act or any other applicable securities
Laws, then such Securities shall be traded under a Distinct Public Name approved
by TDSF in its sole discretion, such that there shall be no confusion between
such Securities offered by Licensee or any Licensee Entity pursuant to such
public offering or registration and the publicly traded Securities of TDSF or
any of its Affiliates. Licensee acknowledges and agrees that TDSF has approved
the use of the name "Hoop" (and variations thereof) in connection with
the Licensee Entities only for so long as no Securities of any such Licensee
Entity are registered under the Securities Act or other applicable securities
Laws or publicly traded in any manner, but in the event any such Securities are
to be so registered and/or publicly traded, the name "Hoop" (and
variations thereof) will be required to be changed prior to such registration or
public offering to a different Distinct Public Name approved by TDSF in its sole
discretion. This provision shall survive the expiration or earlier termination
of this Agreement indefinitely. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.13     <U>Governance</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.13.1 <U>Board Observation
Rights at Licensee/TCP Entities</U>. During the Term, with respect to (i) TCP,
each Subsidiary of TCP that is engaged in the Business in any manner (other than
the Licensee Entities), and any Parent Affiliate of TCP (collectively, the
"<B>TCP Entities</B>"), and (ii)&#160;Licensee Parent, Licensee, Canadian
Parent and their respective Subsidiaries (collectively, "<B>Licensee
Entities</B>"), notwithstanding anything to the contrary contained in the
Governing Documents of the TCP Entities or the Licensee Entities, TDSF shall
have the right to have its designee (the "<B>Board Observer</B>") attend all
meetings ("<B>Board Meetings</B>") of the board of directors, management
committee, managing members or other comparable governing body (each, a
"<B>Board</B>") of each of the TCP Entities and the Licensee Entities and
review in advance each action proposed to be taken by each such Board without a
meeting thereof, in accordance with, and subject to, the following: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Licensee shall
deliver, and shall cause the other Licensee Entities and the TCP Entities to
deliver, to TDSF copies of all reports, notices, minutes, consents, actions
taken and/or proposed to be taken without a meeting and other materials that the
Licensee Entities and the TCP Entities provide to their respective Board members
(collectively, "<B>Board Communications</B>"), including, without limitation, at least
five (5) Business Days' advance written notice of each Board Meeting;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) The Board
Observer shall be permitted to attend all Board Meetings in person or by
telephone, and Licensee shall ensure that appropriate arrangements are made such
that the Board Observer will be able to hear everyone during any Board Meeting
at which the Board Observer participates by telephone;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) Prior to
attending his or her first Board Meeting, each Board Observer shall be required
to execute a customary and reasonable confidentiality agreement in form and
substance reasonably satisfactory to each of Licensee and TDSF;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) The Board
Observer shall be an observer only, shall not be an actual member of any Board
and shall not have any of the rights, duties or obligations of a member of any
Board, including, without limitation, no right to vote on any matter that may
come before the Board and no fiduciary or other obligations to any Licensee
Entity or TCP Entity, any of their respective securityholders or any other
Person arising from being a Board Observer, and Licensee shall indemnify and
hold harmless each Board Observer with respect to any Loss that may arise
directly or indirectly from, out of or based on his or her service as a Board
Observer (other than any Loss arising from the Board Observer's breach of the
confidentiality agreement referred to in the preceding subparagraph (c) of this
Section 9.13.1);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) The TCP
Entities (but not the Licensee Entities) shall have the right to exclude the
Board Observer from any portion of their respective Board Meetings (and any
related portion of any Board Communications) consisting of any compensation
committee meeting or any executive session, in each case where all members of
the Board who are also employees of the respective TCP Entity are also excluded
(collectively, such compensation committee meeting and such executive session, a
"<B>Board Special Committee Session</B>"), <U>provided</U>, that (i) such Board Special
Committee Session is conducted in a manner consistent with past practice and
does not relate to the Business and (ii) TDSF is provided advance written notice
of such Board Special Committee Session; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) TDSF shall have
the right to designate any officer or advisor of TDSF or its Affiliates as the
Board Observer and replace or substitute the Board Observer with another officer
or advisor of TDSF or its Affiliates from time to time during the Term, subject
to Licensee's written consent of each such designee, which consent shall not be
unreasonably withheld.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.13.2 <U>Independent
Directors at Licensee Entities</U>. During the Term, notwithstanding anything to
the contrary contained in the Governing Documents of any Licensee Entity, the
Board of each Licensee Entity (each, a "<B>Licensee Board</B>" and
collectively, the "<B>Licensee Boards</B>") shall at all times include at
least two (2) Independent Directors, in accordance with, and subject to, this
Section 9.13.2 (provided that, with respect to TDS Canada (or, as applicable,
its successor), (x) such two (2) Independent Directors shall not be required to
be on the Board of TDS Canada until the date that is twenty (20) Business Days
following the Effective Date or, if and only if the Canada Reincorporation is
delayed beyond the twentieth (20th) Business Day following the Effective Date as
a result of an action taken or failed to be taken in error on or prior to the
Effective Date by TDSF or its Affiliates that renders it impossible to effect
the Canada Reincorporation within such twenty (20) Business Day period as
described in the first parenthetical of Section 9.12.1(a)(III), then until the
date that is the Canada Reincorporation Date, and (y) so long as the Independent
Directors are not on the Board of TDS Canada, TDS Canada shall not be permitted
to engage in any of the transactions contemplated by Section 9.13.3 without the
prior written consent of TDSF in its sole discretion). Except as otherwise
provided in this Section 9.13.2, each Independent Director shall be jointly
selected by Licensee and TDSF and, unless otherwise agreed by each of TDSF and
Licensee in its respective sole discretion, shall serve on each of the Licensee
Boards. The term of each Independent Director on each Licensee Board shall be
two (2) years, following which such Independent Director shall be removed from
and replaced with a new Independent Director on each Licensee Board,
<U>provided</U>, that any Independent Director may serve on any Licensee Board
for one (1) additional two (2) year term with the approval of TDSF in its sole
discretion and, thereafter, for additional two (2) year terms with the approval
of each of TDSF and Licensee in its respective sole discretion. An Independent
Director may be removed from a Licensee Board during such Independent
Director&#146;s term only with the prior written consent of each of TDSF and
Licensee, to be granted or denied in its respective sole discretion. In the
event of the death, incapacity, resignation or removal of an Independent
Director or the expiration of his or her term as herein provided, a replacement
Independent Director shall be selected in accordance with the procedure set
forth in the following sentence, and, without the prior written consent of TDSF,
no Licensee Board shall take any action requiring the consent of the Independent
Directors pursuant to Section 9.13.3 unless and until such replacement
Independent Director has been duly appointed. Upon the death, incapacity,
resignation or removal of, or at least six (6) months prior to the expiration of
the term of, any Independent Director, each of Licensee and TDSF shall submit to
the other the names of three (3) proposed candidates to serve as an Independent
Director for the next two (2) year term and, for a period of three (3) months
after such submissions, Licensee and TDSF shall negotiate in good faith
regarding which of the proposed candidates shall serve as Independent
Director(s) for such next term; <U>provided</U>, that, if the parties fail to
mutually agree upon the Independent Director(s) to serve for such next term from
such proposed candidates within such three (3) month period, TDSF shall submit
to Licensee the names of four (4) proposed candidates (or, if only one
Independent Director remains to be selected, two (2) proposed candidates) to
serve as Independent Director(s) for such next term and Licensee shall designate
two (2) of such proposed candidates (or, if only one Independent Director
remains to be selected, one (1) of such proposed candidates) to so serve for
such term, and Licensee shall be entitled to object to any of such four (4) (or,
if applicable, two (2)) candidates proposed by TDSF if and only if such
candidate fails to satisfy one (1) or more of the elements of the definition of
"Independent Director" set forth in Section 1. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.13.3 <U>Major Decisions
Requiring Approval of Independent Directors</U>. In addition to any other
approval required under applicable Law or the Governing Documents of any
Licensee Entity or otherwise, Licensee shall be responsible for ensuring that no
Licensee Entity shall do, cause or permit any of the following to occur without
the approval of both of the Independent Directors of such Licensee Entity: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) (i) the making
by any Licensee Entity of an assignment for the benefit of its creditors; or
(ii) the bringing of any action by any Licensee Entity seeking its dissolution,
the liquidation of any of its assets or the appointment of a trustee, interim
trustee, receiver or other custodian for any of its property; or (iii) the
voluntary commencement by any Licensee Entity of a proceeding under the Federal
Bankruptcy Code or any other applicable bankruptcy Law, or of a reorganization
or arrangement proceeding for the settlement, readjustment, composition or
extension of any of its debts upon any terms, or of an action or petition
seeking similar relief or alleging that it is Insolvent or unable to pay its
debts as they mature; or (iv) the consent by any Licensee Entity to any action
brought against the Licensee Entity seeking its dissolution or liquidation of
any of its assets, or seeking the appointment of a trustee, interim trustee,
receiver or other custodian for any of its property;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) the payment by
any Licensee Entity of any dividends or other distributions to the holders of
its Securities on or with respect to its Securities (each, a "<B>Dividend
Payment</B>"), other than (without duplication and provided that each written notice
provided by Licensee hereunder shall specify under which of the following
subparagraphs any Dividend Payment is purported to be authorized): (I) by TDS
Canada to Canadian Parent or by Canadian Parent to TDS USA (provided that
Licensee shall provide TDSF with at least five (5) Business Days prior written
notice thereof); (II) any payment due from any Licensee Entity under the TCP Tax
Sharing Agreement or the TCP Intercompany Services Agreement in accordance with
its terms (provided that Licensee shall provide TDSF with at least five (5)
Business Days prior written notice of any payment under the TCP Tax Sharing
Agreement); (III) following the three (3) month anniversary of the Effective
Date, subject to compliance with the conditions set forth in Subparagraphs (i),
(ii) and (iv) of this Section 9.13.3(b) as of the date of declaration and
payment of the respective Dividend Payments, one (1) or more Dividend Payments
that do not exceed, as of the date of declaration and payment thereof, in the
aggregate for all Dividend Payments made pursuant to this Subparagraph (III),
either (x) Cumulative Cash Flow as of such dates or (z) the NWC Permitted
Dividend Amount (and, if any Dividend Payment is made without the approval of
both of the Independent Directors of such Licensee Entity pursuant to this
Subparagraph (III), Licensee shall, at least five (5) Business Days prior to the
date on which such Dividend Payment is to be made, cause its Chief Financial
Officer (or a senior executive financial officer of Licensee with knowledge of
or responsibility for the matters being certified) to certify in writing to TDSF
that the conditions of this Subparagraph (III) have been and will be met on the
date of declaration and payment of the Dividend Payment, which certification
shall be accompanied by a reasonably detailed calculation of the Cumulative Cash
Flow, the NWC Permitted Dividend Amount and all Dividend Payments that have been
made and are then proposed to be made pursuant to this Subparagraph (III));
provided that (1) any amount that is treated as a funding commitment payment by
TCP and Licensee Parent pursuant to the last sentence of Section 2(b) of the TCP
Guaranty and Commitment shall count against (or as a payment of) the NWC
Permitted Dividend Amount hereunder for purposes of determining compliance with
subparagraph (z) of this Subparagraph (III) and (2) Licensee shall be required
to exercise its rights under this Subparagraph (III) prior to exercising its
rights under the following Subparagraph (IV); or (IV) a Dividend Payment in
connection with which each of the following conditions is met at both the time
such Dividend Payment is declared and paid (and, if any Dividend Payment is made
without the approval of both of the Independent Directors of such Licensee
Entity pursuant to this Subparagraph (IV), Licensee shall, at least five (5)
Business Days prior to the date on which such Dividend Payment is to be made,
cause its Chief Financial Officer (or a senior executive financial officer of
Licensee with knowledge of or responsibility for the matters being certified) to
certify in writing to TDSF that the following conditions have been and will be
met on the date of declaration and payment of the Dividend Payment, which
certification shall be accompanied by a reasonably detailed calculation of the
matters set forth in the following Subparagraphs (v), (vi) and
(vii)):</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) There shall be
no Uncured Royalty Breach, Uncured Licensee Infringing Use or Uncured Material
Breach by Licensee;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) There shall be
no continuing, uncured breach by either TCP or Licensee Parent of any material
term, covenant or condition that is binding upon TCP or Licensee Parent under
the TCP Guaranty and Commitment;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) None of the
Licensee Entities shall have any outstanding Indebtedness with a term of one (1)
year or more;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) None of the
Licensee Entities shall have violated or breached in any material respect, or
committed any material event of default or any act or omission that, with notice
or the passage of time or both, would result in a material event of default
under the terms of any material Contract that is binding upon such Licensee
Entity, which violation, breach or event of default has not been cured within
the applicable time period permitted under such Contract;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (v) Licensee shall
have completed and fulfilled in its entirety the Initial Minimum Refurbishment
Commitment in accordance with the terms of Section 9.3.5(b);</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vi) the sum of
such Dividend Payment <U>plus</U> all Dividend Payments previously paid shall not
exceed an amount equal to fifty percent (50%) of Cumulative Cash Flow prior to
the subject Dividend Payment, <U>provided</U>, that, if (A) at both the time the
subject Dividend Payment is declared and paid and immediately following the
payment thereof (taking into account such payment), there is at least Ninety
Million Dollars ($90,000,000) of cash and cash equivalents reflected on the
consolidated balance sheet of Licensee Parent, Licensee, Canadian Parent and
their respective Subsidiaries, and (B) at both the time the subject Dividend
Payment is declared and paid, Licensee, Licensee Parent, Canadian Parent and
their respective Subsidiaries have generated at least Ninety Million Dollars
($90,000,000) of Cumulative Cash Flow since the Effective Date, the sum of the
Dividend Payment <U>plus</U> all Dividend Payments previously paid may exceed an amount
equal to fifty percent (50%) of Cumulative Cash Flow prior to the subject
Dividend Payment but shall not exceed an amount equal to ninety percent (90%) of
Cumulative Cash Flow prior to the subject Dividend Payment; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vii) the Dividend
Payment shall not exceed an amount equal to the amount of cash and cash
equivalents projected as of the date that is the last day of the Contract Year
immediately following the Contract Year in which the subject Dividend Payment is
to be made, assuming the payment in full as of such date of all Licensee
Payments that will have accrued up to and including such date, all calculated in
accordance with GAAP and in good faith by Licensee and based, in the case of
future periods, on the Annual Business Plan for such future periods;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) except as
permitted pursuant to subparagraph (a) or (b) of Section 9.17.2 or subparagraph
(d) of this Section 9.13.3, the incurrence by Licensee Entities of any
Indebtedness outstanding at any time in excess of Twenty-Five Million Dollars
($25,000,000) in the aggregate among all such entities;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) the guarantee
by any Licensee Entity of any Indebtedness of any Person, other than a guarantee
by a Licensee Entity in connection with the incurrence of Indebtedness as
permitted pursuant to subparagraph (a) or (b) of Section 9.17.2;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) the making of
any capital expenditures or capital expenditure commitments by any Licensee
Entity, other than capital expenditures and capital expenditure commitments
related to Refurbishments or New Store Construction, in excess of (i) during the
Initial Term, Fifteen Million Dollars ($15,000,000) in any Contract Year (which,
in the first (1st) Contract Year, will include the Stub Period), (ii) during the
First Renewal Term, if applicable, Twenty Million Dollars ($20,000,000) in any
Contract Year, (iii) during the Second Renewal Term, if applicable, Twenty-Five
Million Dollars ($25,000,000) in any Contract Year and (iv) during the Third
Renewal Term, if applicable, Thirty Million Dollars ($30,000,000) in any
Contract Year;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) the making of
any capital contribution or any other Transfer of cash, cash equivalents,
assets, properties, operations or any other portion of the TDS USA business by
TDS USA to any of its Subsidiaries in an amount that exceeds, on a cumulative
basis from the Effective Date to the applicable date of determination, an amount
equal to (i) the portion of the Funding Commitment (as defined in the TCP
Guaranty and Commitment) that has been fully and indefeasibly paid and satisfied
through the payment of cash or freely transferable Cash Equivalents (as defined
in the TCP Guaranty and Commitment) by TCP and/or Licensee Parent to TDS USA in
accordance with the terms of the TCP Guaranty and Commitment on a cumulative
basis from the Effective Date to the applicable date of determination,
<U>multiplied by</U> (ii) a fraction, the numerator of which is the number of
Facilities operating in Canada as of the applicable date of determination and
the denominator of which is the total number of Facilities operating throughout
the Territory as of the applicable date of determination; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) the agreement
by any Licensee Entity to take (or cause to be taken) any actions described in
the preceding subparagraphs (a) through (f).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.13.4 <U>Decisions
Requiring the Approval of Only the Independent Directors</U>. Upon the
occurrence of and at all times during the continuance of any event described in
Section 13.11 that would provide TDSF with a right of termination hereunder, the
Independent Directors (acting alone and without any other approval or
authorizations) shall be entitled to approve and authorize (i) the making by any
Licensee Entity of an assignment for the benefit of its creditors, (ii) the
bringing of any action by any Licensee Entity seeking its dissolution, the
liquidation of any of its assets or the appointment of a trustee, interim
trustee, receiver or other custodian for any of its property, (iii) the
voluntary commencement by any Licensee Entity of (a) a proceeding under the
Federal Bankruptcy Code or any other applicable bankruptcy Law, (b) a
reorganization or arrangement proceeding for the settlement, readjustment,
composition or extension of any of such Licensee Entity&#146;s debts upon any
terms, or (c) an action or petition seeking similar relief or alleging that such
Licensee Entity is Insolvent or unable to pay its debts as they mature, or (iv)
the consent by any Licensee Entity to any action brought against the Licensee
Entity seeking its dissolution or liquidation of any of its assets, or seeking
the appointment of a trustee, interim trustee, receiver or other custodian for
any of its property. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.13.5 <U>Incorporation
into Governing Documents</U>. The Governing Documents for each of the Licensee
Entities and the TCP Entities shall contain provisions specifying the terms of
Sections 9.13.2, 9.13.3 and 9.13.4, and such Governing Documents shall otherwise
be in accordance with the terms of such Sections. For purposes of clarification,
such Governing Documents shall provide full membership rights to the Independent
Directors (the same as any other member of the Board, other than the additional
rights and obligations set forth in Sections 9.13.2, 9.13.3 and 9.13.4) and
shall not limit any rights, voting or otherwise, of the Independent Directors. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.14 <U>Auditors</U>.
Licensee&#146;s auditors shall be a nationally recognized "Big&#160;4"
accounting firm (or, in the event that all of the "Big 4" accounting
firms in existence as of the Effective Date cease to exist during the Term, an
accounting firm of comparable national standing satisfactory to TDSF in its
business judgment). Licensee shall promptly notify TDSF in writing of any change
in Licensee&#146;s auditors. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.15     <U>Affiliate Transactions</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.15.1 <U>Intercompany
Agreements</U>. Without the prior written approval of TDSF in its sole
discretion, none of Licensee Parent, Licensee, Canadian Parent or any of their
respective Subsidiaries shall make any payment or reimbursement to, or borrow
any monies or receive any services from, or permit any Encumbrance to be placed
upon the Business, any Licensee Securities, any Licensee Affiliate Securities or
any of the Contracts (including, without limitation, this Agreement), assets or
properties of Licensee or any Licensee Entity in connection with, TCP or any of
its Affiliates (other than the Licensee Entities, subject to Section 9.17.2(e)),
except pursuant to and in accordance with the provisions of the TCP Intercompany
Services Agreement or the TCP Tax Sharing Agreement. For purposes of
clarification and without limiting the foregoing, under no circumstances shall
TCP or its Affiliates be entitled to pledge as collateral or grant any security
interest in or otherwise Encumber any Licensee Securities, any Licensee
Affiliate Securities, any Contracts (including without limitation, this
Agreement), assets or properties of Licensee or any Licensee Entity or any
portion of the Business in connection with any Indebtedness of TCP or its
Affiliates (other than the Licensee Entities to the extent permitted under
Section 9.17.2(e)). Any amendments, modifications, waivers, renewals,
replacements or other changes to or under the TCP Intercompany Services
Agreement or the TCP Tax Sharing Agreement shall be subject to the approval of
TDSF in its business judgment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.15.2 <U>Other
Transactions with Affiliates</U>. Other than the TCP Intercompany Services
Agreement and the TCP Tax Sharing Agreement, all transactions between Licensee
and/or its Subsidiaries, on the one hand, and any of their respective
Affiliates, on the other hand (including, without limitation, any purchase,
sale, lease or exchange of property), shall be conducted at all times on an
arm&#146;s length, commercially reasonable basis and on terms and conditions at
least as favorable to Licensee and its Subsidiaries as those that would be
commercially available from an unaffiliated third party. Except as otherwise
provided in Section 9.12.2, any transaction between Licensee and/or its
Subsidiaries, on the one hand, and one (1) or more of their respective
Affiliates, on the other hand (other than a transaction pursuant to and in
accordance with the TCP Intercompany Services Agreement or the TCP Tax Sharing
Agreement), involving more than Sixty Thousand Dollars ($60,000) in the
aggregate (or such greater amount as may be set forth as the disclosure
threshold under Item 404(a) of Regulation S-K promulgated by the Securities and
Exchange Commission, as amended, modified or replaced from time to time) in any
Contract Year shall be subject to TDSF&#146;s prior written approval in its sole
discretion, which approval shall be sought in accordance with the approval
provisions set forth in Section 9.19.3. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.16 <U>Permits and
Compliance With Law</U>. Licensee shall be responsible for making any filings
with, and applying for, obtaining and maintaining all permits, authorizations,
variances, waivers, licenses and other approvals required from, Governmental
Entities for the construction, maintenance and operation of the Business
Properties and all other matters pertaining to the operation of the Business;
<U>provided</U>, that, upon Licensee&#146;s request and at Licensee&#146;s
expense, TDSF shall cooperate with Licensee to make such filings and to obtain
and maintain such permits, authorizations, variances, waivers, licenses and
approvals. Without limiting any other specific obligations of Licensee hereunder
(including the preceding sentence), Licensee shall ensure, and shall be solely
responsible for ensuring, that all of the operations of the Business Properties
and the Business as described in this Agreement or otherwise shall at all times
be conducted in accordance with all applicable Laws. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.17     <U>Funding of Business</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.17.1 <U>Operating
Costs</U>. Except to the extent of any reimbursement obligation of TDSF
expressly provided in this Agreement, Licensee shall bear all costs incurred in
connection with the operation of the Business Properties and the Business and
the performance of its obligations under this Agreement, including, without
limitation, all costs with respect to the identification and leasing or
acquisition of each Business Property; the development, construction,
installation and furnishing of the Business Properties; the creation,
development, hosting and operation of the Internet Store and all distribution
and back office functions relating thereto; the manufacture, sourcing, delivery,
distribution, offer for sale, sale, and marketing, advertising and promotion of
Disney Merchandise; operations and personnel training; and preparing any
statements, reports or other documents required by this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.17.2 <U>Indebtedness of
Licensee and its Subsidiaries</U>. Without the prior written approval of TDSF in
its sole discretion, Licensee shall not, and shall not permit any of its
Subsidiaries to, issue any debt Securities, incur any Indebtedness or guarantee
or otherwise be or agree to be liable for any Indebtedness or liabilities of any
Person, except as permitted by and in accordance with the following: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Licensee and/or
its Subsidiaries shall be permitted to incur trade payables and comparable
liabilities having terms of one (1) year or less and incurred in the ordinary
course of business; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) From the
Effective Date until the fifth (5th) anniversary of the Effective Date (the
"<B>Five Year Date</B>"), Licensee and/or its Subsidiaries shall be permitted to enter
into and incur Indebtedness under one (1) or more loan agreements, credit
agreements, lines of credit, working capital or other bank facilities or similar
arrangements under which a bank or other financial institution provides or
arranges loans, letters of credit and/or the extension of credit to Licensee
and/or its Subsidiaries in connection with the operation of the Business
(collectively, the "<B>Debt Facilities</B>"); provided, that (i) the amount of funds
available under the Debt Facilities is determined based solely on Licensee's and
its Subsidiaries' inventory (including, to the extent permitted under the
applicable Debt Facility, inventory on order) and accounts receivable and is not
increased based on a guarantee by TCP or its Affiliates or any other Person
(other than Licensee's Subsidiaries) or any other credit-enhancing factor or
device (provided, that any such guarantee by TCP or its Affiliates or other
credit-enhancing factor or device shall not be prohibited so long as (x) such
guarantee or other credit-enhancing factor or device is necessary to obtain any
such Debt Facility or to obtain a more favorable interest rate and (y) the
amount of funds available under any such Debt Facility is not increased, in
whole or in part, based on such guarantee or other credit-enhancing factor or
device); (ii) Indebtedness incurred under all such Debt Facilities, taken
together, shall be limited to (A) trade letters of credit to fund inventory
purchases without limitation, (B) one (1) or more revolving loans having terms
of one (1) year or less to fund (x) working capital needs or letters of credit
to fund working capital needs other than inventory purchases, in each case
including, without limitation, capital expenditures in connection with
Refurbishments and New Store Construction, or (y) the portion of the net working
capital adjustment that may, at the election of Licensee Parent, be paid by
Licensee pursuant to Section 3.3.1(B) of the Acquisition Agreement (such loans
and letters of credit, collectively, the "<B>Revolving Loans</B>") and/or (C) one (1)
or more term loans having terms of more than one (1) year solely to fund capital
expenditures for purposes other than Refurbishments and New Store Construction
(collectively, the "<B>Term Loans</B>") (by way of example and without limitation,
capital expenditures in connection with a new information technology system or a
new Distribution Center shall be permitted uses of funds borrowed pursuant any
Term Loan); and (iii) (x) the aggregate outstanding liability of Licensee and
its Subsidiaries under all Term Loans shall not exceed Seven Million Five
Hundred Thousand Dollars ($7,500,000) in the aggregate at any time, (y) the
aggregate outstanding liability of Licensee and its Subsidiaries under all
Revolving Loans and all Term Loans, taken together, shall not exceed (aa) Forty
Million Dollars ($40,000,000) in the aggregate during the period from the
Effective Date to February 1, 2005, by which time such outstanding aggregate
liability must be paid down to Twenty-Five Million Dollars ($25,000,000) or less
in the aggregate, and (bb) following February 1, 2005 and the pay-down referred
to in the preceding subparagraph (aa), Thirty-Five Million Dollars ($35,000,000)
in the aggregate at any time and (z) at least once per calendar year (other than
calendar year 2004), the aggregate outstanding liability of Licensee and its
Subsidiaries under all Revolving Loans and all Term Loans, taken together, shall
be reduced to an amount equal to Ten Million Dollars ($10,000,000) or less (for
purposes of this subparagraph (iii), "aggregate outstanding liability" shall
include all liability for principal, interest, penalties, fees, charges and
other payments in any form and the amount of letters of credit to fund working
capital needs other than inventory purchases described in subparagraph (ii)(B)
of this Section 9.17.2(b) shall be deemed to constitute outstanding principal); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) From the Five
Year Date until the date as of which TCP and Licensee Parent have invested at
least One Hundred Million Dollars ($100,000,000) in cash or cash equivalents in
Licensee pursuant to the TCP Guaranty and Commitment, Licensee and/or its
Subsidiaries shall be permitted to enter into and incur Indebtedness under one
(1) or more Debt Facilities; provided, that (i) the amount of funds available
under the Debt Facilities is determined based solely on Licensee's and its
Subsidiaries' inventory and accounts receivable and is not increased based on a
guarantee by TCP or its Affiliates or any other Person (other than Licensee's
Subsidiaries) or any other credit-enhancing factor or device (provided, that any
such guarantee by TCP or its Affiliates or other credit-enhancing factor or
device shall not be prohibited so long as (x) such guarantee or other
credit-enhancing factor or device is necessary to obtain any such Debt Facility
or to obtain a more favorable interest rate and (y) the amount of funds
available under any such Debt Facility is not increased, in whole or in part,
based on such guarantee or other credit-enhancing factor or device); and (ii)
such Debt Facilities and all Indebtedness incurred thereunder shall be subject
to the approval of both of the Independent Directors of Licensee or such
Subsidiary, as applicable, to the extent required by subparagraphs (c) and/or
(d) of Section 9.13.3; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) Following the
later of (i) the Five Year Date and (ii) the date as of which TCP and Licensee
Parent have invested at least One Hundred Million Dollars ($100,000,000) in cash
or cash equivalents in Licensee pursuant to the TCP Guaranty and Commitment,
Licensee and/or its Subsidiaries shall be permitted to enter into and incur
Indebtedness under one (1) or more Debt Facilities; provided, that such Debt
Facilities and all Indebtedness incurred thereunder shall be subject to the
approval of both of the Independent Directors of Licensee or such Subsidiary, as
applicable, to the extent required by subparagraphs (c) and/or (d) of Section
9.13.3; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) Without
limiting the provisions of subparagraphs (a) through (d) of this Section 9.17.2,
Licensee acknowledges and agrees that, with respect to any Debt Facility
proposed to be entered into by Licensee or its Subsidiaries, Licensee shall, at
least fifteen (15) Business Days prior to entering into or permitting any
Subsidiary to enter into any such Debt Facility, provide TDSF with drafts of all
Contracts to be entered into by Licensee or its Subsidiaries in connection
therewith and shall, thereafter, provide TDSF with each draft of any such
Contract that is distributed between the parties thereto (redlined to reflect
changes therein). TDSF shall have the right to review and comment on all drafts
of such Contracts, which comments shall be considered by Licensee and its
Subsidiaries in good faith, and the final versions of all terms and provisions
of such Contracts that relate to or affect in any manner the remedies
thereunder, the termination thereof or defaults and/or events of default
thereunder, or that, as determined by TDSF in its business judgment, relate to
or affect in any manner this Agreement, the rights or obligations of the parties
hereunder or the names, brands, trademarks, logos, symbols, characters or other
proprietary designations or intellectual property of TDSF or its Affiliates,
shall be subject to the prior written approval of TDSF in its business judgment.
Without limiting the foregoing, unless TDSF shall otherwise consent in its sole
discretion, Licensee acknowledges and agrees that, in connection with any new
Debt Facility entered into by Licensee in accordance with this Section 9.17
following the Effective Date, (i) such Debt Facility shall provide that, upon
the occurrence of any default or event of default that would allow a lender or
any other Person under such Debt Facility to foreclose on or sell the inventory
or other collateral securing the obligations under such Debt Facility, TDSF and
its Affiliates shall have protections, cure periods, grace periods and other
rights and remedies at least equal to those available to TDSF and its Affiliates
under the Original Debt Facility, (ii) except and only to the limited extent
granted under the Original Debt Facility, under no circumstances whatsoever
shall this Agreement, or any rights of Licensee arising hereunder in the Disney
Properties, the Licensed Materials or any other names, brands, trademarks,
logos, symbols, characters or other proprietary designations or intellectual
property of TDSF or its Affiliates, be pledged as collateral for, be the subject
of any security interest or lien granted in connection with, or otherwise be
Encumbered in any manner whatsoever by, any such Debt Facility, and (iii) except
and only to the limited extent entered into in connection with the Original Debt
Facility, neither TDSF nor its Affiliates shall be required to enter into any
Contract (including, without limitation, any inter-creditor agreement)
associated with any such Debt Facility (provided that, with respect to any new
Debt Facility of Licensee and its Subsidiaries that complies with the provisions
of this Agreement, including this Section 9.17.2, upon Licensee's request, TDSF
shall enter into an agreement with the agent or lender under such new Debt
Facility containing the same provisions as those set forth in the "Designation
of Secured Lender Under License Agreement" entered into by TDSF in connection
with the Original Debt Facility). The foregoing provisions of this Section
9.17.2(e) shall apply equally to any proposed amendment, modification or other
change to any Debt Facility of Licensee or its Subsidiaries, including, without
limitation, the Original Debt Facility. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.17.3 <U>Indebtedness of
Licensee Parent and Canadian Parent</U>. Without the prior written approval of
TDSF in its sole discretion, neither Licensee Parent nor Canadian Parent shall
under any circumstances issue any debt Securities, incur any Indebtedness,
guarantee or otherwise be or agree to be liable for any Indebtedness of any
Person or otherwise incur or suffer to exist any material liabilities of any
kind, other than Licensee Parent&#146;s obligations under the TCP Guaranty and
Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.18 <U>Operating Manual</U>. Prior to the Effective Date, TDSF and Licensee
have agreed upon the terms of one (1) or more operating manuals setting forth,
among other things, operating procedures, employee training requirements,
quality control procedures and other policies and procedures applicable to the
conduct of the Business and the Business Properties (collectively, the
"<B>Operating Manual</B>"). Licensee shall, and shall cause its Affiliates to, comply
with and abide by the Operating Manual. Each of TDSF and Licensee may, from time
to time, propose changes in, additions to or deletions, variations or departures
from the Operating Manual by providing written notice of such proposal to the
other party. The parties shall consider any such proposal in good faith and any
such proposed change, addition, deletion, variation or departure shall be
subject to the approval of TDSF and Licensee in their respective business
judgment; <U>provided</U>, that (i) any proposed change, addition, deletion,
variation or departure relating to the Disney Properties, the Licensed Materials
or any other names, brands, trademarks, logos, symbols, characters or other
proprietary designations or intellectual property of TDSF or any of its
Affiliates shall, if proposed by Licensee, be subject to the approval of TDSF in
its sole discretion or, if proposed by TDSF, not require the approval of
Licensee, (ii) neither party shall disapprove any proposed change, addition,
deletion, variation or departure that is necessary in order to comply with
applicable Law or any change thereof, including, without limitation, health and
safety standards and regulations, and (iii) any proposed change, addition,
deletion, variation or departure that is intended to amend, modify, supplement
or replace any of the terms or provisions of this Agreement or has the effect of
amending, modifying, supplementing or replacing any of such terms or provisions
shall be subject to the approval of TDSF and Licensee in their respective sole
discretion. Licensee shall reimburse TDSF for all costs and expenses incurred by
TDSF or its Affiliates in connection with the design, development, printing and
distribution of the Operating Manual and any amendments thereto. Notwithstanding
the preceding sentence, TDSF shall be, and be deemed to be, the sole and
exclusive owner of the Operating Manual and all rights therein, which are
reserved to TDSF. Licensee shall neither acquire nor assert any rights in or to
the Operating Manual and, without limiting the foregoing, Licensee hereby
assigns to TDSF all rights created by its use of the Operating Manual, together
with the goodwill attaching to that part of Licensee&#146;s business in
connection with which the Operating Manual is used. TDSF&#146;s ownership of the
Operating Manual shall include sole and exclusive ownership of all amendments,
modifications, replacements or other derivatives thereof or therefrom,
regardless of which party is responsible for any of the foregoing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.19 <U>Operational Approval Procedures</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.19.1 <U>Approving
Openings and Closings of Business Properties</U>. Licensee shall not be
permitted to open or close any Facility without obtaining (i) in the case of
Permitted Openings, TDSF&#146;s written approval of the New Store Construction
pursuant to Section&#160;9.19.2 and (ii) in any case other than Permitted
Openings and Permitted Closings, TDSF&#146;s written approval of the
Opening/Closing Proposal pursuant to the following provisions of this
Section&#160;9.19.1 in each instance: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Submissions</U>.
Licensee shall submit to TDSF for approval (i) a written proposal with respect
to the opening or closing of the Business Property (the "<B>Opening/Closing
Proposal</B>"), (ii) specific information with respect to the location of the
Business Property proposed to be opened or closed, (iii) in the case of the
closing of a Business Property, a statement of the proposed Barricade Procedures
and Wind Down Procedures for such Business Property and, if the applicable Lease
Agreement is not expiring, the manner in which the Lease Agreement will be
terminated and the status of the consent or non-consent of the Landlord
pertaining thereto and any terms and conditions related to obtaining such
consent, and (iv) all other background information and supporting material as
will be reasonably necessary, or as TDSF may reasonably request, to allow TDSF
to make an informed judgment and appraisal for purposes of TDSF's approving or
disapproving Licensee's Opening/Closing Proposal. All such materials shall be
submitted to the individual so designated by TDSF.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>Approval or
Disapproval</U>. Provided that Licensee has fully complied with Section 9.19.1(a),
within twenty (20) Business Days following Licensee's submission thereof, TDSF
shall notify Licensee of its approval or disapproval of the Opening/Closing
Proposal. Licensee acknowledges and agrees that TDSF shall not approve any
proposed closing of a Business Property pursuant to this Section 9.19.1 unless
(i) the related Lease Agreement is expiring concurrently with such closing or
authorizes cessation of operations at such Business Property prior to expiration
thereof or (ii) the respective Landlord under the related Lease Agreement has
consented to the early termination thereof and the terms and conditions upon
which the Landlord has granted such consent are satisfactory to TDSF in its
business judgment.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Modification of
Opening/Closing Proposal; Postponement or Revocation of Approval</U>. In the event
that an Opening/Closing Proposal approved by TDSF pursuant to Section 9.19.1(b)
or any of the materials submitted to TDSF pursuant to Section 9.19.1(a) in
connection with the approval thereof are (or, in light of changed circumstances,
need to be) modified or updated prior to, in the case of a proposed New Business
Property opening, the execution of the New Business Property Lease Agreement for
such New Business Property by Licensee or any of its Affiliates and, in the case
of a proposed Business Property closing, such closing, Licensee shall submit a
modified Opening/Closing Proposal, together with any modified or new supporting
materials of the type described in Section 9.19.1(a). Provided that Licensee has
fully complied with this Section 9.19.1(c), TDSF shall notify Licensee of its
approval or disapproval of the modified Opening/Closing Proposal within ten (10)
Business Days following Licensee's submission of the materials required or
requested to be submitted pursuant to this Section 9.19.1(c). In the event that
(i) any such modifications, (ii) any alleged or actual copyright and/or
trademark infringement or other Disney IP Claim or any other legal consideration
or rights dispute regarding any intellectual property, or (iii) any corporate
brand considerations, including, without limitation, protection of the Disney
Properties or the "Disney" brand, name, reputation and quality, requires, in
TDSF's sole discretion, the temporary postponement (or, if necessary,
revocation) of any previous approval, then TDSF shall be entitled to postpone or
revoke such approval by promptly notifying Licensee thereof; <U>provided</U>, that, in
the case of a revocation pursuant to the preceding subparagraph (ii) or (iii),
TDSF will reimburse Licensee for its actual, reasonable out-of-pocket costs and
expenses incurred from the date the preliminary approval of the revoked item was
granted up to the date of the revocation of such approval.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.19.2 <U>Approving
Facility Design Elements, New Store Construction and Refurbishments</U>.
Licensee shall be required to obtain TDSF&#146;s written approval with respect
to all Facility Design Elements, whether in connection with (i) constructing,
building out, outfitting and opening a Facility ("<B>New Store
Construction</B>"), (ii) making Refurbishments to a Facility, or (iii)
otherwise modifying any aspect of the design or appearance of a Facility
<B>("Design Modifications</B>"), in accordance with the following
procedures: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Submissions</U>.
Licensee shall submit to TDSF for approval (i) a written proposal with respect
to the proposed New Store Construction, Refurbishment or Design Modifications,
as the case may be (the "<B>Design Proposal</B>"), which proposal shall include, to the
extent applicable, all plans, drawings, designs, artwork, photographs,
materials, samples and other media relating to all proposed Facility Design
Elements, including, without limitation, the size; square footage (except that
no approval shall be required for a Store Facility that has at least 2,250 but
not more than 7,500 square feet of net retail merchandising space that is open
to the general public); layout; departments and organization; carpeting and
flooring; furniture, fixtures and equipment; shelving; appliances; lighting;
color scheme; decor; signage; displays; cut-outs; window strips; multimedia;
check-out counters, registers and systems; and all other physical attributes (it
being understood that each of the foregoing attributes shall be subject to
TDSF's approval in its business judgment to the extent such attributes do not
use, bear, display or feature any Disney Properties); (ii) a budget setting
forth the estimated costs of such New Store Construction, Refurbishments or
Design Modifications, as the case may be; and (iii) all other background
information and supporting material as will be reasonably necessary, or as TDSF
may reasonably request, to allow TDSF to make an informed judgment and appraisal
for purposes of TDSF's approving or disapproving the Design Proposal. All such
materials shall be submitted to the individual so designated by TDSF.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b)<U> Approval</U>.
Provided that Licensee has fully complied with Section 9.19.2(a), TDSF shall
notify Licensee of its approval or disapproval of the Design Proposal within
twenty (20) Business Days following Licensee's submission of the information
required or requested to be submitted pursuant to Section 9.19.2(a).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Modification of
Design Proposal; Postponement or Revocation of Approval</U>. In the event that a
Design Proposal approved by TDSF pursuant to Section 9.19.2(b) or any of the
materials submitted to TDSF pursuant to Section 9.19.2(a) in connection with the
approval thereof, are (or, in light of changed circumstances, need to be)
modified or updated prior to the completion of the New Store Construction,
Refurbishments or Design Modifications, as the case may be, Licensee shall
submit a modified Design Proposal, together with any modified or new supporting
materials of the type described in Section 9.19.2(a). Provided that Licensee has
fully complied with this Section 9.19.2(c), TDSF shall notify Licensee of its
approval or disapproval of the modified Design Proposal within ten (10) Business
Days following Licensee's submission of the materials required or requested to
be submitted pursuant to this Section 9.19.2(c). In the event that (i) any such
modifications, (ii) any alleged or actual copyright and/or trademark
infringement or other Disney IP Claim or any other legal consideration or rights
dispute regarding any intellectual property, or (iii) any corporate brand
considerations, including without limitation, protection of the Disney
Properties or the "Disney" brand, name, reputation and quality requires, in
TDSF's sole discretion, the temporary postponement (or, if necessary,
revocation) of any previous approval, then TDSF shall be entitled to postpone or
revoke such approval by promptly notifying Licensee thereof; <U>provided</U>, that, in
the case of a revocation pursuant to the preceding subparagraphs (ii) or (iii),
TDSF will reimburse Licensee for its actual, reasonable out-of-pocket costs and
expenses incurred from the date the preliminary approval of the revoked item was
granted up to the date of the revocation of such approval.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) <U>Expedited
Facility Design Element Approval Process</U>. At any time and from time to time
during the Term, Licensee shall be entitled to submit to TDSF for approval
plans, drawings, designs, artwork, photographs, materials, samples and other
media that set forth or propose a combination of particular Facility Design
Elements (by way of illustration and not limitation, certain flooring,
furniture, fixtures and equipment, a specified color scheme and other selected
Facility Design Elements) to serve as a Facility design template to be used in
multiple Facilities (a "<B>Model Design</B>"). Any such Model Design so submitted by
Licensee shall be subject to TDSF's approval in its sole discretion (except to
the extent that certain Facility Design Elements are subject to TDSF's approval
in its business judgment as set forth in Section 9.3.6(a) or Section 9.19.2(a)).
TDSF shall notify Licensee of its approval or disapproval of the proposed Model
Design within forty-five (45) Business Days following Licensee's submission. In
addition, prior to the Effective Date, TDSF has provided Licensee with one (1)
or more Model Designs developed by and satisfactory to TDSF, including the
"Castle" Model Design (each, an "<B>Initial Model Design</B>"), and TDSF may (but shall
not be obligated to) provide Licensee with one (1) or more additional Model
Designs developed by and satisfactory to TDSF at such times during the Term as
TDSF may elect in its sole discretion. Licensee shall be entitled to use any
Model Design approved or provided by TDSF hereunder in connection with future
New Store Construction, Refurbishments or Design Modifications during the time
period specified by TDSF (which time period shall not be less than three (3)
calendar years) without re-submitting such Model Design for approval in
accordance herewith; <U>provided</U>, that (i) Licensee shall have the right to make
reasonable modifications to the layout of any approved Model Design solely for
the purpose of conforming the Model Design to the size and layout of the
particular Leased Property, provided, that, any modification to any Disney
Properties used therein shall be subject to TDSF's approval in its sole
discretion, (ii) Licensee shall remain obligated to submit and, to the extent
required by this Section 9.19.2, obtain TDSF's approval with respect to, the
other materials required under this Section 9.19.2 to be submitted with Design
Proposals in connection with such New Store Construction, Refurbishments or
Design Modifications (<U>e.g.</U>, for purposes of illustration and without limitation,
budget and cost information), <U>provided</U>, that, in the event that TDSF's approval
is required with respect to such other materials, TDSF shall notify Licensee of
its approval or disapproval thereof within ten (10) Business Days following
Licensee's submission of such materials, (iii) upon TDSF's request, Licensee
shall provide reasonably satisfactory evidence of its compliance with the
applicable Model Design (including, without limitation, the specifications and
quality standards thereof) and (iv) TDSF shall have the right in its sole
discretion to alter, modify, discontinue or terminate any Model Design at any
time (x) following the time period designated for use thereof by TDSF or (y)
prior to the expiration of such designated time period in the event that (I) any
alleged or actual copyright and/or trademark infringement or other Disney IP
Claim or any other legal consideration or rights dispute regarding any
intellectual property, or (II) any corporate brand considerations, including,
without limitation, protection of the Disney Properties or the "Disney" brand,
name, reputation and quality, requires, in TDSF's sole discretion, such
alteration, modification, discontinuation or termination of such Model Design.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) <U>Refurbishment
Costs</U>. Notwithstanding anything to the contrary herein, to the extent Licensee
proposes to make Refurbishments to one (1) or more Facilities pursuant to a
Model Design submitted by Licensee to TDSF for approval pursuant to Section
9.19.2(d), in evaluating such Model Design so submitted by Licensee, TDSF shall
not require Licensee to complete such Refurbishments pursuant to a Model Design
that would require Licensee to spend in connection therewith an amount in excess
of the reasonable cost for completing Refurbishments in accordance with any
Initial Model Design (the "<B>Maximum Refurbishment Amount</B>"), <U>provided</U>, that,
beginning effective with the second (2nd) Contract Year and continuing through
each and every Contract Year of the Term thereafter, the Maximum Refurbishment
Amount for each Contract Year shall be the Maximum Refurbishment Amount for the
immediately preceding Contract Year, as adjusted to reflect the increase, if
any, in the CPI in accordance with the CPI Adjustment Methodology.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.19.3 <U>Other Operational
Approvals</U>. Except as otherwise specifically provided in this Section 9.19
and except for any approval required with respect to Licensed Materials or
Disney Properties (for which the provisions of Sections 4 and 5 shall govern),
Licensee shall comply with the following procedures in obtaining TDSF&#146;s
approval with respect to any matter as to which such approval is required
pursuant to this Section 9 (each such matter as to which TDSF&#146;s approval is
required, an "<B>Approval Item</B>"): </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a)<U> Submissions</U>.
With respect to any Approval Item, Licensee shall submit to TDSF for approval a
written proposal with respect to the Approval Item (an "<B>Approval Item
Proposal</B>"), including all background information and supporting material as will
be reasonably necessary, or as TDSF may reasonably request, to allow TDSF to
make an informed judgment and appraisal for purposes of TDSF's approving or
disapproving the Approval Item Proposal. Without limiting the foregoing, in the
case of approval of any Approval Item Proposal that is a Contract, Licensee
shall submit an initial draft of the proposed Contract and shall, thereafter,
provide TDSF with each revised draft thereof that is distributed between the
parties thereto (redlined to reflect changes therein). TDSF shall have the right
to review and comment on all drafts of each such Contract, which comments must
be considered in good faith by Licensee, and the final version of each such
Contract shall be subject to approval by TDSF in its business judgment (unless,
with respect to any such particular Approval Item that is a Contract, a
different approval standard is otherwise provided in this Agreement, in which
case such other approval standard shall apply). All such materials (including
any Contracts) shall be submitted to the individual so designated by TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b)
<U>Approval</U>. Provided that Licensee has fully complied with Section
9.19.3(a), TDSF shall notify Licensee of its approval or disapproval of the
Approval Item Proposal within twenty (20) Business Days following Licensee's
submission of the materials required or requested to be submitted pursuant to
Section 9.19.3(a); provided, however, that with respect to any Contract, TDSF
shall notify Licensee of its approval or disapproval of such Contract within ten
(10) Business Days after the final version of such Contract is provided to TDSF. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>Modification of
Approval Item Proposal; Postponement or Revocation of Approval</U>. In the event
that an Approval Item Proposal approved by TDSF pursuant to Section 9.19.3(b) or
any of the materials submitted to TDSF pursuant to Section 9.19.3(a) in
connection with the approval thereof are (or, in light of changed circumstances,
need to be) modified or updated prior to the taking of any action with respect
to such Approval Item Proposal, Licensee shall submit a modified Approval Item
Proposal, together with any modified or new supporting materials of the type
described in Section 9.19.3(a). Without limiting the foregoing, in the event
that a modified Approval Item Proposal is a Contract, Licensee shall submit an
initial draft of such modified Contract, redlined to reflect changes to the form
of such Contract that was approved pursuant to Section 9.19.3(b), and shall,
thereafter, provide TDSF with each revised draft thereof that is distributed
between the parties thereto (redlined to reflect changes therein). Such Contract
shall be subject to the provisions applicable to Contracts set forth in Section
9.19.3(a) (including the approval standards set forth therein). Provided that
Licensee has fully complied with this Section 9.19.3(c), TDSF shall notify
Licensee of its approval or disapproval of the modified Approval Item Proposal
within ten (10) Business Days following Licensee's submission of the materials
required or requested to be submitted pursuant to this Section 9.19.3(c). In the
event that (i) any such modifications, (ii) any alleged or actual copyright
and/or trademark infringement or other Disney IP Claim or any other legal
consideration or rights dispute regarding any intellectual property, or (iii)
any corporate brand considerations, including, without limitation, protection of
the Disney Properties or the "Disney" brand, name, reputation and quality,
requires, in TDSF's sole discretion, the temporary postponement (or, if
necessary, revocation) of any previous approval, then TDSF shall be entitled to
postpone or revoke such approval by promptly notifying Licensee thereof,
<U>provided</U>, that in the case of a revocation pursuant to the preceding
subparagraphs (ii) or (iii), TDSF will reimburse Licensee for its actual,
reasonable out-of-pocket costs and expenses incurred by Licensee from the date
the preliminary approval of the revoked item was granted up to the date of the
revocation of such approval. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9.19.4 <U>Mandatory
Provisions in New Business Property Lease Agreements and Lease Extension
Arrangements</U>. Each New Business Property Lease Agreement and, to the extent
not already contained in any applicable Lease Agreement, each Lease Extension
Arrangement shall contain provisions satisfactory to TDSF in its sole discretion
that give effect to the following (**):
</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) <U>Acknowledgment
of No Obligation by TDSF</U>. Notwithstanding any rights of TDSF under the
applicable Lease Agreement and the relationship between TDSF and Licensee
hereunder, Landlord shall acknowledge that (other than with respect to any
express guarantee obligations of TDSF or any of its Affiliates under a
Disney-Guaranteed Lease) TDSF and its Affiliates have no obligations under such
Lease Agreement, <U>provided</U>, that this Section 9.19.4(a) shall not apply in the
case of any Lease Extension Arrangement that extends the term of a Lease
Agreement for a period of less than one (1) year; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) <U>TDSF's Right to
Enter and Occupy Facility</U>. TDSF (or its Representatives or Affiliates) shall,
without the consent of Licensee or the applicable Landlord but subject to such
customary and reasonable requirements of such Landlord as may be set forth in
such Lease Agreement, have the right to enter and occupy the Business Property
that is the subject of the applicable Lease Agreement for the purpose of
effectuating repairs or alterations to such Business Property so long as such
repairs or alterations are allowed to be made by Licensee under such Lease
Agreement; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) <U>TDSF's Right to
Cure Default</U>. Following any event or circumstance that constitutes (or that with
the passage of time or the giving of notice or both would become) an event of
default under a Lease Agreement, TDSF (or its designated Representatives or
Affiliates) shall have the right, but not the obligation, to cure such default;
and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) <U>TDSF's Right to
Transfer Upon License Termination</U>. If this Agreement expires or is earlier
terminated, Landlord's consent to a Transfer of the applicable Lease Agreement
(or to a change of control of the tenant thereunder) (i) in the case of a
Transfer to TDSF or any of its Affiliates, shall not be required, and (ii) in
the case of a Transfer to any other Person, shall not be unreasonably withheld,
regardless of whether the request for such consent is made by Licensee or by
TDSF or any of its Affiliates. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
9.19.5 <U>General Terms
Applicable to TDSF Approval of All Operational Submissions</U>. Notwithstanding
anything contained herein to the contrary, with respect to all submissions by
Licensee under this Section&#160;9.19, Licensee acknowledges and agrees that:
(i)&#160;the approval or disapproval of any such submission shall be at
TDSF&#146;s sole discretion (unless the specific covenant under which Licensee
requests approval specifies TDSF&#146;s business judgment rather than
TDSF&#146;s sole discretion); (ii)&#160;if any submission is disapproved by
TDSF, where such submission by Licensee would be permissible in accordance with
the terms of this Agreement if modified, TDSF shall, to the extent feasible (and
in any event with respect to a substantial number of submissions), propose in
writing alternative suggestions and recommendations with respect thereto for the
purpose of providing Licensee an opportunity to correct such submission and
re-submit it to TDSF; (iii)&#160;any submission not receiving the specific
written approval of TDSF shall be deemed disapproved; (iv) no failure of TDSF to
respond within a specified time period shall be deemed a breach of or default
under this Agreement by TDSF under any circumstances; (v)&#160;any submission
receiving approval by TDSF will not constitute or imply a representation or
belief by TDSF that such submission complies with any applicable Laws and/or
other policies issued by any Governmental Entity, which compliance shall be the
sole responsibility of Licensee and, in connection therewith, Licensee shall, at
its sole cost and expense, obtain any required consents, approvals, permits,
licenses or other authorizations that may be required by any Governmental Entity
or applicable Law; (vi)&#160;any approval by TDSF of a submission may be
expressed in an informal written manner, such as by way of a TDSF Representative
placing his or her signature and the word "approved" directly upon the
proposed submission or by a TDSF Representative providing written approval via
electronic mail or fax; (vii) any materials required to be submitted in
connection with any approval process under this Section&#160;9.19 may be
submitted to TDSF in parts or stages over time rather than submitting all of the
required materials at one time (so long as Licensee shall note clearly in
writing that such submission is a partial submission) and, upon Licensee&#146;s
written request, TDSF will grant preliminary approvals or disapprovals (in
accordance with the provisions of this Section&#160;9.19) of any partial
submission made under this Section&#160;9.19 in order to permit Licensee to
proceed to the next stage of the proposed activity, <U>provided</U>, that TDSF
shall reserve its final approval or disapproval decision until all materials
have been submitted for its review as required under this Section&#160;9.19, and
TDSF may modify or revoke any preliminary approval without obligation or
liability to, or remedy or recourse by, Licensee, it being acknowledged and
agreed by Licensee that any such preliminary approvals or disapprovals are
solely an accommodation to Licensee at its request and that Licensee shall rely
on any such preliminary approvals or disapprovals at its own risk; and (viii)
any use of Disney Properties or Licensed Materials required in connection with
any operational matter submitted by Licensee in connection with any approval
process under this Section&#160;9.19 shall be subject to the approval provisions
set forth in Section&#160;5 in addition to the approval provisions set forth in
this Section&#160;9.19. </FONT></P>

<P><FONT SIZE=3>10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>CUSTOMER DATA</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.1 <U>Definition of Customer Data</U>. As used in this Agreement, "<B>Customer
Data</B>" shall mean all information (including, without limitation,&#160;names,
addresses, e-mail addresses, telephone numbers, dates of birth, transaction
data, demographic data, behavioral data, customer service data, correspondence
and other documents and information) obtained from customers and maintained in
Licensee&#146;s or its Affiliates&#146; books and records in connection with (i)
their purchases of Disney Merchandise at the Facilities or through the Internet
Store and (ii) any other transactions entered into by such customers at the
Facilities or through the Internet Store (<U>e.g.</U>, Internet Store
registration, sweepstakes registrations, customer surveys), in each case to the
extent obtained in accordance with any applicable Laws, the Disney Privacy
Policy and any Customer Elections. The Customer Data shall be treated, kept and
maintained by each party as Confidential Information in accordance with the
terms of Section&#160;17.2, subject to each party&#146;s rights as set forth in
this Section&#160;10. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.2 <U>Ownership and Use of Customer Data</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.2.1 <U>During the Term</U>. During the Term only, TDSF and Licensee shall be
deemed to be the joint owners of the Customer Data, <U>provided</U>, that (i)
Licensee shall use the Customer Data solely for purposes of operating the
Business and fulfilling its obligations under this Agreement, (ii) TDSF and its
Affiliates may use the Customer Data for any business purpose of TDSF or any of
its Affiliates, <U>provided</U>, that TDSF and its Affiliates shall not use the
Customer Data obtained hereunder for purposes of marketing, advertising or
promoting the DDM Business or any Primary Disney Retail Store, and (iii) any use
by Licensee or TDSF (or any of their respective Affiliates) of the Customer Data
shall be in compliance with all applicable Laws, the Disney Privacy Policy and
all Customer Elections. Without limiting the foregoing, Licensee shall not
(a)&#160;Transfer or otherwise provide to any third party (a "<B>Data
Transfer</B>") any Customer Data, other than to (I)&#160;TDSF or any of its
Affiliates or (II)&#160;any third party agents who are providing services to
Licensee or any of its Affiliates in connection with the operation of the
Business, <U>provided</U>, that Licensee shall ensure that each such third party
agent shall (A)&#160;obtain no ownership rights or interests in such Customer
Data, (B)&#160;return such Customer Data to Licensee after it has provided
services in connection with the Business, (C)&#160;be subject to the same
restrictions on Data Transfers, solicitations, marketing, advertising and
promotional campaigns, and other uses as apply to Licensee under this
Section&#160;10.2.1 and to confidentiality provisions with respect to such
Customer Data reasonably comparable to the provisions set forth in Section 17.2,
and (D)&#160;keep and maintain such Customer Data in accordance with all
applicable Laws, the Disney Privacy Policy and all Customer Elections, or
(b)&#160;unless otherwise approved by TDSF in accordance with Section 5, use any
Customer Data for any type of solicitation, any marketing, advertising or
promotional campaign, or any use not related to the operation of the Business.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.2.2 <U>Following Expiration or Termination</U>. Upon the date of expiration
or earlier termination of this Agreement, (i)&#160;TDSF shall be, and be deemed
to be, the sole and exclusive owner of the Customer Data, (ii) Licensee shall,
as soon as reasonably practicable, provide to TDSF, at Licensee&#146;s sole cost
and expense and in such manner and in such formats as TDSF reasonably requests,
all Customer Data that Licensee has not previously provided to TDSF in
accordance with Section 10.3, and (iii) following its completion of the actions
set forth in subparagraph (ii) of this Section 10.2.2, Licensee shall destroy
and/or delete all Customer Data from its books, records and databases, except to
the extent Licensee is required to maintain any Customer Data pursuant to
applicable Law (in which event Licensee shall only retain and use such retained
Customer Data as and to the extent required by applicable Law). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.2.3 <U>Data Obtained Independently by TDSF</U>. Nothing contained in this
Section&#160;10 or elsewhere in this Agreement shall apply to, or limit or
prohibit the use in any manner of, any information or data owned or held by TDSF
or any of its Affiliates to the extent such information or data has been
independently obtained by TDSF or any of its Affiliates from a source other than
Licensee or any of its Affiliates or the Business, even if such information or
data is duplicative of Customer Data. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.3 <U>Provision of Information by Licensee to TDSF</U>. During the Term, (i)
on a Retail Monthly basis within twenty (20) Business Days following the end of
each Retail Month during the Term in respect of the preceding Retail Month,
Licensee shall provide updated Customer Data to TDSF, including, without
limitation, all new names and related information acquired during the preceding
Retail Month, at Licensee&#146;s sole cost and expense and in such manner and in
such formats as TDSF reasonably requests, and (ii) Licensee shall take all such
actions as TDSF reasonably requests to facilitate such provision of Customer
Data;
<U>provided</U>, that all actions by Licensee pursuant to this Section&#160;10.3
shall be subject to all applicable Laws, the Disney Privacy Policy and all
Customer Elections. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
10.4 <U>Approval of Direct Marketing Activities</U>. Licensee acknowledges and
agrees that any direct marketing activities conducted by Licensee or its
Affiliates in connection with the Business, including, without limitation, mail,
telephone or internet solicitations and activities relating to the Internet
Store, whether or not using Customer Data and/or Licensed Materials, shall
require the prior written consent of TDSF in each instance pursuant to Section
5. In connection with any such direct marketing activities conducted by Licensee
or its Affiliates in connection with the Business, Licensee shall be entitled to
use, in addition to Customer Data, comparable information obtained from
customers of the business of TCP and its Affiliates (other than the Licensee
Entities), subject to Licensee&#146;s compliance with applicable Law, any
privacy elections made by such customers and any privacy policy applicable to
such information and provided that Licensee&#146;s use of such customer data of
TCP shall not by itself provide Licensee with any rights of ownership therein.
Notwithstanding the foregoing, none of TCP or its Affiliates (other than the
Licensee Entities) shall have any right to use Customer Data in connection with
direct marketing activities conducted by TCP or such Affiliates or any other
activities, except and only to the extent approved in writing by TDSF in its
sole discretion, which approval may be conditioned upon TCP&#146;s and such
Affiliates&#146; compliance with certain limitations and restrictions,
including, without limitation, the time periods during which such direct
marketing activities may occur and the frequency and content of such direct
marketing activities. </FONT></P>

<P><FONT SIZE=3>11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>OWNERSHIP OF CERTAIN TECHNOLOGY AND PRODUCT DESIGN ELEMENTS</U>.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.1 <U>Definitions</U>. As used herein, the following terms have the meanings
set forth below: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Non-Disney Technology and Elements</B>" shall mean, collectively, (i) all
proprietary technology embedded in the Disney Merchandise and developed
specifically for the Business, including, without limitation, any related
specifications, functional requirements, documentation, copyrights and copyright
applications, patents and patent applications, trade secret rights, trademarks
and trademark applications (for the name(s) of the technology itself as opposed
to the name(s) of the Disney Merchandise in which it is embedded) and other
related intellectual property rights, and (ii) the style, design, size, shape,
color, trade dress, industrial designs, merchandise designs, merchandise tools
(<U>i.e.</U>, molds, dies, etc.), appearance and other comparable aesthetic
features of the Disney Merchandise (collectively, the "<B>Product Design
Elements</B>"), including, without limitation, any related copyrights and
copyright applications, patents and patent applications, inventions (whether or
not patentable), trade secret rights, trademarks and trademark applications (for
the name(s) of the Product Design Element itself as opposed to the name(s) of
the Disney Merchandise in which it is embedded) and other related intellectual
property rights (<U>provided</U>, that this subparagraph (ii) shall not include
any Product Design Elements that are based on, embody, contain, feature,
display, reflect or express, directly or indirectly, in whole or in part, by
direct reference or by inference (<U>e.g.</U>, by shape or outline but without
specific features), any of the Licensed Materials or any other names, brands,
trademarks, logos, symbols, characters or other proprietary designations or
intellectual property of TDSF or any of its Affiliates, which Product Design
Elements shall be, and be deemed to be, solely and exclusively owned by TDSF and
shall be reserved to TDSF with unlimited rights to use and exploit the same at
any time (whether during the Term or thereafter) with no duty to account to
Licensee and shall be otherwise subject to the provisions of this Agreement as
"Licensed Materials," including, without limitation, Section&#160;4.4).
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Product Trademarks</B>" shall mean any and all names, brands, trademarks,
logos, symbols or other proprietary designations or intellectual property used
to identify, and developed specifically for, the Disney Merchandise, including,
without limitation, all registrations thereof, applications to register the
same, common law rights therein and the goodwill associated therewith;
<U>provided</U>, that "Product Trademarks" shall not include (in whole
or in part) any names, brands, trademarks, logos, symbols or other proprietary
designations or intellectual property that are owned by TDSF or any of its
Affiliates separately and independently from this Agreement (such as, by way of
example and without limitation, the Licensed Materials). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of illustration only and without limitation, if an Article of
Disney Merchandise consisted of a toddler&#146;s cup with a specially designed
no-drip lid, a cup handle shaped like a generic trumpet (without reference to
any Licensed Materials), and a carrying case shaped like the ears of Mickey
Mouse (but without the features of Mickey Mouse&#146;s face), and such Disney
Merchandise is called "Dizzy&#146;s No-Drip Cup", then (i) the no-drip lid and
the generic trumpet-shaped handle would be Non-Disney Technology and Elements,
(ii) the Mickey Mouse-inspired carrying case would constitute Licensed Materials
and would not be Non-Disney Technology and Elements (even though it does not
bear the exact features of Mickey Mouse), and (iii) the name "Dizzy&#146;s
No-Drip Cup" would be a Product Trademark. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.2 <U>Non-Disney Technology and Elements Ownership and License Rights</U>. As
between TDSF and Licensee, subject to the rights of any licensors or other third
parties: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.2.1 Licensee shall be, and be deemed to be, the sole and exclusive owner of
all Non-Disney Technology and Elements with respect to which substantially all
development costs and expenses have been borne by Licensee and/or any of its
Affiliates; <U>provided</U>, that, both&#160;during the Term and thereafter, (i)
Licensee shall, upon the request of TDSF or any Other Disney Store Operator,
grant TDSF and its Affiliates (but, for the avoidance of doubt, not any third
party licensees of TDSF or its Affiliates within the Territory) or any Other
Disney Store Operator and its Affiliates, respectively, a non-exclusive license
to use any such Non-Disney Technology and Elements at a fair-market royalty rate
to be negotiated in good faith by such parties (or any of their respective
Affiliates), <U>provided</U>, that TDSF shall not, and shall not permit its
Affiliates to, sublicense any rights granted thereto pursuant to this
subparagraph (i) of this Section 11.2.1 to any of their respective third party
licensees within the Territory (but, for purposes of clarification, TDSF and its
Affiliates shall be permitted to sublicense any rights granted thereto pursuant
to this subparagraph (i) of this Section 11.2.1 to any of their respective third
party licensees outside of the Territory), and (ii) Licensee shall be permitted
to license any such Non-Disney Technology and Elements to third parties within
or outside of the Territory for use in connection with consumer products and
merchandise that are not Disney Merchandise so long as such Non-Disney
Technology and Elements are not, as determined by TDSF in its business judgment,
likely to be perceived by the public as closely associated with or attributable
to, as applicable, Disney Merchandise, Licensed Materials, any Disney
Properties, any other names, brands, trademarks, logos, symbols, characters or
other proprietary designations or intellectual property of TDSF or any of its
Affiliates, the Facilities or the Internet Store; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.2.2 TDSF shall be, and be deemed to be, the sole and exclusive owner of all
Non-Disney Technology and Elements with respect to which substantially all
development costs and expenses have been borne by TDSF and/or any of its
Affiliates; <U>provided</U>, that, during the Term only, TDSF shall, upon
Licensee&#146;s request, grant Licensee and its Affiliates a non-exclusive
license to use any such Non-Disney Technology and Elements solely for purposes
of carrying out Licensee&#146;s obligations under this Agreement, at a
fair-market royalty rate to be negotiated in good faith by the parties hereto
(or any of their respective Affiliates), <U>provided</U>, that, for purposes of
clarification, (i) Licensee shall not, and shall not permit its Affiliates to,
sublicense any rights granted thereto pursuant to this Section 11.2.2 to any
Person, and (ii) TDSF shall be permitted to license any such Non-Disney
Technology and Elements to any Person within or outside of the Territory,
including, without limitation, a Person who competes directly or indirectly with
Licensee or its Affiliates; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.2.3 With respect to any Non-Disney Technology and Elements that are jointly
developed by TDSF or any of its Affiliates, on the one hand, and Licensee or any
its Affiliates, on the other hand (for these purposes, "joint development"
meaning that each party has devoted a material amount of resources, whether in
the form of technical expertise, personnel, financial resources or otherwise, to
the development of the Non-Disney Technology and Elements), Licensee and TDSF
shall be deemed to be the joint owners of such Non-Disney Technology and
Elements, each with unlimited rights to use, exploit and sublicense the same so
long as, in the case of any such sublicense by Licensee, such Non-Disney
Technology and Elements are not, as determined by TDSF in its business judgment,
likely to be perceived by the public as closely associated with or attributable
to, as applicable, Disney Merchandise, Licensed Materials, any Disney
Properties, any other names, brands, trademarks, logos, symbols, characters or
other proprietary designations or intellectual property of TDSF or any of its
Affiliates, the Facilities or the Internet Store. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.3 <U>Product Trademark Ownership</U>. As between TDSF and Licensee, subject
to the rights of any licensors or other third parties, TDSF shall be, and be
deemed to be, the sole and exclusive owner of all Product Trademarks, which are
reserved to TDSF with unlimited rights to use and exploit the same at any time
(whether during the Term or thereafter) and with no duty to account to Licensee,
<U>provided</U>, that, during the Term and within the Territory only, TDSF
hereby grants to Licensee and its Affiliates a non-exclusive, royalty-free
license to use all such Product Trademarks solely for purposes of carrying out
Licensee&#146;s obligations under the terms of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.4 <U>Further Assurances</U>. Each of the parties hereto agrees to execute and
deliver to the other party such assignments and other conveyance documents as
may be required and reasonably requested from time to time by the other party to
confirm the other party&#146;s ownership of Non-Disney Technology and Elements
and Product Trademarks. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11.5 <U>Survival of Section</U>. The provisions of this Section&#160;11 shall
survive the expiration or earlier termination of this Agreement indefinitely.
</FONT></P>

<P><FONT SIZE=3>12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>INDEMNIFICATION</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1 <U>Indemnification by Licensee</U>. Each of TDS USA and TDS Canada, jointly
and severally, shall defend, indemnify and hold TDSF and each of its Affiliates
and the officers, directors, agents, representatives, employees, successors and
assigns of each, forever harmless from and against any and all third-party
claims, damages, losses, liabilities, obligations, settlements, injunctions,
suits, actions, proceedings, liens, demands, charges, fines, penalties, costs
and expenses of every kind and nature (whether based on tort, breach of
contract, product liability, patent or copyright infringement or otherwise),
including, without limitation, reasonable fees and expenses of attorneys and
other professionals and disbursements that may be imposed on, incurred by or
asserted against the Persons hereby required to be indemnified (but not against
any of the same to the extent that a negligent act or omission or willful
misconduct of any such Person was the cause of same) (collectively, "Loss"),
arising directly or indirectly from, out of or based on: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.1 any failure by Licensee to perform any of the agreements, terms,
covenants or conditions of this Agreement to be performed by Licensee or any
breach of any representation or warranty made by Licensee in this Agreement,
including, without limitation, any Material Breach, any Licensee Infringing Use
and/or any use of any music or film clip rights acquired from TDSF or its
Affiliates in connection with this Agreement that constitutes an infringing use
thereof or that is in violation of this Agreement or in violation of any
Contract entered into in connection with such music or film clip rights; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.2 the use by TDSF or its Affiliates of Licensee&#146;s names, brands,
trademarks, logos, symbols, characters, designs, copyrights, materials, plans,
ideas or other proprietary designations or intellectual property, <U>provided</U>, that
such use was in accordance with the terms and conditions of this Agreement or as
otherwise permitted by Licensee; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.3 any applicable Taxes (including, without limitation, sales, use,
withholding (imposed by Canada or any other non-U.S. taxing jurisdiction),
value-added or other similar Taxes) arising in connection with the payment of
the Licensee Payments or other payments due to TDSF hereunder by Licensee or in
connection with this Agreement, regardless of whether such Taxes must be
collected by TDSF or its Affiliates on behalf of the applicable taxing authority
and regardless of whether Licensee shall challenge the assessment or amount of
such Taxes, except for any local, state, provincial or federal income Taxes (or
franchise, gross receipts or other similar Taxes imposed in lieu of net income
Taxes), other than withholding Taxes imposed by Canada or any other non-U.S.
taxing jurisdiction, payable by TDSF or its Affiliates on, or in respect of, the
Licensee Payments; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.4 the creation, development, manufacture, sourcing, purchase, offer for
sale, sale or use of any Disney Merchandise or any other products or services of
Licensee or its Affiliates, whether intended or unintended, and any injury to
person or property or illness or death allegedly resulting therefrom, including,
without limitation, (i) the manufacture, assembly and delivery of such Disney
Merchandise or other products or services, (ii) any alleged deficiency or
inadequacy in any instructions, warnings, labels or other materials included
with any such Disney Merchandise or other products or services, (iii) the
fitness of any such Disney Merchandise or other products or services for its
intended use by consumers, (iv) any defect in design, material or workmanship of
such Disney Merchandise or other products or services, (v) any misbranding,
adulteration or unsafe feature of such Disney Merchandise or other products or
services, (vi) any failure of such Disney Merchandise or other products or
services to comply with any applicable Laws, including, without limitation, Laws
pertaining to articles, materials or substances banned from commerce into or
within the Territory, (vii) any breach of any Manufacturer&#146;s Agreement or
Manufacturer&#146;s MOU by any Manufacturer or Licensee; or (viii) any name,
brand, trademark, trade name, trade dress, logo, symbol, character, patent,
copyrighted work, trade secret, music right, film clips or other proprietary
designation or intellectual property used in connection with the Disney
Merchandise or such other product or service (other than the Licensed Materials
to the extent and only to the extent to which TDSF has indemnified Licensee
pursuant to Section 12.2.2); or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.5 the maintenance, management, supplying, administering and operation of
the Business Properties and the Business and all activities related thereto, and
any injury to person or property or illness or death allegedly resulting
therefrom; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.6 the staffing of the Business Properties and the Business and all
activities related thereto, including, without limitation, the compensation,
hiring and termination of Licensee Employees and any other activities described
in Section 9.4.1; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.7 any breach or violation of or failure to comply with any representation,
warranty, term, covenant or condition contained in any Lease Agreement or other
Contract of Licensee or its Affiliates pertaining to the Business, including,
without limitation, reimbursement of TDSF and/or its Affiliates for any amounts
paid by any of them under any guarantee of a Lease Agreement; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.8 the conduct of any marketing, advertising or promotional activity or
sales process hereunder by or on behalf of Licensee or its Affiliates,
including, without limitation, the production and broadcast of any television or
radio commercials in connection therewith, direct-to-consumer solicitations via
mail, email or otherwise, any marketing, advertising or promotion on or through
the Internet Store and the promotion, advertising, marketing, offering for sale
and sale of Theme Park Admission Passes; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.9 any negligent act or omission or willful misconduct by Licensee or its
Affiliates, or the officers, directors, agents or employees of each, in
connection with its or their performance relating to this Agreement; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.1.10 the operation by Licensee of the Facilities or by TCP or its Affiliates,
other than Licensee, of any retail location or other venue of TCP or such
Affiliates; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>provided</U>, that, notwithstanding the foregoing, TDS USA and TDS Canada
shall not be required to defend, indemnify or hold TDSF, its Affiliates or the
officers, directors, agents, representatives, employees, successors and assigns
of each harmless from or against any third-party Loss arising from, out of or
based on any of the foregoing matters if and only if and only to the extent to
which TDSF or any of its Affiliates is required to indemnify Licensee, any of
its Affiliates or the officers, directors, agents, representatives, employees,
successors and assigns of each with respect to any such matters pursuant to the
terms of the Acquisition Agreement or Section&#160;12.2 of this Agreement.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.2 <U>Indemnification by TDSF</U>. TDSF shall defend, indemnify and hold
Licensee and each of its Affiliates and the officers, directors, agents,
representatives, employees, successors and assigns of each, forever harmless
from and against any and all third-party Loss arising directly or indirectly
from, out of or based on: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.2.1 any failure by TDSF to perform any of the agreements, terms, covenants or
conditions of this Agreement to be performed by TDSF or any breach of any
representation or warranty made by TDSF in this Agreement; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.2.2 use of the Disney Properties and the Licensed Materials by Licensee, but
if and only if (A)&#160;such use was in strict accordance with the terms and
conditions of this Agreement (and in the exact form and manner approved
hereunder by TDSF) and (B)&#160;either (i) such use infringes the copyright of
any third party or (ii) such use consists of the use of the name "Disney" or the
designs of the "Mickey Mouse," "Minnie Mouse," "Donald Duck," "Daisy Duck" and
"Goofy" animated characters and it infringes the trademark of a third party. In
the case of this Section 12.2.2, (a) Loss shall not include lost profits and (b)
except as specifically provided under subparagraph (B)(ii) of this Section
12.2.2, no warranty or indemnity is being given by TDSF with respect to any Loss
arising from any claim that use of the Disney Properties or the Licensed
Materials or any other proprietary designations or intellectual property owned
by or licensed to TDSF or any of its Affiliates on or in connection with the
Disney Merchandise, the FF&amp;E Materials, the Marketing Materials or any other
materials approved hereunder by TDSF infringes on any trademark or other right
of any third party or otherwise constitutes unfair competition; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.2.3 any local, state, provincial or federal income Taxes (or franchise, gross
receipts or other similar Taxes imposed in lieu of net income Taxes), other than
withholding Taxes imposed by Canada or any other non-U.S. taxing jurisdiction,
payable by TDSF or its Affiliates on, or in respect of, the Licensee Payments;
or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.2.4 the operation by TDSF or its Affiliates of any Theme Park or other retail
or entertainment venue that is solely owned and controlled by TDSF or its
Affiliates; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 12.2.5 **; or
</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>


<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.2.6 any negligent act or omission or willful misconduct by TDSF or its
Affiliates, or the officers, directors, agents or employees of each, in
connection with its or their performance relating to this Agreement; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>provided</U>, that, notwithstanding the foregoing, TDSF shall not be required
to defend, indemnify or hold Licensee, its Affiliates or the officers,
directors, agents, representatives, employees, successors and assigns of each
harmless from or against any third-party Loss arising from, out of or based on
any of the foregoing matters if and only if and only to the extent to which TCP,
Licensee Parent, Canadian Parent or Licensee is required to indemnify TDSF, any
of its Affiliates or the officers, directors, agents, representatives,
employees, successors and assigns of each with respect to any such matters
pursuant to the terms of the Acquisition Agreement or Section 12.1 of this
Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.3 <U>Procedures of Indemnification</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.3.1 Either party seeking indemnification under this Agreement (the
"<B>Indemnified Party</B>") shall give notice to the party required to provide
indemnification hereunder (the "<B>Indemnifying Party</B>") promptly after the
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought hereunder, and the Indemnified Party shall permit the Indemnifying Party
(at the expense of the Indemnifying Party), if it acknowledges in writing its
liability with respect to defense costs, to assume the defense of any claim or
litigation resulting therefrom; <U>provided</U>, that (i)&#160;counsel for the
Indemnifying Party who shall conduct the defense of such claim or litigation
shall be satisfactory to the Indemnified Party in its business judgment;
(ii)&#160;the Indemnified Party may participate in such defense, represented by
counsel of the Indemnified Party&#146;s own choosing, but only at the
Indemnified Party&#146;s own cost and expense, except with respect to any claim
or litigation by or with a Governmental Entity involving or relating to any Tax
matter; and (iii)&#160;the omission by the Indemnified Party to give notice as
provided herein shall not relieve the Indemnifying Party of its indemnification
obligations hereunder except to the extent that such omission results in a
failure of actual notice to the Indemnifying Party and the Indemnifying Party is
actually prejudiced or damaged as a result of such failure to give notice.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.3.2 The Indemnifying Party shall not, except with the written consent of the
Indemnified Party, consent to entry of any judgment or administrative order or
enter into any settlement or a compromise that would bind the Indemnified Party
if such judgment, administrative order, settlement or compromise (i)&#160;could
affect the validity or enforceability of any intellectual property rights or
other business interests of the Indemnified Party, (ii)&#160;does not include as
an unconditional term thereof the giving by the claimant or plaintiff to the
Indemnified Party of a release from all liability with respect to such claim or
litigation, or (iii)&#160;would require any admission of wrongdoing on the part
of the Indemnified Party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.3.3 Subject to TDSF&#146;s rights pursuant to Section 4.8 with respect to
Disney IP Claims, in the event that the Indemnified Party shall in its business
judgment determine that the conduct of the defense of any claim subject to
indemnification hereunder or any proposed settlement of any such claim by the
Indemnifying Party might be expected to affect adversely the Indemnified
Party&#146;s intellectual property rights or ability to conduct future business,
the Indemnified Party shall have the right at all times to take over and assume
control over the defense, settlement, negotiations or lawsuit relating to any
such claim at the sole cost and expense of the Indemnifying Party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.3.4 In the event that the Indemnifying Party does not acknowledge in writing
its indemnification obligation hereunder and accept the defense of any matter as
above provided within ten (10) Business Days following written notice from the
Indemnified Party of any such matter, the Indemnified Party, without waiving any
rights under this Section&#160;12, shall have the full right to defend against
any such claim or litigation at the reasonable expense of the Indemnifying
Party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
12.4 <U>Survival</U>. The provisions of this Section&#160;12 shall survive the
expiration or earlier termination of this Agreement for three (3) years
following the date of such expiration or termination of this Agreement.
</FONT></P>

<P><FONT SIZE=3>13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>TERMINATION BY TDSF</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Without prejudice to any other right or remedy available to TDSF at law or in
equity in respect of any event described below (but subject to the limitations
set forth in Section&#160;21.22), this Agreement may be terminated by TDSF by
written notice to Licensee upon the occurrence of one (1) or more of the
following events: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.1 <U>Royalty Breach</U>. Either (i) Licensee shall commit any Royalty Breach
that is not Cured by Licensee, (ii) during the first twenty-four (24) Retail
Months of the Term, Licensee shall commit four (4) or more Royalty Breaches,
whether Cured or Uncured by Licensee, or (iii) during any rolling twenty-four
(24) Retail Month period during the remainder of the Term, Licensee shall commit
three (3) or more Royalty Breaches, whether Cured or Uncured by Licensee; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.2 <U>Misuse of Licensed Materials</U>. During any rolling twenty-four (24)
Retail Month period during the Term, either (i) Licensee shall commit ** or more
Licensee Infringing Uses that are not Cured by Licensee, or (ii) Licensee shall
commit ** or more Licensee Infringing Uses, whether Cured or Uncured by
Licensee; or </FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>_____________________<BR>
<I>** This information is confidential and has been omitted and
separately filed with the Securities and Exchange Commission.</I></FONT></P>



<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.3 <U>Material Breach</U>. During any rolling twenty-four (24) Retail Month
period during the Term, either (i) Licensee shall commit five (5) or more
Material Breaches that are not Cured by Licensee or (ii) Licensee shall commit
seven (7) or more Material Breaches, whether Cured or Uncured by Licensee, in
each case other than any breaches described in Section 13.1, 13.2, 13.9 or
13.10; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.4 <U>Assignment</U>. Any purported assignment or Transfer of Licensee&#146;s
rights, benefits or obligations hereunder shall be made or deemed to be made
that is in violation of this Agreement; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.5 <U>Change of Control</U>. Following the Effective Date, (i) Licensee,
Licensee Parent, Canadian Parent or any of their respective Subsidiaries shall,
in any single transaction or series of related transactions, Transfer (by lease,
management or operation agreement, assignment, sale or otherwise) all or
substantially all of its properties and assets to a Qualified Person without a
Guaranty Assumption and, in the case of a Transfer involving Licensee Parent,
Canadian Parent or Licensee, a License Assumption or to any Disqualified Person;
(ii) TCP or any of its Affiliates (other than the Licensee Entities) shall, in
any single transaction or series of related transactions, Transfer (by lease,
management or operation agreement, assignment, sale or otherwise) all or
substantially all of its properties and assets used primarily in the Business to
a Qualified Person without a Guaranty Assumption or to any Disqualified Person;
(iii)&#160;Licensee, Licensee Parent, Canadian Parent, TCP or any of their
respective Affiliates shall enter into any merger, consolidation, amalgamation,
combination or other comparable form of corporate transaction with a Qualified
Person without a Guaranty Assumption and a License Assumption or with any
Disqualified Person; (iv) any Licensee Securities or Licensee Affiliate
Securities shall be Transferred by any Person other than pursuant to a Permitted
Transfer; or (v) any TCP Securities or TCP Affiliate Securities shall be
Transferred by any Person other than pursuant to a Permitted Transfer;
<U>provided</U>, that, in the event that TDSF shall have a right of termination
under the preceding subparagraph (v) of this Section 13.5, (A) the termination
of this Agreement pursuant to this Section&#160;13.5 shall not occur until the
date that is twelve (12) months from the date Licensee or its Affiliates knew or
(based upon diligent inquiry) should reasonably have known of such prohibited
Transfer so long as, until such termination date, TCP shall use its good faith,
commercially reasonable efforts to Transfer all of its right, title and interest
in and to Licensee Parent, Licensee, Canadian Parent and their respective
Subsidiaries, the Facilities, the Internet Store and the Business (whether by
Transfer of all outstanding Licensee Securities, Licensee Parent Securities
and/or Canadian Parent Securities or substantially all of Licensee&#146;s
properties and assets or otherwise) in a manner that does not violate the terms
of subparagraphs (i), (iii) or (iv) of this Section 13.5, as applicable, such
efforts of TCP to be demonstrated to TDSF&#146;s satisfaction in its business
judgment on at least a monthly basis, (B) the time period in the preceding
subparagraph (A) shall be extended by three (3) months in the event that, prior
to the expiration of the initial twelve (12) month period under the preceding
subparagraph (A), TCP or its Affiliates shall have in good faith entered into a
written, binding, definitive agreement with an unrelated third party pertaining
to a Transfer as contemplated by the preceding subparagraph (A), which agreement
shall be subject only to customary closing conditions for a transaction of that
nature (<U>e.g.</U>, regulatory approvals, material accuracy of representations
and warranties, landlord consents), and (C) so long as any such Transfer as
contemplated by the preceding subparagraph (A) is consummated within the time
period specified in such subparagraph (or any extension thereof pursuant to the
preceding subparagraph (B)), then TDSF&#146;s right of termination under
subparagraph (v) of this Section 13.5 shall expire upon the consummation of such
Transfer. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.6 <U>Insolvency</U>. Either (i) any of (a) TDS USA, TDS Canada, Licensee
Parent, Canadian Parent or any of their respective Subsidiaries, (b) TCP, any
Significant Subsidiary of TCP or any Subsidiary of TCP that is engaged in the
Business in any manner or (c) any Parent Affiliate of TCP shall become Insolvent
or shall make an assignment for the benefit of creditors; or (ii) any action
shall be brought by any such Person seeking its dissolution or liquidation of
any of its assets or seeking the appointment of a trustee, interim trustee,
receiver or other custodian for any of its property; or (iii) any such Person
shall commence a voluntary proceeding under the Federal Bankruptcy Code; or (iv)
any reorganization or arrangement proceeding is instituted by any such Person
for the settlement, readjustment, composition or extension of any of its debts
upon any terms; or (v) any action or petition shall otherwise be brought by any
such Person seeking similar relief or alleging that it is Insolvent or unable to
pay its debts as they mature; or (vi) any action shall be brought against any
such Person seeking its dissolution or liquidation of any of its assets, or
seeking the appointment of a trustee, interim trustee, receiver or other
custodian for any of its property, and any such action is consented to or
acquiesced in by any such Person or is not dismissed within two (2) months after
the date upon which it was instituted; or (vii) any proceeding under the Federal
Bankruptcy Code shall be instituted against any such Person, and (x) an order
for relief is entered in such proceeding or (y) such proceeding is consented to
or acquiesced in by any such Person or is not dismissed within two (2) months
after the date upon which it was instituted; or (viii) any reorganization or
arrangement proceeding shall be instituted against any such Person for the
settlement, readjustment, composition or extension of any of its debts upon any
terms, and such proceeding is consented to or acquiesced in by any such Person
or is not dismissed within two (2) months after the date upon which it was
instituted; or (ix) any action or petition shall otherwise be brought against
any such Person seeking similar relief or alleging that it is Insolvent, unable
to pay its debts as they mature or generally not paying its debts as they become
due, and such action or petition is consented to or acquiesced in by any such
Person or is not dismissed within two (2) months after the date upon which it
was brought; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.7 <U>Reputational Decline</U>. Licensee or any of its Affiliates engage in
conduct that is generally viewed by the public as offensive or reprehensible
from a legal or moral perspective and such conduct results in a material
impairment or diminution of the good name, image or brand of TDSF or any of its
Affiliates or of the Disney Properties, the Licensed Materials or any other
names, brands, trademarks, logos, symbols, characters or other proprietary
designations or intellectual property of TDSF or any of its Affiliates, in each
case as determined by TDSF in its business judgment. In order to exercise the
right of termination under this Section&#160;13.7, TDSF shall provide written
notice to Licensee within two (2) months following the date on which TDSF knows
of such conduct. Any failure to provide such written notice within such two (2)
month period shall constitute a waiver of the right to terminate this Agreement
under this Section&#160;13.7 with respect to the respective conduct in that
particular instance only. In the event that Licensee disputes whether TDSF has a
right to terminate this Agreement under this Section&#160;13.7, Licensee shall,
within twenty (20) Business Days following written notice from TDSF, provide
TDSF with written notice of such dispute, whereupon the parties shall, within
five (5) Business Days following such written notice from Licensee, commence the
arbitration process specified under Section&#160;21.23 with respect thereto. In
connection therewith, within two (2) Business Days following the selection of
the Arbitrator for such dispute in the manner specified in Section&#160;21.23,
the parties shall jointly submit a written request to such Arbitrator requesting
that such dispute be resolved with extraordinary expedition in accordance with
Section&#160;21.23 and in any event within twenty (20) Business Days following
the date of such request. The sole dispute to be resolved in connection with any
proceeding submitted for resolution under Section&#160;21.23 in accordance with
the provisions of this Section&#160;13.7 shall be whether or not TDSF has the
right to terminate this Agreement pursuant to the terms of this
Section&#160;13.7. Notwithstanding anything contained herein to the contrary, in
the event that TDSF seeks to terminate this Agreement pursuant to this
Section&#160;13.7, such termination shall not become effective until twenty (20)
Business Days following the earliest to occur of (i) the failure of Licensee to
notify TDSF of a dispute hereunder within twenty (20) Business Days following
TDSF&#146;s notice of termination, (ii) Licensee&#146;s written acknowledgement
that TDSF is entitled to terminate this Agreement under this Section&#160;13.7,
and (iii) the Arbitrator&#146;s final written determination that TDSF is
entitled to terminate this Agreement pursuant to this Section&#160;13.7; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.8 <U>Material Breach or Termination of TCP Guaranty and Commitment</U>. TCP
or Licensee Parent shall breach or violate any material term, covenant or
condition that is binding upon TCP or Licensee Parent under the TCP Guaranty and
Commitment and shall fail to cure such breach within ten (10) Business Days
following written notice of such breach from TDSF, Licensee or any of their
respective Affiliates, or the TCP Guaranty and Commitment shall be terminated
for any reason; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.9 <U>Breach of Certain Representations, Warranties and Covenants</U>. Either
(i) Licensee shall breach or violate, in any respect, any of the representations
and warranties set forth in Section 18.1, 18.2 or subparagraph (i) or (ii) of
Section 18.3, which breach or violation is not Cured by Licensee and has or
might reasonably be expected to have a material adverse effect on
Licensee&#146;s ability to perform its obligations under this Agreement or the
transactions contemplated by this Agreement, (ii) Licensee shall breach or
violate, in any respect, the limitations set forth in Section 4.10.8 or (iii)
Licensee, Licensee Parent or Canadian Parent shall breach or violate, in any
respect, its obligations under the second sentence of Section 9.12.3.
Notwithstanding anything to the contrary contained herein, Licensee acknowledges
that Licensee, Licensee Parent and Canadian Parent shall have no right or
opportunity to Cure any of the breaches or violations of their respective
limitations and obligations described in subparagraph (ii) or (iii) of this
Section 13.9 and, under such circumstances, TDSF shall be entitled to terminate
this Agreement immediately upon three (3) Business Days&#146; written notice to
Licensee; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.10 <U>Uncured Material Breach of Certain Covenants</U>. Licensee shall commit
any Material Breach of its obligations under Section 5.2.8, 6.3, 9.1, 9.8,
9.10.3, 9.13, 9.15.1, 10 or 21.2 or under the first sentence of Section 9.12.3,
in each case that is not Cured by Licensee; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.11 <U>Defaults under Indebtedness</U>. Any of the Licensee Entities shall (i)
default in making any payment of any principal of any Indebtedness on the due
date with respect thereto, (ii) default in making any payment of any interest on
any Indebtedness beyond the period of grace, if any, provided in the instrument
or agreement under which such Indebtedness was created, or (iii) default in the
observance or performance of any other agreement or condition relating to any
Indebtedness 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, in the case of any of the
preceding subparagraphs (i), (ii) or (iii) of this Section 13.11, to cause, or
to permit the holder or beneficiary of such Indebtedness (or a trustee or agent
on behalf of such holder or beneficiary) to cause, such Indebtedness to become
due prior to its stated maturity or otherwise to become payable or any
collateral securing such Indebtedness (including, without limitation, any
inventory of any Licensee Entity) to be foreclosed upon or sold for purposes of
satisfying such Indebtedness; <U>provided</U>, that, with respect to
Indebtedness that is not in any manner secured by any of the properties, assets,
Contracts (including, without limitation, this Agreement) or Business of
Licensee or its Affiliates, a default, event or condition described in
subparagraph (i), (ii) or (iii) of this Section 13.11 shall not at any time
entitle TDSF to terminate this Agreement pursuant to this Section 13.11 unless,
at such time, one (1) or more defaults, events or conditions of the type
described in subparagraphs (i), (ii) and/or (iii) of this Section 13.11 shall
have occurred and be continuing with respect to such unsecured Indebtedness with
an aggregate outstanding principal amount of Five Hundred Thousand Dollars
($500,000) or more; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.12 <U>Judgments</U>. One (1) or more final, non-appealable judgments or
decrees shall be entered against any of the Licensee Entities or any of their
respective properties involving an aggregate liability (in excess of any
applicable insurance as to which the relevant insurance company has acknowledged
coverage) of Thirty-Five Million Dollars ($35,000,000) (the "<B>Judgment
Threshold</B>") or more, and such judgments or decrees shall not have been
vacated, discharged, stayed or bonded pending appeal within twenty (20) Business
Days following the entry thereof, <U>provided</U>, that, beginning effective
with the second (2<FONT SIZE=1>nd</FONT>) Contract Year and continuing through each and
every Contract Year of the Term thereafter, the Judgment Threshold for each
Contract Year shall be the Judgment Threshold for the immediately preceding
Contract Year, as adjusted to reflect the increase, if any, in the CPI in
accordance with the CPI Adjustment Methodology; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.13 <U>Uninsured Losses</U>. There shall occur any material loss, theft,
damage or destruction of any property or assets of any of the Licensee Entities,
which loss, theft, damage or destruction (i) until the end of the fourth
(4<FONT SIZE=1>th</FONT>) Contract Year, results in an aggregate loss (in excess of any
applicable insurance as to which the relevant insurance company has acknowledged
coverage) of Thirty-Five Million Dollars ($35,000,000) (the "<B>Loss
Threshold</B>") or more <I><U>or</U></I> could otherwise reasonably be expected
to materially and adversely affect Licensee&#146;s ability to operate the
Business, or (ii) following the end of the fourth (4<FONT SIZE=1>th</FONT>) Contract
Year, results in an aggregate loss (in excess of any applicable insurance as to
which the relevant insurance company has acknowledged coverage) equal to or
greater than the Loss Threshold <I><U>and</U></I> could reasonably be expected
to materially and adversely affect Licensee&#146;s ability to operate the
Business, <U>provided</U>, that, beginning effective with the second
(2<FONT SIZE=1>nd</FONT>) Contract Year and continuing through each and every Contract
Year of the Term thereafter, the Loss Threshold for each Contract Year shall be
the Loss Threshold for the immediately preceding Contract Year, as adjusted to
reflect the increase, if any, in the CPI in accordance with the CPI Adjustment
Methodology; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.14 <U>Breaches of Material Contracts</U>. Any of the Licensee Entities shall
be in breach of one (1) or more material Contracts by which any of such Licensee
Entities or any of their respective properties is bound and such breach or
breaches result in an aggregate liability (in excess of any applicable insurance
as to which the relevant insurance company has acknowledged coverage) of
Thirty-Five Million Dollars ($35,000,000) (the "<B>Breach Threshold</B>") or
more <I><U>and</U></I> could reasonably be expected to materially and adversely
affect Licensee&#146;s ability to operate the Business, <U>provided</U>, that,
beginning effective with the second (2<FONT SIZE=1>nd</FONT>) Contract Year and
continuing through each and every Contract Year of the Term thereafter, the
Breach Threshold for each Contract Year shall be the Breach Threshold for the
immediately preceding Contract Year, as adjusted to reflect the increase, if
any, in the CPI in accordance with the CPI Adjustment Methodology. For purposes
of this Section&#160;13.14, all Lease Agreements shall be deemed to be material
Contracts. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
13.15 <U>Other Termination Rights</U>. In addition, TDSF shall have the right to
terminate this Agreement in accordance with Sections 21.2 and 21.3 of this
Agreement. </FONT></P>

<P><FONT SIZE=3>14.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>TERMINATION BY LICENSEE</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Without prejudice to any other right or remedy available to Licensee at law or
in equity in respect of any event described below (but subject to the
limitations set forth in Section&#160;21.22), this Agreement may be terminated
by Licensee by written notice to TDSF upon the occurrence of one (1) or more of
the following events: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
14.1 <U>Material Breach</U>. During any rolling twenty-four (24) Retail Month
period during the Term, either (i) TDSF shall commit five (5) or more Material
Breaches that are not Cured by TDSF or (ii) TDSF shall commit seven (7) or more
Material Breaches, whether Cured or Uncured by TDSF, in each case other than any
breaches described in Section 14.4; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
14.2 <U>Withdrawn or Retired Character Properties</U>. At any time during the
Term, TDSF shall have sold or, on a permanent basis (<U>i.e.</U>, for a period
of three (3) years or more), withdrawn, retired from usage or lost the usage of,
in connection with Disney Merchandise hereunder, one (1) or more Character
Properties that were featured or incorporated in Disney Merchandise that, during
any one (1) of the three (3) most recently completed twelve (12) Retail Month
periods prior to the date of such sale or permanent withdrawal, retirement or
loss of use, accounted for fifty-one percent (51%) or more of Licensee&#146;s
Net Retail Sales; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
14.3 <U>Loss of Use of "Disney" Name</U>. Following the Effective Date, TDSF and
its Affiliates shall become permanently and irrevocably prohibited from using
the "Disney" name in a manner that prevents Licensee from operating the
Business, the Facilities and the Internet Store under the "Disney Store" name
and from performing its other material obligations under this Agreement; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
14.4 <U>Uncured Material Breach of Certain Covenants</U>. TDSF shall commit two
(2) or more Material Breaches of its obligations under (i) Section 6.2.2 or (ii)
subparagraph (A) of Section 6.1, in each case that is not Cured by TDSF.
</FONT></P>

<P><FONT SIZE=3>15.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>PURCHASE OF FACILITIES UPON TERMINATION</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.1 <U>Right to Purchase or Cause Purchase of Facilities; Notice Dates;
Commencement of Purchase Process</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.1.1 <U>Right to Purchase</U>. Upon the expiration or earlier termination of
this Agreement, TDSF or any of its Affiliates shall have the right to purchase,
or cause a third party (the "<B>Third Party Purchaser</B>") to purchase, one (1)
or more of the Facilities (the Facilities designated in writing by TDSF to be
purchased, the "<B>Designated Facilities</B>") through the process set forth in
this Section&#160;15 (the "<B>Purchase Process</B>"). For purposes hereof, each
Designated Facility shall be deemed to include (i) all tenant improvements,
furniture, fixtures and equipment, carpeting and flooring, shelving, appliances,
lighting, d&#233;cor, signage, displays, cut-outs, window strips, multimedia,
check-out counters, registers and systems, information technology and systems,
and other physical attributes located within or directly surrounding such
Designated Facility; (ii) all inventories of Disney Merchandise located therein
or allocated thereto; (iii) the employees at such Designated Facility; (iv) the
Lease Agreement associated therewith; and (v) any other incidental assets or
operations located directly in such Designated Facility. No Designated Facility
shall be deemed to include (a)&#160;the corporate headquarters or other
corporate offices or corporate employees of Licensee; (b)&#160;any Distribution
Centers or distribution operations of Licensee; (c) any other Business
Properties of Licensee that are not Facilities; (d) the Internet Store, which
shall be deemed to include all webpages and user interfaces of the Internet
Store, all software and programming code for the Internet Store, including from
the check-out process through the distribution center fulfillment and
replenishment process, and all inventory set aside specifically for the Internet
Store in the ordinary course of business; (e) any inventory located outside of
any Designated Facility; (f)&#160;any Non-Disney Technology and Elements owned
by Licensee in accordance with the terms hereof; or (g) any other assets or
operations of Licensee not included directly within a Designated Facility (such
assets and operations described in the preceding subparagraphs (a) through (g)
being referred to herein collectively as the "<B>Overhead Assets and
Operations</B>"); <U>provided</U>, that, at TDSF&#146;s election in its sole
discretion, it shall be entitled to include all or any portion of the Overhead
Assets and Operations in the Purchase Process by so designating all or such
portion of the Overhead Assets and Operations in its Election Notice, in which
event such Overhead Assets and Operations so designated by TDSF shall be treated
for purposes of this Section&#160;15 as one (1) "Designated Facility" to be
purchased by TDSF, its Affiliates or a Third Party Purchaser, as the case may
be, with the parties making such commercially reasonable adjustments to the
Purchase Process set forth herein as may be necessary to accommodate such assets
and operations in such process. During the Purchase Process, TDSF may elect, in
its sole discretion, to add Facilities or Overhead Assets and Operations to, or
to delete Facilities or Overhead Assets and Operations from, the Designated
Facilities, for the benefit of itself, its Affiliates or any Third Party
Purchaser. For purposes of clarification, the parties acknowledge and agree that
none of the Disney Properties, the Licensed Materials or any other name, brand,
trademark, logo, symbol, character or other proprietary designation or
intellectual property of TDSF or its Affiliates will be offered for sale or sold
through the Purchase Process. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.1.2 <U>No Obligation to Purchase</U>. Notwithstanding anything contained in
this Agreement to the contrary, and notwithstanding whether TDSF shall have
exercised its right to commence the Purchase Process hereunder, neither TDSF nor
any of its Affiliates shall be obligated to purchase, or cause a Third Party
Purchaser to purchase, any of the Facilities or any Overhead Assets and
Operations, and TDSF (or any of its Affiliates) or any Third Party Purchaser may
withdraw from the Purchase Process at any time prior to the consummation
thereof, without recourse or remedy by Licensee and without any abatement or
reduction of any payments or other obligations hereunder. In the event that none
of the Facilities or Overhead Assets and Operations is purchased by TDSF (or any
of its Affiliates) or any Third Party Purchaser in accordance with the Purchase
Process, all of the Facilities and the Overhead Assets and Operations shall
continue to be held or owned solely by Licensee; <U>provided</U>, that, in such
event, all of Licensee&#146;s rights and licenses to use the Licensed Materials
and/or any other proprietary designations or intellectual property owned by or
licensed to TDSF or any of its Affiliates shall terminate as provided in
Section&#160;16. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.1.3 <U>Notice of Exercise of Right</U>. Either (i) no earlier than the date
that is four (4) years, and no later than the date that is two (2) years and six
(6) months, prior to the expiration date of the Term (as the Term may be
extended from time to time pursuant to Section&#160;2.2), unless by such date
each of the parties shall have executed a definitive written agreement regarding
renewal or extension of this Agreement pursuant to the negotiations under
Section&#160;2.2.2, or (ii)&#160;if this Agreement is terminated prior to the
end of the Term by either party, then no later than the date that is three (3)
months following the date of such termination, TDSF shall, if it so elects,
provide written notice (the "<B>Election Notice</B>") to Licensee that TDSF (or
any of its Affiliates) is exercising its right to purchase, or cause a Third
Party Purchaser to purchase, one (1) or more Designated Facilities in accordance
with the terms of this Section&#160;15, which Election Notice shall identify
such Designated Facilities (subject to TDSF&#146;s right to add thereto or
delete therefrom pursuant to Section&#160;15.1.1). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.1.4 <U>Commencement of Purchase Process</U>. In the event that TDSF provides
the Election Notice to Licensee in accordance with Section 15.1.3, the Purchase
Process shall commence (i) on the date that is two (2) years prior to the
expiration date of the Term (as the Term may be extended from time to time
pursuant to Section 2.2) or (ii) if this Agreement is terminated prior to the
end of the Term by either party hereto, then no later than the date that is six
(6) months following the date of such termination (the date of such commencement
of the Purchase Process, the "<B>Purchase Commencement Date</B>"). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.2 <U>Appraisal and Bidding Process; Determination of Compensation</U>.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.2.1 <U>Appraisal of Business</U>. In the event that TDSF (or any of its
Affiliates) elects to exercise its right to purchase, or cause a Third Party
Purchaser to purchase, the Designated Facilities in accordance with the terms of
this Section 15, then TDSF and Licensee shall cause the Designated Facilities to
be appraised in accordance with the following procedures: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Within ten (10) Business Days following the Purchase Commencement Date, each
of Licensee and TDSF shall in writing provide the other party with the names of
two (2) independent third party appraisers who are acceptable to Licensee or
TDSF, respectively, and who are recognized as having the capability to appraise
specialty retailers and who have had significant experience in performing such
appraisals. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) Within five (5) Business Days following each party's provision of the names
of such two (2) appraisers to the other party, each of Licensee and TDSF shall
notify the other party in writing regarding whether one or both of such proposed
appraisers are acceptable to Licensee or TDSF, respectively (<U>provided</U>, that each
of Licensee and TDSF shall be required to deem acceptable at least one of the
appraisers proposed by the other party), and, within five (5) Business Days
following such notice, each of Licensee and TDSF shall select and engage one (1)
appraiser that was acceptable to the other party to conduct an appraisal of the
Designated Facilities hereunder (each such appraiser, an <B>"Appraiser,"</B>
and, collectively, the <B>"Appraisers"</B>). Each Appraiser shall be required to
(i) execute a confidentiality and non-disclosure agreement to be prepared by
TDSF in a form reasonably satisfactory to TDSF and Licensee, and (ii) complete
its appraisal of the Designated Facilities on or before the date that is three
(3) months following the Purchase Commencement Date. Each party hereto shall
bear all costs and expenses associated with the appraisal conducted by the
Appraiser selected by such party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) TDSF shall provide each Appraiser with a copy of this Agreement. Each party
hereto shall cause its Appraiser to appraise the Designated Facilities in
accordance with standard valuation methodology commonly used by purchasers of
specialty retail businesses (of a size and type comparable to the Designated
Facilities) to determine the enterprise value of the Designated Facilities. The
appraisal of the Designated Facilities shall also be conducted in accordance
with the following assumptions and principles: (i) each Appraiser shall assume
that all of the Designated Facilities that exist as of the date of such
appraisal are being purchased; (ii) the terms and conditions of this Agreement,
including, without limitation, all financial terms and conditions, the Licensee
Payments, Licensee's right to use the Licensed Materials in accordance with the
terms hereof, and all other material elements of the transactions contemplated
hereby, will continue for the Designated Facilities for a period of fifteen (15)
years (if the Purchase Process commences during the Initial Term) and ten (10)
years (if the Purchase Process commences during any Renewal Term) (or, in the
event that the right to purchase the Designated Facilities pursuant to the
Purchase Process was triggered by an early termination of this Agreement by TDSF
in accordance with the terms of Section 13 of this Agreement or by any
proceeding under the Federal Bankruptcy Code or any other applicable bankruptcy
Law, five (5) years), with no value assigned to any period thereafter; (iii) the
Business will continue to operate on an ongoing basis in accordance with past
practice for the 15-year, 10-year or 5-year period covered by the valuation in
accordance with the preceding subparagraph (ii), including, without limitation,
fully reflecting all requirements pertaining to maintenance of and capital
improvements to the Designated Facilities and the liquidity and capital needs
associated therewith; (iv) the enterprise valuation shall include an appropriate
adjustment for corporate overhead expenses that would be required to be incurred
and shared among all of the Designated Facilities as part of the operation of
the chain, if such expenses are not already fully reflected by the inclusion of
any Overhead Assets and Operations designated by TDSF to be included in the
Purchase Process; and (v) no value will be assigned to tangible or intangible
benefits that may accrue to any purchaser of the Designated Facilities as a
result of its relationship with TDSF or any of its Affiliates (<U>e.g.</U>,
perceived marketplace validation or confirmation) or other potential business
relationships with TDSF or any of its Affiliates that may accrue to a purchaser
of the Designated Facilities other than those directly in connection with the
Designated Facilities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d) The parties shall cooperate in good faith with each Appraiser and use
commercially reasonable efforts to assist in the appraisals of the Designated
Facilities, including, without limitation, providing the Appraisers with
reasonable access, upon reasonable notice and during normal business hours, to
the relevant personnel, facilities, books, records, documentation and other
materials necessary to conduct the appraisals of the Designated Facilities,
promptly and accurately responding to any questions or inquiries from the
Appraisers and commencing the gathering of relevant books, records,
documentation and other materials necessary for the appraisals promptly
following the Purchase Commencement Date so as to enable the appraisals to be
completed as soon as reasonably practicable. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(e) No later than three (3) months following the Purchase Commencement Date,
each Appraiser shall be required to provide each of TDSF, Licensee and the other
Appraiser with (i) its written estimate of the fair market value of the
Designated Facilities taken as a whole and consisting of one unified enterprise
(an <B>"FMV Appraisal"</B>) and (ii) a schedule that sets forth the Facility
Appraisal Value for each of the Designated Facilities. For purposes of this
Agreement, the <B>"Facility Appraisal Value"</B> of a Facility shall be equal to
(a) the applicable Appraiser's FMV Appraisal (less the value, if any, such
Appraiser assigns to any Overhead Assets and Operations included in the Purchase
Process at TDSF's request, which amount shall be separately identified by such
Appraiser) <U>multiplied by</U> (b) a fraction, the numerator of which is the Net
Retail Sales generated by such Designated Facility during the Contract Year most
recently completed prior to the Purchase Commencement Date and the denominator
of which is the Net Retail Sales generated by all of the Designated Facilities
during the Contract Year most recently completed prior to the Purchase
Commencement Date. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.2.2 <U>Bidding Process</U>. In addition to the appraisals contemplated by
Section 15.2.1, TDSF may solicit bids for the purchase of the Designated
Facilities from prospective Third Party Purchasers (including any Third Party
Purchasers suggested or proposed by Licensee) in accordance with the following:
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) TDSF shall, in its sole discretion, select the prospective Third Party
Purchasers from which it will solicit bids for the Designated Facilities.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) TDSF shall provide each prospective Third Party Purchaser that has executed
a confidentiality and non-disclosure agreement (which shall be prepared by TDSF
in a form reasonably satisfactory to TDSF and Licensee) with such information
regarding the Designated Facilities as it deems necessary or desirable in its
business judgment in order to enable each such prospective Third Party Purchaser
to submit a good faith bid for the Designated Facilities, <U>provided</U>, that
such information shall include the same instructions provided to the Appraiser
pursuant to subparagraphs (i) through (v) of Section 15.2.1(c) (and both
Licensee and TDSF agree that each such prospective Third Party Purchaser may be
provided with a copy of this Agreement by TDSF). Neither TDSF nor Licensee shall
disclose the FMV Appraisals or the Facility Appraisal Values to any prospective
Third Party Purchaser. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) Both TDSF and Licensee shall cooperate in good faith with each other and
with each prospective Third Party Purchaser in connection with the potential
purchase of the Designated Facilities. Throughout the Term and the Purchase
Process, Licensee shall manage and operate the Business in good faith in a
manner designed to preserve and maintain the integrity of the Purchase Process
and the value of the Designated Facilities and the remainder of the Business.
Without limiting the foregoing, in order to facilitate the purchase of the
Designated Facilities by a Third Party Purchaser, Licensee shall at all times
during the Term and the Purchase Process (i) preserve and maintain its ability,
at the time of a Transfer of any Designated Facilities under this Section 15, to
Transfer such Designated Facilities in the manner required hereunder, free and
clear of any and all Encumbrances, other than and subject to the Lease
Agreements applicable thereto; (ii) provide each prospective Third Party
Purchaser with reasonable access, upon reasonable notice and during normal
business hours, to the relevant personnel, facilities, books, records,
documentation and other materials necessary to conduct due diligence with
respect to the Designated Facilities and the remainder of the Business and
perform a thorough valuation of the Designated Facilities and the remainder of
the Business; (iii) promptly and accurately respond to any questions or
inquiries from each prospective Third Party Purchaser; (iv) refrain from taking
any actions or making any statements that would jeopardize the sale or Transfer
of the Designated Facilities pursuant to the Purchase Process; and (v) take such
additional steps and perform such additional actions as TDSF or any prospective
Third Party Purchaser may reasonably request in connection with the purchase of
the Designated Facilities. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d) Each prospective Third Party Purchaser that desires to submit an offer for
the Designated Facilities shall submit such offer (each, a <B>"Third Party
Offer"</B>) in writing, which offer must contain, among other things, (i) a list
of the Facilities and/or Overhead Assets and Operations that such prospective
Third Party Purchaser desires to purchase and (ii) the price that such
prospective Third Party Purchaser is willing to pay for such Facilities and/or
Overhead Assets and Operations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(e) Following its receipt of any Third Party Offers from prospective Third Party
Purchasers, TDSF shall have the right, in its sole discretion, to negotiate
among the prospective Third Party Purchasers, solicit additional offers from
either the original prospective Third Party Purchasers or, if TDSF has received
fewer than three (3) Third Party Offers from prospective Third Party Purchasers,
from one (1) additional round of prospective Third Party Purchasers, and
otherwise administer the Purchase Process among the prospective Third Party
Purchasers in any manner it deems necessary or desirable, provided, that TDSF
shall at all times comply with the terms of this Section 15. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(f) At the conclusion of the foregoing bidding process, TDSF shall have the
right either (i) to purchase the Designated Facilities itself (or through any of
its Affiliates) or (ii) to select, in its sole discretion, the Third Party Offer
of one of the prospective Third Party Purchasers. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.2.3 <U>Compensation for Designated Facilities</U>. If TDSF elects to proceed
with a purchase of the Designated Facilities from Licensee either by itself (or
any of its Affiliates) or through a Third Party Purchaser, then the compensation
to the parties hereto in connection with such purchase shall be calculated as
follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) For purposes of this Agreement, (i) the <B>"Licensee Compensation
Amount"</B> shall be equal to the sum of the two (2) FMV Appraisals from the
Appraisers <U>divided by</U> two (2); and (ii) in the case of a purchase of the
Designated Facilities by a Third Party Purchaser, the <B>"Remainder Amount"</B>
shall be equal to the absolute value of the difference between the Licensee
Compensation Amount and the final purchase price actually paid by such Third
Party Purchaser. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) In the case of a purchase of the Designated Facilities by TDSF or any of its
Affiliates, TDSF shall pay an amount equal to the Licensee Compensation Amount
to Licensee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) In the case of a purchase of the Designated Facilities by a Third Party
Purchaser, </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) if the final purchase price actually paid by such Third Party Purchaser is
equal to the Licensee Compensation Amount, then such Third Party Purchaser shall
pay an amount equal to the Licensee Compensation Amount to Licensee; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) if the final purchase price actually paid by such Third Party Purchaser is
greater than the Licensee Compensation Amount, then such Third Party Purchaser
shall pay an amount equal to the Licensee Compensation Amount to Licensee and
either (a) in the event that the right to purchase the Designated Facilities
pursuant to the Purchase Process was triggered by an early termination of this
Agreement by TDSF in accordance with the terms of Section 13 of this Agreement
or by any proceeding under the Federal Bankruptcy Code or any other applicable
bankruptcy Law, an amount equal to the Remainder Amount to TDSF, (b) in the
event that the right to purchase the Designated Facilities pursuant to the
Purchase Process was triggered by an early termination of this Agreement by
Licensee in accordance with the terms of this Agreement (including, without
limitation, Section 14), an amount equal to the Remainder Amount to Licensee, or
(c) in the event that the right to purchase the Designated Facilities pursuant
to the Purchase Process was triggered by an early termination of this Agreement
by the mutual agreement of TDSF and Licensee or by the expiration of this
Agreement in accordance with its terms, an amount equal to one-half of the
Remainder Amount to each of TDSF and Licensee; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) if the final purchase price actually paid by such Third Party Purchaser is
less than the Licensee Compensation Amount, then (I) such Third Party Purchaser
shall pay an amount equal to such final purchase price to Licensee and (II) TDSF
shall pay an amount equal to the Remainder Amount to Licensee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d) At the time of the closing of the purchase of the Designated Facilities, the
Licensee Compensation Amount, the Remainder Amount and the amount of the final
purchase price actually paid by the Third Party Purchaser (as applicable) shall
be, and shall be deemed to be, (i) reduced by the average of the two Facility
Appraisal Values for each Designated Facility that ultimately is not Transferred
to TDSF, its Affiliates or a Third Party Purchaser, as the case may be, due to
closure of the Designated Facility, refusal of the Landlord thereof to consent
to such Transfer, a casualty loss to such Designated Facility, the election of
TDSF, its Affiliates or such Third Party Purchaser not to include such
Designated Facility in the Purchase Process for any reason, or such other
factors as may arise prior to the closing of the transaction that may preclude
the inclusion of one (1) or more Designated Facilities in the final sale, and/or
(ii) increased by the value of any Designated Facility that was added to the
Purchase Process but was not included in the original FMV Appraisals, which
value shall be calculated as (x) the Net Retail Sales generated by such
Designated Facility during the Contract Year most recently completed prior to
the Purchase Commencement Date, <U>multiplied by</U> (y) the quotient obtained
when (I) the average of the two FMV Appraisals for all of the original
Designated Facilities (exclusive of the value of any Overhead Assets and
Operations) is <U>divided by</U> (II) the sum of the Net Retail Sales generated
by all of the original Designated Facilities during the Contract Year most
recently completed prior to the Purchase Commencement Date. In addition, the
parties hereto shall, and shall cause the Appraisers and, if applicable, the
Third Party Purchaser to, make such other appropriate, good faith adjustments in
the FMV Appraisals, the Facility Appraisal Values, the Third Party Offers, the
Licensee Compensation Amount and, if applicable, the Remainder Amount to reflect
any other changes in the Designated Facilities or other pertinent portions of
the Business that occur prior to the closing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.3 <U>Purchase Mechanics</U>. In connection with the purchase of the
Designated Facilities by TDSF or any of its Affiliates or a Third Party
Purchaser pursuant to this Section&#160;15, Licensee shall, at its sole cost and
expense and as expeditiously as practicable, negotiate in good faith and execute
and deliver all necessary agreements, instruments and other documentation
customary for a transaction of this kind (which may require Licensee to agree to
certain representations, warranties, indemnities, break-up fees, transition
services and other terms and conditions customary for a transaction of this
kind), all of which shall be in a form reasonably acceptable to TDSF and
Licensee, and Licensee shall expeditiously take all such additional actions as
may be reasonably required in order to consummate the purchase of the Designated
Facilities as contemplated hereby. Licensee shall not take any action designed
to hinder, delay or render impracticable the purchase of the Designated
Facilities in accordance with the terms of this Section&#160;15. In the event
that, notwithstanding the exercise of its best efforts, Licensee is unable to
reach final agreement with TDSF (or any of its Affiliates) or a Third Party
Purchaser selected by TDSF, then TDSF may select another Third Party Purchaser
pursuant to Section&#160;15.2.2 to purchase the Designated Facilities, and
Licensee shall, at its sole cost and expense, repeat the foregoing process with
such alternative Third Party Purchaser. The consummation of any purchase of the
Designated Facilities under this Section&#160;15 shall occur concurrently with,
or as soon as reasonably practicable following, the expiration of the Term, or,
in the case of the earlier termination of this Agreement, Licensee shall use its
best efforts to cause the consummation of such purchase as soon as reasonably
practicable following the Purchase Commencement Date. Following the consummation
of any purchase of the Designated Facilities under this Section&#160;15,
Licensee shall provide the purchaser with such support services as may be
reasonably required in connection with such purchase, and such purchaser shall
bear all actual, reasonable, out-of-pocket costs and expenses relating to such
services (including, without limitation, the actual, reasonable out-of-pocket
costs and expenses incurred by Licensee relating to such services). Under
appropriate circumstances, Licensee may require such purchaser to enter into an
interim service agreement with Licensee in connection with such purchase,
<U>provided</U>, that the terms of any such agreement (including any financial terms)
shall be reasonable and customary for a transaction of the sort contemplated
thereby. </FONT></P>

<P><FONT SIZE=3>16.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>EFFECT OF EXPIRATION OR TERMINATION OF THIS AGREEMENT</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
16.1 <U>Expiration</U>. In the event of the expiration of this Agreement in
accordance with its terms, either (i) upon such expiration, if the Purchase
Process contemplated by Section 15 was never commenced or was commenced and
completed with respect to all of the Facilities concurrently with such
expiration, (ii) within three (3) months following such expiration, if the
Purchase Process contemplated by Section&#160;15 was commenced and either
abandoned prior to such expiration or completed with respect to less than all of
the Facilities concurrently with such expiration, or (iii) if the Purchase
Process contemplated by Section&#160;15 was commenced but has not been completed
or abandoned concurrently with or prior to such expiration, (a) if the Purchase
Process is subsequently completed with respect to all of the Facilities, upon
the date as of which the Purchase Process is completed, or (b) if the Purchase
Process is subsequently abandoned or completed with respect to less than all of
the Facilities, within three (3) months following the date of such abandonment
or partial completion, Licensee shall, at its sole cost and expense, cease any
and all uses of the Licensed Materials, whether in connection with the Disney
Merchandise, the FF&amp;E Materials, the Marketing Materials or otherwise, and
shall no longer be entitled to use the same in connection with the Facilities,
the Internet Store or the Business, except (x) for such materials already in
existence and previously distributed to the public, and (y) to the extent that
Licensee may have rights to use any Licensed Materials pursuant to any separate
agreements with TDSF or any of its Affiliates apart from this Agreement. During
any period following the expiration of this Agreement that Licensee may continue
to operate the Business and use the Licensed Materials in accordance with the
preceding sentence, Licensee shall continue to have the rights hereunder with
respect to the use of the Licensed Materials provided in, and shall continue to
operate the Business in accordance with, and each of the parties hereto shall
continue to be bound by the terms and conditions of, Sections&#160;1 (as
applicable), 3 (other than Section 3.2), 4 (other than Section&#160;4.11), 5, 7,
9 (other than Sections 9.9.3 and 9.9.8), 10, 11, 12, 15, 16, 17, 18, 19 and 21.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
16.2 <U>Early Termination</U>. In the event of the early termination of this
Agreement by either party hereto, Licensee shall continue to have the rights
hereunder with respect to the use of the Licensed Materials provided in, and
shall continue to operate the Business in accordance with, and each of the
parties shall continue to be bound by the terms and conditions of, Sections 1
(as applicable), 3 (other than Section 3.2), 4 (other than Section 4.11), 5, 7,
9 (other than Sections 9.9.3 and 9.9.8), 10, 11, 12, 15, 16, 17, 18, 19 and 21
until (i) if TDSF or any of its Affiliates elects (within the time period
specified by Section 15.1.3) to purchase or cause a Third Party Purchaser to
purchase all of the Facilities pursuant to Section 15, the date as of which the
Purchase Process is completed, (ii) if TDSF or any of its Affiliates elects
(within the time period specified by Section 15.1.3) to purchase or cause a
Third Party Purchaser to purchase any Designated Facilities pursuant to Section
15 and such Purchase Process is completed but for less than all of the
Facilities, or if such Purchase Process is commenced but subsequently abandoned,
then the date that is twelve (12) months following such partial completion or
such abandonment, or (iii) if TDSF and its Affiliates do not elect (within the
time period specified by Section 15.1.3) to purchase or cause a Third Party
Purchaser to purchase any Designated Facilities pursuant to Section 15, the date
that is twelve (12) months following the date of such termination of this
Agreement. Following such time period described in the preceding sentence,
Licensee shall, at its sole cost and expense, cease any and all uses of the
Licensed Materials, whether in connection with the Disney Merchandise, the
FF&amp;E Materials, the Marketing Materials or otherwise, and shall no longer be
entitled to use the same in connection with the Facilities, the Internet Store
or the Business, except (a) for such materials already in existence and
previously distributed to the public, and (b) to the extent that Licensee may
have rights to use any Licensed Materials pursuant to any separate agreements
with TDSF or any of its Affiliates apart from this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
16.3 <U>Survival of Certain Provisions</U>. Notwithstanding anything to the
contrary contained herein, such rights and obligations of the parties under this
Agreement that by their nature are intended to survive the expiration or earlier
termination of this Agreement, including, without limitation, Sections 1 (as
applicable), 10.2.2, 10.2.3, 11, 12, 16, 17, 18, 19 and 21 (except Sections
21.18 and 21.24), shall survive such expiration or termination of this Agreement
either indefinitely or for such shorter period of time as may be set forth in
any such section. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
16.4 <U>Certain Rights of Licensee Regarding Inventory Liquidation Upon
Expiration or Termination</U>. If (a) the Term of this Agreement has been
terminated or has expired and has not been renewed pursuant to Section 2.2 and
no renewal or negotiation rights continue to exist thereunder, and (b) the
Purchase Process contemplated by Section 15 was commenced but abandoned or
terminated, or was commenced but was completed with respect to less than all of
the Facilities, or was not commenced prior to the expiration of the period
during which the Purchase Process could have been commenced pursuant to Section
15 and no Purchase Process can thereafter be commenced under Section 15 at any
time in the future in accordance with the terms of Section 15, then, for a
period not to exceed three (3) Retail Months prior to the expiration of the
Initial Term or any Renewal Term (including for this purpose any additional time
periods during which Licensee may continue to operate all or any portion of the
Business beyond the expiration or termination of this Agreement pursuant to
Section 16) (such 3-Retail-Month period, the "<B>Liquidation Period</B>"),
Licensee shall have the right to liquidate Disney Merchandise in the Facilities
and the Internet Store in accordance with the following: (i) Licensee shall be
entitled, at its election, to retain a nationally recognized firm that
specializes in inventory liquidation in order to assist Licensee in the
liquidation of Disney Merchandise, provided that such firm shall be subject to
the written approval of TDSF in its business judgment, (ii) Licensee shall be
entitled to provide for a gradual increase in discounts off of the intended
retail price of Disney Merchandise during the Liquidation Period in a manner
determined by Licensee in its reasonable discretion, (iii) Licensee shall be
entitled to consolidate inventories of Disney Merchandise among the Facilities
as each Facility is closed, and (iv) Licensee shall be entitled to promote the
liquidation and sale of Disney Merchandise at such discount prices solely within
the Facilities and the Internet Store through signage indicating that a sale is
in progress, provided that (x) all such signage shall be subject to TDSF&#146;s
written approval in its business judgment, (y) in no event shall Licensee use on
such signage any Disney Properties other than the name "Disney Store" in a form,
style, manner and size approved by TDSF in its sole discretion, and (z) in no
event shall Licensee use any phrases such as "Going Out of Business," "Mass
Closing," "Liquidation Sale," "Chain-Wide Sale," "Company-Wide Sale" or any
comparable phrases (but Licensee shall be entitled to use the phrase "Store
Closing" or comparable phrases). Notwithstanding the foregoing, for purposes of
clarification, (1) in no event shall there be any marketing, advertising or
promotion of any liquidation sale conducted by Licensee under this Section 16.4
anywhere outside of the Facilities or the Internet Store, including, without
limitation, no marketing, advertising or promotion by or through any traditional
media, direct mail, billboards or any other form of media or advertisement, (2)
all Disney Merchandise sold during the Liquidation Period must be sold only at
and through the Facilities and the Internet Store and through no other locations
or distribution channels, and (3) except as specifically provided in the
preceding subparagraphs (i) through (iv) of this Section 16.4, at all times
during the Liquidation Period, Licensee shall continue to comply with all other
requirements of this Agreement, including, without limitation, TDSF&#146;s sole
approval rights contained in Sections 4 and 5 hereof with respect to use of the
Disney Properties and the Licensed Materials. Following the Liquidation Period,
if Licensee has any remaining inventory of Disney Merchandise, Licensee shall,
as soon as reasonably practicable, destroy any and all such Disney Merchandise
and furnish to TDSF a certificate from Licensee&#146;s Chief Financial Officer
(or a senior executive financial officer with knowledge of or responsibility for
such matters) certifying as to such destruction. The Liquidation Period and any
rights granted to Licensee pursuant to this Section 16.4 shall automatically
terminate upon the occurrence of any breach by Licensee of any of the provisions
of this Section 16.4. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
16.5 <U>Certain Rights of Secured Lender Regarding Inventory Liquidation Upon
Event of Default</U>. In connection with any Debt Facility of Licensee and/or
its Subsidiaries that was entered into in accordance with Section 9.17.2 and
that is secured by (among other things) inventories of Disney Merchandise, if an
event of default (as defined in such Debt Facility) has occurred and is
continuing after all applicable grace and cure rights and periods provided under
such Debt Facility have been exhausted or have expired without an election by
Licensee or its Subsidiaries or TDSF or its Affiliates to exercise any of its
cure or comparable rights thereunder, then, for a period not to exceed three (3)
Retail Months (the "<B>Lender Liquidation Period</B>"), the Secured Lender under
such Debt Facility shall have the right (by itself or through a nationally
recognized liquidation firm as provided in subparagraph (i) below) to liquidate
Disney Merchandise subject to such Debt Facility in the Facilities and the
Internet Store in accordance with the following: (i) the Secured Lender shall be
entitled, at its election, to retain a nationally recognized firm that
specializes in inventory liquidation in order to assist the Secured Lender in
the liquidation of Disney Merchandise, provided that such firm shall be subject
to the written approval of TDSF in its reasonable business judgment, and, to the
extent the Secured Lender exercises such right under this subparagraph (i), any
action that may be taken by the Secured Lender under this Section 16.5 may be
undertaken or performed by such nationally recognized liquidation firm, (ii) the
Secured Lender shall be entitled to provide for discounts off of the retail
price of Disney Merchandise during the Lender Liquidation Period in a reasonable
form and manner as determined by the Secured Lender, (iii) the Secured Lender
shall be entitled to consolidate inventories of Disney Merchandise among the
Facilities as each Facility is closed and to conduct the closure of Facilities
in a manner that is reasonably satisfactory to each of the Secured Lender and
TDSF, (iv) the Secured Lender shall be entitled to promote the liquidation and
sale of Disney Merchandise at such discount prices solely within the Facilities
and the Internet Store through signage indicating that a sale is in progress,
provided that (x) all such signage shall be subject to TDSF&#146;s written
approval in its business judgment, (y) in no event shall the Secured Lender use
on such signage any Disney Properties other than the name "Disney Store" in a
form, style, manner and size approved by TDSF in its sole discretion, and (z) in
no event shall the Secured Lender use any phrases such as "Going Out of
Business," "Mass Closing," "Liquidation Sale," "Chain-Wide Sale," "Company-Wide
Sale" or any comparable phrases (but the Secured Lender shall be entitled to use
the phrase "Store Closing" or comparable phrases), and (v) the Secured Lender
(or its nationally recognized liquidation firm) shall be entitled to operate the
Facilities hereunder for the sole purpose of conducting the liquidation of
Disney Merchandise contemplated by the preceding subparagraphs (i) through (iv).
Notwithstanding the foregoing, for purposes of clarification, (1) in no event
shall there be any marketing, advertising or promotion of any liquidation sale
conducted by the Secured Lender (or its nationally recognized liquidation firm)
under this Section 16.5 anywhere outside of the Facilities or the Internet
Store, including, without limitation, no marketing, advertising or promotion by
or through any traditional media, direct mail, billboards or any other form of
media or advertisement, (2) all Disney Merchandise sold during the Lender
Liquidation Period must be sold only at and through the Facilities and the
Internet Store and through no other locations or distribution channels, (3)
except as specifically provided in the preceding subparagraphs (i) through (v)
of this Section 16.5, at all times during the Lender Liquidation Period, the
Secured Lender shall comply with the requirements of this Agreement that pertain
to the sale of Disney Merchandise and the operation of the Facilities for the
sole purpose of selling such Disney Merchandise, but the Secured Lender shall
not otherwise be deemed to be the "Licensee" for purposes hereof or otherwise
enjoy the rights and privileges of the Licensee hereunder, including, without
limitation, Licensee&#146;s rights with respect to the creation, development and
manufacture of Disney Merchandise, and (4) throughout the Lender Liquidation
Period, the Secured Lender shall maintain customary and reasonable policies of
insurance to protect against the risks associated with the exercise of its
rights hereunder (and each of TDSF and Licensee shall be named as an additional
insured under such policies). Following the Lender Liquidation Period, the
Secured Lender shall have no further rights to sell any remaining inventory of
Disney Merchandise. The Lender Liquidation Period and any rights granted to the
Secured Lender pursuant to this Section 16.5 shall automatically terminate upon
the occurrence of any breach by the Secured Lender of any of the provisions of
this Section 16.5. </FONT></P>

<P><FONT SIZE=3>17.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>PUBLIC DISCLOSURE; CONFIDENTIALITY</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
17.1 <U>Public Disclosure</U>. Except as required by any applicable Law or any
regulation of any securities exchange, securities trading system or similar
regulatory body, neither party will make or permit its Affiliates to make any
public disclosure or issue any press release or other form of announcement with
respect to this Agreement, any of the terms and conditions contained herein, or
the negotiations and discussions between the parties without the prior written
consent of the other party. Notwithstanding the foregoing, the parties hereto
acknowledge that, from time to time during the Term, either party may make
certain customary disclosures to the investment community, <U>provided</U>, that
unless approved by the other party in its sole discretion, such disclosures are
limited to the topic of such party&#146;s business objectives for, and the
business implications and general structure of, the relationship established by
this Agreement, and <U>provided</U> <U>further</U>, that (i)&#160;neither party
shall disclose any Confidential Information of the other party; and (ii)&#160;to
the extent practical, the party making such disclosure by way of a prepared
statement or other form of written disclosure to the investment community shall,
prior to such disclosure, furnish a copy of all portions addressing such topics
to the other party and consult with and consider suggestions from the other
party with respect to the information to be disclosed and the type of forum in
which such disclosure shall take place (except that, prior to the first press
release or other form of announcement with respect to this Agreement, no such
disclosure to the investment community may be made unless the party making such
disclosure shall have received, prior to such disclosure, the written consent of
the other party (unless required by any applicable Law or any regulation of any
securities exchange, securities trading system or similar regulatory body)). In
the event that either party hereto or its Affiliates is required to disclose any
of the terms and conditions of this Agreement or Confidential Information
pursuant to any applicable Law or any regulation of any securities exchange,
securities trading system or similar regulatory body, such party shall use its
reasonable efforts to obtain confidential treatment of the same pursuant to the
applicable rules regarding obtaining confidential treatment. Such party shall
give the other party prior written notice of such occurrence and shall
incorporate the other party&#146;s reasonable comments into the request for
confidential treatment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
17.2 <U>Confidentiality</U>. Without limiting the obligations set forth in
Section&#160;17.1, except as otherwise required by any applicable Law or any
regulation of any securities exchange, securities trading system or similar
regulatory body, Licensee and TDSF agree not to disclose to any third party
(other than to their Affiliates and their and their Affiliates&#146;
Representatives on a need-to-know basis only) or permit any third party to
disclose or use (other than the right of TDSF or Licensee or their Affiliates or
their and their Affiliates&#146; respective Representatives to use for purposes
of this Agreement) any non-public, confidential or proprietary information (the
"<B>Confidential Information</B>") that (i) TDSF, its Affiliates or any of its
or its Affiliates&#146; Representatives makes available to Licensee, its
Affiliates or any of its or its Affiliates&#146; Representatives or (ii)
Licensee, its Affiliates or any of its or its Affiliates&#146; Representatives
makes available to TDSF, TDSF&#146;s Affiliates or any of TDSF&#146;s or
TDSF&#146;s Affiliates&#146; Representatives in connection with this Agreement,
including any Confidential Information disclosed by one party to the other party
in connection with this Agreement at any time prior to the Effective Date and
thereafter throughout the Term. Each of Licensee and TDSF further agrees not to
use any such Confidential Information of the other in violation of any
applicable securities Laws, including, without limitation, prohibitions
thereunder pertaining to trading on material inside information. Such
Confidential Information shall include the negotiations leading to this
Agreement, the terms and conditions (including economic, legal and other terms)
of this Agreement and any agreement referred to herein, information that one
party may have caused to deliver to the other party that the delivering party
has designated as "Confidential" or "Proprietary" or in like words or
information that is generally treated as proprietary (such as financial and
operational information and Customer Data), whether or not in written form and
whether or not designated as confidential (including, without limitation,
systems and software, scripts, plots, storylines, characters and trade secrets
of either party hereto). Confidential Information shall not include information
that: (i)&#160;is or becomes publicly known (other than as a result of a breach
of this Agreement or any other legal duty by the receiving party, its Affiliates
or its or its Affiliates&#146; Representatives), (ii)&#160;is lawfully received
by the receiving party from a third party on a non-confidential basis, which
third party is not to the knowledge of the receiving party bound in a
confidential relationship with the disclosing party, or (iii)&#160;is generated
independently by or for the receiving party without the use of Confidential
Information of the disclosing party. Notwithstanding anything to the contrary
contained herein, the Confidential Information of Licensee and its Affiliates
shall not include any ideas, suggestions or concepts (except for any matters
that may be subject to prior patent or trademark protection or as may be
otherwise expressly provided for in this Agreement or any agreement executed at
the time such information is exchanged) that may be conceived or developed
during or as a result of any discussions, meetings or communications between the
parties hereto (or their respective Affiliates or Representatives) during the
Term (collectively, "<B>Ideas</B>"), and TDSF and its Affiliates shall be free
to use and exploit any such Ideas in any manner and for any purpose and in their
respective sole discretion, all without any restriction or any obligation,
liability or compensation to Licensee or its Affiliates. If a receiving party,
its Affiliates or its or its Affiliates&#146; Representatives are requested or
required to disclose any of the Confidential Information of a disclosing party
in an investigatory, legal, regulatory or administrative proceeding, such
receiving party will, to the extent possible, provide the disclosing party with
prompt notice thereof and, except in the case of a Tax proceeding, the
disclosing party may seek a protective order or other appropriate remedy. If no
such order or remedy is obtained, then the receiving party may, without
liability hereunder, disclose in such proceeding that portion of the
Confidential Information of the disclosing party that the receiving party&#146;s
legal counsel has advised the receiving party it is legally required to
disclose. Each of the parties hereto agrees that it shall be responsible for any
disclosure of Confidential Information by its Affiliates and its and its
Affiliates&#146; Representatives that would constitute a breach of this
Section&#160;17.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
17.3 <U>Survival of Section</U>. The provisions of Sections&#160;17.1 and 17.2
and the obligations of the parties thereunder shall survive the expiration or
earlier termination of this Agreement for a period of three (3) years
thereafter. </FONT></P>

<P><FONT SIZE=3>18.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>REPRESENTATIONS, WARRANTIES AND COVENANTS OF LICENSEE</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each of TDS USA and TDS Canada, jointly and severally, represents and warrants
to, and covenants with, TDSF (subject to the proviso immediately following
Section 12.1.10) as follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18.1 <U>Organization, Standing and Authority; Capitalization</U>. Prior to the
TDS USA Merger, TDS USA is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of California and,
following the TDS USA Merger, TDS USA will be a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Delaware. TDS Canada is a corporation duly incorporated, validly existing and in
good standing under the laws of the Province of Ontario. Each of TDS USA and TDS
Canada has the requisite power and authority to (i) execute and deliver this
Agreement and the documents and instruments contemplated hereby, (ii) perform
and comply with all of the terms, conditions and covenants to be performed and
complied with by it hereunder and thereunder, and (iii) own its properties and
assets and carry on its business as currently conducted. On the Effective Date,
(a) all Outstanding TDS USA Securities and all Outstanding TDS Canada Securities
are solely owned by Licensee Parent and Canadian Parent, respectively, (b) all
outstanding Licensee Parent Securities are solely owned by TCP, (c) all
outstanding Canadian Parent Securities are solely owned by TDS USA, and (d) none
of Licensee, Licensee Parent or Canadian Parent has any Subsidiaries nor any
other debt or equity investments in any other Person (other than Licensee
Parent&#146;s ownership of TDS USA Securities and Canadian Parent&#146;s
ownership of TDS Canada Securities). On the Effective Date, Licensee engages in
no other business or operation than the Business, and Licensee Parent and
Canadian Parent engage in no other business than holding all Outstanding TDS USA
Securities and all Outstanding TDS Canada Securities, respectively. Prior to or
on the Effective Date, Licensee has delivered to TDSF a true and complete copy
of Licensee&#146;s, Licensee Parent&#146;s and Canadian Parent&#146;s Governing
Documents, all of which remain in full force and effect without amendment or
modification; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18.2 <U>Authorization and Binding Obligation</U>. All necessary action on
Licensee&#146;s part has been duly and validly taken to authorize the execution,
delivery and performance of this Agreement and such other agreements and
instruments to be executed and delivered by Licensee in connection herewith.
This Agreement has been duly executed and delivered by Licensee and constitutes
its legal, valid and binding obligation enforceable against Licensee in
accordance with the terms hereof; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18.3 <U>Absence of Conflicting Agreements</U>. No consent, authorization,
approval, order, license, certificate or permit of or from, or declaration or
filing with, any Governmental Entity is required for Licensee&#146;s execution,
delivery and performance of this Agreement or any of the agreements or
instruments contemplated hereby. Neither the execution, delivery and performance
by Licensee of this Agreement or such other agreements and instruments nor the
consummation of the transactions contemplated hereby or thereby will:
(i)&#160;violate any provision of Licensee&#146;s Governing Documents;
(ii)&#160;violate any Law to which Licensee is subject that would have a
material adverse effect on Licensee&#146;s ability to perform its obligations
hereunder; (iii)&#160;violate any material Contract to which Licensee is a party
or is subject, or (iv)&#160;result in the imposition of any material Encumbrance
against Licensee or any of its properties; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18.4 <U>Claims; Legal Actions</U>. Other than as set forth in the "TDS
Schedules" delivered pursuant to the Acquisition Agreement, there is no Action
pending or, to the knowledge of Licensee, threatened against or affecting
Licensee or its Affiliates or any of its or their properties or assets that has
or might reasonably be expected to have a material adverse effect on
Licensee&#146;s ability to perform its obligations under this Agreement or the
transactions contemplated by this Agreement; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18.5 <U>Full Disclosure</U>. No representation or warranty made by Licensee in
this Agreement or in any certificate, document or other instrument furnished or
to be furnished pursuant hereto contains or will contain any untrue statement of
a material fact nor shall any such representation or warranty omit any material
fact necessary in order to make any statement contained herein or therein not
misleading; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18.6 <U>No Reliance</U>. Licensee acknowledges and agrees that, except as
expressly set forth herein, TDSF has not made, and Licensee is not relying on,
any representation or warranty, express or implied, with respect to the subject
matter hereof; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18.7 <U>No Broker Fees</U>. No agent, broker, finder, investment or commercial
banker, or other Person or firm engaged by or acting on behalf of Licensee or
any of its Affiliates in connection with the negotiation, execution or
performance of this Agreement or the transactions contemplated by this Agreement
is or will be entitled to any broker&#146;s or finder&#146;s or similar fees or
other commission as a result of this Agreement or such transactions, except for
any fee that may become payable to Peter J. Solomon, for which Licensee shall
have sole responsibility; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18.8 <U>Survival</U>. The representations and warranties contained in this
Section&#160;18 shall survive the execution and delivery of this Agreement
indefinitely. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>REPRESENTATIONS, WARRANTIES AND COVENANTS OF TDSF</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
TDSF represents and warrants to, and covenants with, Licensee (subject to the
proviso immediately following Section 12.2.6) as follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.1 <U>Organization, Standing and Authority; Rights in Disney Properties</U>.
TDSF is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of California. TDSF has the requisite power
and authority to (i)&#160;execute and deliver this Agreement and the documents
and instruments contemplated hereby, (ii)&#160;perform and comply with all of
the terms, conditions and covenants to be performed and complied with by it
hereunder and thereunder, and (iii)&#160;own its properties and assets and carry
on its business as currently conducted. Guarantor is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Florida. Guarantor<B> </B>has the requisite power and authority to
(i)&#160;execute and deliver the Disney Guarantee and the documents and
instruments contemplated thereby, (ii)&#160;perform and comply with all of the
terms, conditions and covenants to be performed and complied with by it
thereunder, and (iii)&#160;own its properties and assets and carry on its
business as currently conducted. TDSF has, and throughout the Term shall have,
pursuant to one (1) or more intercompany license agreements with any of its
Affiliates, sufficient rights in and to the name "Disney" and the Disney
Properties to perform and comply with all of its obligations hereunder, subject
to the terms and conditions hereof, and in the event that, during the Term, any
licensor under any such intercompany license agreement transfers the name
"Disney" together with all or a substantial portion of the Disney-Branded
Properties to another Person, TDSF shall cause such licensor to require, as a
condition to such transfer, that such Person confirm such intercompany license
agreement and the terms and conditions thereof or enter into a replacement
license agreement (or comparable instrument) with TDSF or its Affiliates (as
determined by TDSF in its sole discretion) pursuant to which TDSF shall continue
to have, throughout the Term, sufficient rights in and to the name "Disney" and
the Disney-Branded Properties to perform and comply with all of its obligations
hereunder, subject to the terms and conditions hereof; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.2 <U>Authorization and Binding Obligation</U>. All necessary action on the
part of each of TDSF and Guarantor has been duly and validly taken to authorize
the execution, delivery and performance of this Agreement, the Disney Guarantee
and such other agreements and instruments to be executed and delivered by them
in connection herewith. This Agreement and the Disney Guarantee have been duly
executed and delivered by TDSF and Guarantor, respectively, and constitute the
legal, valid and binding obligations of TDSF and Guarantor, respectively,
enforceable against TDSF and Guarantor, respectively, in accordance with the
terms hereof and thereof; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.3 <U>Absence of Conflicting Agreements</U>. No consent, authorization,
approval, order, license, certificate or permit of or from, or declaration or
filing with, any Governmental Entity is required for the execution, delivery and
performance by TDSF or Guarantor, as applicable, of this Agreement, the Disney
Guarantee or any of the agreements or instruments contemplated hereby or
thereby. Neither the execution, delivery and performance by TDSF or Guarantor,
as applicable, of this Agreement, the Disney Guarantee or such other agreements
and instruments nor the consummation of the transactions contemplated hereby or
thereby will: (i)&#160;violate any provision of TDSF&#146;s or Guarantor&#146;s
Governing Documents; (ii)&#160;violate any Law to which TDSF or Guarantor is
subject that would have a material adverse effect on TDSF&#146;s or
Guarantor&#146;s<B>
</B>ability to perform its obligations hereunder or under the Disney Guarantee;
(iii)&#160;violate any material Contract to which TDSF or Guarantor is a party
or is subject, or (iv)&#160;result in the imposition of any material Encumbrance
against TDSF or Guarantor or any of their respective properties; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.4 <U>Claims; Legal Actions</U>. There is no Action pending or, to the
knowledge of TDSF, threatened against or affecting TDSF or its Affiliates or any
of its or their properties or assets that has or might reasonably be expected to
have a material adverse effect on the respective abilities of TDSF or Guarantor
to perform their respective obligations under this Agreement or the Disney
Guarantee, as applicable, or the transactions contemplated hereby or thereby;
and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.5 <U>Full Disclosure</U>. No representation or warranty made by TDSF or
Guarantor in this Agreement or in any certificate, document or other instrument
furnished or to be furnished pursuant hereto contains or will contain any untrue
statement of a material fact nor shall any such representation or warranty omit
any material fact necessary in order to make any statement contained herein or
therein not misleading; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.6 <U>No Reliance</U>. TDSF acknowledges and agrees that, except as expressly
set forth herein, Licensee has not made, and TDSF and Guarantor are not relying
on, any representation or warranty, express or implied, with respect to the
subject matter hereof; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.7 <U>No Broker Fees</U>. No agent, broker, finder, investment or commercial
banker, or other Person or firm engaged by or acting on behalf of TDSF or any of
its Affiliates in connection with the negotiation, execution or performance of
this Agreement, the Disney Guarantee or the transactions contemplated hereby or
thereby is or will be entitled to any broker&#146;s or finder&#146;s or similar
fees or other commission as a result of this Agreement or such transactions,
except for any fee that may become payable to Bear Stearns and Goldman Sachs,
for which TDSF and/or its Affiliates shall have sole responsibility; and
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
19.8 <U>Survival</U>. The representations and warranties contained in this
Section&#160;19 shall survive the execution and delivery of this Agreement
indefinitely. </FONT></P>

<P><FONT SIZE=3>20.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>COMPLIMENTARY BENEFITS</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During each full calendar year during the Term, TDSF or its Affiliates shall, at
their sole cost and expense, provide Licensee with the following complimentary
benefits (<U>provided</U>, that Licensee acknowledges and agrees that all such
complimentary benefits provided by TDSF or its Affiliates under this Section 20
(i)&#160;may not be sold by Licensee, (ii)&#160;shall contain an expiration date
of December 31 of the calendar year in which they are issued, and
(iii)&#160;shall remain subject to TDSF and its Affiliates&#146; standard
policies and practices, as may be amended and supplemented by TDSF and its
Affiliates from time to time during the Term, applicable to Persons to whom
complimentary or reduced rate admission tickets or related benefits are issued):
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
20.1 An aggregate of fifty (50) complimentary one-day, one-park passes for
admission to either WALT DISNEY WORLD Resort&#146;s MAGIC KINGDOM&#174; Park,
EPCOT&#174;, Disney-MGM Studios, DISNEY&#146;S ANIMAL KINGDOM&#174; Theme Park,
Disney&#146;s Blizzard Beach Water Park, Disney&#146;s River Country Water Park
or Disney&#146;s Typhoon Lagoon Water Park, as Licensee may so elect
(<U>provided</U>, that, with respect to the foregoing three (3) water parks, the
number of one-day passes shall be limited to twenty-five (25) per calendar
year); </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
20.2 An aggregate of fifty (50) complimentary one-day park passes for admission
to either DISNEYLAND&#174; Park or DISNEY&#146;S CALIFORNIA ADVENTURE&#153;
Theme Park at DISNEYLAND Resort, as Licensee may so elect; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
20.3 "Silver Passes" for (i) each Licensee Employee who is an assistant Facility
manager, a Facility manager, a district manager, a regional manager or a
full-time director level or above employee located at the corporate headquarters
who is solely dedicated to the Business, and (ii) a limited number of select
senior executive officers of Licensee or its Affiliates whose primary
responsibilities are managing and/or supervising the relationship established
hereby as determined from time to time during the Term by TDSF in its sole
discretion (collectively, "<B>Silver Pass Holders</B>"). Each Silver Pass will
be separately issued in the name of the respective Silver Pass Holder but will
not identify the holder thereof as an employee of TDSF or its Affiliates. Silver
Passes may be subject to black-out periods or other comparable restrictions
generally applicable to complimentary passes. Silver Passes shall be promptly
returned to TDSF upon the date of expiration or earlier termination of this
Agreement. In addition, Licensee agrees to promptly notify TDSF of any changes
in either the employment status of any Silver Pass Holder or the
responsibilities (<U>i.e.</U>, responsibilities relating to the Business) of any
Silver Pass Holder, and, at TDSF&#146;s request, Licensee shall promptly return
to TDSF the Silver Pass with respect to any Silver Pass Holder who TDSF, in its
sole discretion, determines should no longer be entitled to hold a Silver Pass;
and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
20.4 A complimentary membership for one individual designated by Licensee and
reasonably acceptable to TDSF to "Club 33," which is a private club
(<U>i.e.</U>, not open to the general public, but available for use by select
corporate sponsors and for TWDC executives for business purposes) located within
DISNEYLAND&#174; Park at DISNEYLAND Resort, <U>provided</U>, that such
membership (i)&#160;shall be subject to the execution and delivery to TDSF of
the then-current form of membership agreement for Club&#160;33 and
(ii)&#160;shall not be effective at any time other than the Term. In connection
with Licensee&#146;s use of Club 33, Licensee shall be responsible for all
charges and costs (other than the annual membership fee) associated with the use
of Club 33 (<U>e.g.</U>, food and beverage costs). </FONT></P>

<P><FONT SIZE=3>21.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>MISCELLANEOUS</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.1 <U>Books and Records</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.1.1 <U>Right of Audit</U>. During the Term, Licensee and its Affiliates shall
at all times keep and maintain, in accordance with GAAP, accurate, complete and
up-to-date books and records pertaining to all operations of the Business and
Licensee&#146;s rights and obligations under this Agreement. TDSF shall have, no
more than twice during each Contract Year (which, in the first (1<FONT SIZE=1>>st</FONT>)
Contract Year, will include the Stub Period) (unless TDSF has credible
indications of non-compliance with this Agreement by Licensee, in which event a
more frequent audit shall be permitted) and during normal business hours and
upon at least five (5) Business Days&#146; prior written notice to Licensee, the
right to, or the right to have its Affiliates or its or its Affiliates&#146;
Representatives, conduct an audit (in accordance with the terms of this Section
21.1) of all such books and records for the sole purpose of verifying, and
solely to the extent necessary to verify, compliance with the provisions of this
Agreement. Licensee shall cooperate and cause its Affiliates to cooperate in all
respects with TDSF, its Affiliates and/or its or its Affiliates&#146;
Representatives in connection with such audits, including, without limitation,
making available the management and employees of Licensee and representatives of
Licensee&#146;s outside auditors to assist and answer questions relating
thereto. The costs and expenses associated with any such audits shall be borne
entirely by TDSF, except as provided in Section 21.1.2. Such audit rights
contained herein may be exercised at any time up to five (5) years following the
end of the Contract Year to which such books and records relate, and Licensee
and its Affiliates shall maintain such books and records for at least such
period of time, and, if any dispute between the parties hereto with respect to
this Agreement has arisen and remains unresolved at the expiration of such
period of time, for such reasonable period of time thereafter during the
attempted resolution of such dispute. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.1.2 <U>Underpayment or Overpayment Remedies</U>. If, upon any such audit of
books and records conducted in accordance with the terms of Section&#160;21.1.1,
one (1) or more errors shall be revealed, all related calculations prior to the
date on which such discovery is made may be reviewed, and the amount of any
overpayment or underpayment of amounts due to either party pursuant to the terms
of this Agreement that may be disclosed by such review, together with interest
accrued thereon from the date on which such underpayment or overpayment was made
until the amount thereof is paid or credited at the per annum interest rate set
forth in Section&#160;21.20, shall be paid and/or adjusted between the parties
hereto. If an error by Licensee results in there being due to TDSF an amount
equal to one percent (1%) or more of the Licensee Payments due to TDSF with
respect to any Contract Year, then the reasonable costs of examination, copying
and/or auditing that revealed such errors shall also be paid by Licensee.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.2 <U>Insurance</U>. At all times during the Term and for a period of eighteen
(18) months thereafter, Licensee shall maintain, at its own cost and expense, a
comprehensive program of insurance to adequately protect the respective
interests (including indemnification rights) of the parties hereunder,
including, without limitation, the following insurance coverage with carriers
and on forms that are reasonably acceptable to TDSF in each case (subject to the
other provisions of this Section&#160;21.2): </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) a policy or policies of commercial general liability insurance (including,
without limitation, contractual liability, products/completed operations
liability and cross-liability) with minimum limits of One Million Dollars
($1,000,000) per occurrence and maximum deductibles of Two Hundred Fifty
Thousand Dollars ($250,000) per occurrence covering bodily injury (including
death resulting therefrom), personal injury and/or property damage that may
arise from or in connection with Licensee's performance of or failure to perform
its obligations under this Agreement; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) a policy or policies of workers' compensation insurance as required by
applicable Law and employer's liability insurance with minimum limits of One
Million Dollars ($1,000,000) per occurrence and maximum deductibles of Two
Hundred Fifty Thousand Dollars ($250,000) per occurrence with respect to any
employee, agent, subcontractor or other Representative of Licensee or its
Affiliates performing services in connection with the Business or this
Agreement; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) a policy or policies of directors' and officers' insurance with minimum
limits of Ten Million Dollars ($10,000,000) per occurrence and maximum
deductibles of One Million Dollars ($1,000,000) per occurrence covering both the
Board Observers and the Independent Directors contemplated by Section 9.13; and
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) a policy or policies of excess liability covering General Liability,
Products/Completed Operations Liability, Auto Liability, and Employers Liability
with minimum limits of One Hundred Million Dollars ($100,000,000) per occurrence
and in the aggregate. If Seventy Five Million Dollars ($75,000,000) of this
aggregate is eroded, Licensee shall advise TDSF of this erosion immediately.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All insurance required hereby shall be placed with a carrier possessing an A-VII
rating or better as listed in the Best Guide and, except in the case of
workers&#146; compensation insurance required pursuant to subparagraph (iii) of
this Section 21.2, shall provide that no cancellation, reduction or non-renewal
of coverage thereunder may occur except upon at least twenty (20) Business
Days&#146; prior written notice to TDSF. With respect to all insurance policies
required hereunder or otherwise held by Licensee (other than policies for
workers&#146; compensation insurance required pursuant to subparagraph (iii) of
this Section 21.2), Licensee shall, within two (2) months after the Effective
Date, provide to TDSF certificates of insurance (or copies of policies, if
required by TDSF) (a)&#160;naming TDSF and its Affiliates, and the officers,
directors, agents and employees of each, as additional insureds and
(b)&#160;containing a waiver of subrogation with respect to such additional
insureds (which waiver of subrogation will apply to all insurance policies,
including policies for worker&#146;s compensation insurance). TDSF&#146;s or its
Affiliates&#146; failure to request, review or object to the terms of such
certificates of insurance or insurance policies shall not be deemed a waiver of
Licensee&#146;s obligations or the rights of TDSF or its Affiliates hereunder.
In the event Licensee fails to obtain all insurance required hereby within two
(2) months after the Effective Date, TDSF shall have the right to terminate this
Agreement upon twenty (20) Business Days&#146; prior written notice to Licensee.
All insurance required hereby shall be primary and non-contributory should other
insurance be available to TDSF and its Affiliates and the officers, directors,
agents and employees of each. The minimum limits of the insurance required in
this Section&#160;21.2 shall in no way limit or diminish Licensee&#146;s
liability under any other provisions of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.3 <U>Force Majeure</U>. If the performance by either party hereto of its
respective nonmonetary obligations under this Agreement is delayed in whole or
in part by acts of God, fire, floods, storms, explosions, accidents, epidemics,
war, civil disorder, strikes or other labor difficulties, or any Law or action
adopted or taken by any Governmental Entity, or any other cause not reasonably
within such party&#146;s control, whether or not specifically mentioned herein,
such party shall be excused, discharged and released of performance to the
extent such performance or obligation is so delayed by such occurrence without
liability of any kind. Nothing contained herein shall be construed as requiring
either party hereto to accede to any demands of, or to settle any disputes with,
labor or labor unions, suppliers or other parties that such party considers
unreasonable. The party subject to such a delay as contemplated herein shall,
within five (5) Business Days following the occurrence of any event of "Force
Majeure" as described hereunder, notify the other party hereto of such event and
the probable duration thereof. Notwithstanding the foregoing, if either party is
subject to an event of "Force Majeure" that persists for six (6) months or more
and that materially diminishes any rights of the other party hereunder, then
such other party shall be entitled to terminate this Agreement upon twenty (20)
Business Days&#146; prior written notice to the party subject to the event of
"Force Majeure." </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.4 <U>Waivers</U>. No release, discharge or waiver of any provision hereof
shall be enforceable against or binding upon either party hereto unless in
writing and executed by a duly authorized officer of each of the parties hereto.
Neither the failure to insist, nor any delay in insisting, upon strict
performance of any of the agreements, terms, covenants or conditions hereof, nor
the acceptance of monies due hereunder with knowledge of a breach of this
Agreement, shall be deemed a waiver of any rights or remedies that either party
hereto may have or a waiver of any subsequent breach or default in any of such
agreements, terms, covenants and conditions, and no waiver of any rights or
remedies that either party hereto may have in one instance shall be deemed to
constitute a waiver of such rights or remedies in any other instance.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.5 <U>Notices</U>. Unless otherwise specified herein, all notices, requests,
demands, consents and other communications hereunder, including, without
limitation, submissions by Licensee pursuant to Section 5 or Section 9.19, shall
be transmitted in writing and shall be deemed to have been duly given when hand
delivered, or upon delivery when sent by express mail, courier or other
recognized overnight mail or next day delivery service, charges prepaid, or
three (3) Business Days following the date mailed when sent by registered or
certified United States mail, postage prepaid, return receipt requested, or when
deposited with a public telegraph company for immediate transmittal, charges
prepaid, or when sent by facsimile, with a confirmation copy sent by recognized
overnight mail or next day delivery, charges prepaid, addressed as follows (or,
in the case of submissions by Licensee pursuant to Section 5 or Section 9.19,
addressed to the individual designated by TDSF): </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=40%>If to Licensee:</TD>
<TD WIDTH=55%>
The Disney Store, LLC<BR>
The Disney Store (Canada) Ltd.<BR>
c/o The Children's Place Retail Stores, Inc.<BR>
915 Secaucus Road<BR>
Secaucus, New Jersey  08540<BR>
Facsimile: (201) 558-2837<BR>
Attention: Chief Financial Officer
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=40%>
With a copy to:<BR>
(which shall not<BR>
constitute notice)
</TD>
<TD WIDTH=55%>
The Disney Store, LLC<BR>
The Disney Store (Canada) Ltd.<BR>
c/o The Children's Place Retail Stores, Inc.<BR>
915 Secaucus Road<BR>
Secaucus, New Jersey  08540<BR>
Facsimile: (201) 558-2825<BR>
Attention:  General Counsel
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=40%>
With a copy to:<BR>
(which shall not<BR>
constitute notice)
</TD>
<TD WIDTH=55%>
Stroock &amp; Stroock &amp; Lavan LLP<BR>
180 Maiden Lane<BR>
New York, New York 10038<BR>
Facsimile: (212) 806-6006<BR>
Attention: Jeffrey S. Lowenthal, Esq.
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=40%>If to TDSF:</TD>
<TD WIDTH=55%>
TDS Franchising, LLC<BR>
c/o The Walt Disney Company<BR>
500 South Buena Vista Street (MC: 6916)<BR>
Burbank, California 91521-6916<BR>
Attn.: Anne Gates, EVP and CFO<BR>
Facsimile: (818) 559-6215
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=40%>
With a copy to:<BR>
(which shall not<BR>
constitute notice)
</TD>
<TD WIDTH=55%>
The Walt Disney Company<BR>
500 South Buena Vista Street<BR>
Burbank, California 91521-0930<BR>
Attn.: General Counsel<BR>
Facsimile: (818) 238-0404
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=40%>
With a copy to:<BR>
(which shall not<BR>
constitute notice)
</TD>
<TD WIDTH=55%>
The Walt Disney Company<BR>
500 South Buena Vista Street<BR>
Burbank, California 91521-0930<BR>
Attn.: James Kapenstein, Esq.<BR>
Facsimile: (818) 562-1813
</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
or such other address or facsimile number as may be designated by either party
hereto by written notice to the other in accordance with this Section&#160;21.5.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.6 <U>Entire Agreement</U>. The provisions contained in this Agreement
(including the Disney Guarantee and the Schedules), the Acquisition Agreement,
the TCP Guaranty and Commitment and/or any other documents, agreements and
instruments contemplated hereby or thereby or to be executed and delivered in
connection herewith or therewith or pursuant hereto or thereto constitute the
entire agreement between the parties hereto with respect to the subject matter
hereof and supersede and replace any and all previous agreements between the
parties, whether written or oral with respect to such subject matter. No
statement or inducement with respect to the subject matter hereof by any party
hereto or by any agent or representative of any party hereto that is not
contained in this Agreement (including the Disney Guarantee and the Schedules),
the Acquisition Agreement, the TCP Guaranty and Commitment and/or any other
documents, agreements and instruments contemplated hereby or thereby or to be
executed and delivered in connection herewith or therewith or pursuant hereto or
thereto shall be valid or binding between the parties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.7 <U>Joint Venture/Partnership Disclaimer</U>. The parties hereby acknowledge
that it is not their intention to create between themselves a partnership, joint
venture, fiduciary, employment or agency relationship for purposes of this
Agreement, or for any other purpose whatsoever. Accordingly, notwithstanding any
expressions or provisions contained herein or in any other document executed or
delivered or to be executed or delivered, nothing herein shall be construed or
deemed to create, or to express an intent to create, a partnership, joint
venture, fiduciary, employment or agency relationship of any kind or nature
whatsoever between the parties hereto. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.8 <U>Accord and Satisfaction</U>. Payment by any party hereto, or receipt or
acceptance by a receiving party, of any payment due hereunder in an amount less
than the amount required to be paid hereunder shall not be deemed an accord and
satisfaction or a waiver by the receiving party of its right to receive and
recover the full amount of such payment due hereunder, notwithstanding any
statement to the contrary on any check or payment or on any letter accompanying
such check or payment. The receiving party may accept such check or payment
without prejudice to the receiving party&#146;s right to recover the balance of
such payment due hereunder or to pursue any other legal or equitable remedy
provided in this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.9 <U>Relationship of Parties</U>. Except as may be specifically provided
under any provision of this Agreement, nothing contained in this Agreement shall
(i)&#160;authorize, empower or constitute any party as agent of any other party
in any manner, (ii)&#160;authorize or empower one party to assume or create an
obligation or responsibility whatsoever, express or implied, on behalf of or in
the name of any other party; or (iii)&#160;authorize or empower a party to bind
any other party in any manner, make any representation, warranty, covenant,
agreement or commitment on behalf of any other party, or permit a party to hold
itself out as having the authority to do any of the foregoing. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.10 <U>Effect of Headings</U>. The headings and subheadings of the sections of
this Agreement are inserted for convenience of reference only and shall not
control or affect the meaning or construction of any of the agreements, terms,
covenants or conditions of this Agreement in any manner. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.11 <U>Construction</U>. This Agreement has been fully reviewed and negotiated
by the parties hereto and their respective counsel. Accordingly, in interpreting
this Agreement, no weight shall be placed upon which party hereto or its counsel
drafted the provision being interpreted and prior drafts of this Agreement shall
be disregarded and inadmissible as proof or indication of the intent of the
parties or for any other purpose in the event of any other controversy regarding
the meaning, construction or interpretation of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.12 <U>Non-Assignment by Licensee</U>. Licensee shall not Transfer, in any
manner whatsoever, voluntarily or involuntarily or by operation of Law, this
Agreement or any interest or benefit of Licensee contained herein (including,
without limitation, Licensee&#146;s rights and duties of performance), except
that Licensee may Transfer this Agreement in connection with a Transfer of all
or substantially all of Licensee&#146;s properties and assets to a Person who is
a Qualified Person, <U>provided</U>, that TDSF shall have obtained a Guaranty
Assumption and a License Assumption in connection with such Transfer. There
shall be no limitation, prohibition or restriction on the right of TDSF to
Transfer, in any manner whatsoever, this Agreement or any interest or benefit of
TDSF contained herein (including, without limitation, TDSF&#146;s rights and
duties of performance); <U>provided</U>, that (i) the Disney Guarantee shall
remain in effect after any such Transfer and (ii) the Person to which TDSF
Transfers this Agreement (or any interest or benefit of TDSF contained herein)
shall have the ability to perform TDSF&#146;s duties and obligations hereunder.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.13 <U>Severability</U>. If any term or provision of this Agreement shall be
found to be void or contrary to any applicable Law, such term or provision shall
be deemed to be severable from the other terms and provisions hereof, but only
to the extent necessary to bring this Agreement within the requirements of such
Law, and the remainder of this Agreement shall be given effect as if the parties
hereto had not included the severed term herein; <U>provided</U>, that, if the
party that would be adversely affected by such severance demonstrates that a
material inducement to its entering into this Agreement would be materially
impaired, such party shall be entitled to seek to terminate this Agreement on
that ground. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.14 <U>Amendments</U>. No provision of this Agreement may be modified,
supplemented or amended except by a written instrument duly executed by each of
the parties hereto. Any such modifications, supplements or amendments shall not
require additional consideration to be effective. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.15 <U>Counterparts; Facsimile Signatures</U>. This Agreement may be executed
in two or more counterparts, each of which shall be deemed an original but all
of which together shall constitute one and the same instrument. Facsimile
signatures to this Agreement shall be effective. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.16 <U>Schedules</U>. The Schedules to this Agreement, as designated herein
and delivered concurrently with the execution hereof by TDSF to Licensee, shall
each be deemed to form an integral part of this Agreement and to be incorporated
herein as if herein set out in full. Capitalized terms used in the Schedules and
not otherwise defined in the Schedules shall have the respective meanings
ascribed to them in this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.17 <U>No Third Party Beneficiaries</U>. Nothing in this Agreement is
intended, or shall be deemed to, confer any rights or benefits upon any Person
other than the parties hereto or to make or render any such other Person a
third-party beneficiary of this Agreement, except to the extent that an
Affiliate of either party or any officers, directors, agents, representatives,
employees, successors or assigns of a party or any of its Affiliates have any
rights (including a right to be indemnified pursuant to Section&#160;12) under
this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.18 <U>Further Assurances</U>. Each party hereto shall, upon request by the
other party, execute any and all further documents or instruments and take such
additional actions as the other party may deem reasonably necessary to carry out
the proper purposes of this Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.19 <U>Conflicts of Interest</U>. Each of the parties hereto shall exercise
reasonable care and diligence to prevent their respective employees and agents
from making, receiving, providing or offering substantial gifts, entertainment,
payments, loans or other consideration for the purpose of influencing the other
party&#146;s employees or any vendors, contractors or other parties to act to
the detriment of such other party. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.20 <U>Interest</U>. All arrearages in the payment of any sums due to either
party hereto under the provisions of this Agreement shall bear interest from the
due date until paid at the lesser of the (i) per annum amount that is equal to
two percent (2%)
<U>plus</U> the Prime Rate and (ii) the highest rate of interest then allowable
pursuant to applicable Law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.21 <U>Governing Law; Remedies</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.21.1 Except to the extent governed by the United States Copyright Act, the
United States Trademark Act of 1946 (Lanham Act, 15 U.S.C. Sections 1051
et&#160;seq.) or other federal law of the United States, this Agreement shall be
deemed to have been entered into in the State of California and shall be
interpreted and construed in accordance with the laws of the State of California
applicable to agreements executed and to be performed therein by each party
hereto. Under no circumstances shall any laws enacting the United Nations
Convention on Contracts for International Sale of Goods apply to this Agreement.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.21.2 Each party hereby acknowledges and agrees that: (i) in the event of any
breach or prospective breach of this Agreement by TDSF, Licensee&#146;s remedy
shall be limited solely to monetary damages (if and to the extent available),
and Licensee hereby waives any and all rights it may have to any form of
equitable relief, including, without limitation, any temporary restraining
order, preliminary injunction, permanent injunction, specific performance or any
other form of relief in equity; <U>provided</U>, that this Section 21.21.2 shall
not prohibit Licensee from obtaining such equitable relief (if such relief is
otherwise available and Licensee is able to satisfy the requirements necessary
to obtain such relief) against TDSF and/or its Affiliates (but not against any
third party licensee of TDSF or any of its Affiliates) in the case of (a)
TDSF&#146;s breach of Section&#160;17 or (b) TDSF&#146;s Uncured Material Breach
of subparagraph (A) of Section 6.1; and (ii) in the event of any breach or
prospective breach of this Agreement by Licensee (including, without limitation,
any Licensee Infringing Use), TDSF&#146;s remedy shall include, without
limitation, monetary damages (if and to the extent available), any form of
equitable relief, including, without limitation, any temporary restraining
order, preliminary injunction, permanent injunction, specific performance or any
other form of relief in equity (if such relief is available and TDSF is able to
satisfy the requirements necessary to obtain such relief), and any other right
or remedy available to TDSF as a result of such breach under this Agreement, at
law, in equity or otherwise. In the case of any action for equitable relief by
either party hereto that is permitted pursuant to the preceding sentence (each,
an "<B>Equitable Action</B>"), the parties acknowledge and agree that money
damages may not be an adequate remedy and that, in such action, the
non-breaching party may, in its sole discretion, apply to a court of competent
jurisdiction for a temporary restraining order, a preliminary injunction, a
permanent injunction, specific performance or other form of equitable relief
(without the posting of any bond or other security) as such court may deem just
and proper in order to enforce the applicable provision of this Agreement or
prevent any violation thereof and, to the extent permitted under applicable Law,
each party hereto waives any objection to the imposition of such relief in any
such Equitable Action. Any such equitable relief granted in an Equitable Action
shall not be exclusive and any party seeking such relief shall also be entitled
to seek and enforce any other right or remedy available to it, including money
damages. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.21.3 In any Equitable Action, the non-breaching party shall be entitled, in
its sole discretion, to seek recourse and remedy through either (i) the dispute
resolution procedures set forth in Section 21.23 or (ii) a legal proceeding
submitted for trial before the Superior Court in and for the County of Los
Angeles, State of California, or the United States District Court for the
Central District of California, or if neither such court shall have
jurisdiction, then before any other court sitting in Los Angeles County,
California, having subject matter jurisdiction. The parties hereto consent to
the exclusive jurisdiction of such courts in connection with any Equitable
Action and to service of process outside of the State of California pursuant to
the requirement of any such court in any matter subject to it. With respect to
any dispute arising under this Agreement other than an Equitable Action, the
parties hereto agree that all such disputes shall be resolved through the
dispute resolution procedures set forth in Section&#160;21.23; <U>provided</U>,
that, if TDSF shall bring any Equitable Action in any court pursuant to
subparagraph&#160;(ii) of this Section&#160;21.21.3, it shall be entitled to
seek any other remedy in addition to equitable relief, including money damages,
to the extent permitted hereby in the same court proceeding and shall not be
required to submit such matter to dispute resolution under Section&#160;21.23.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.21.4 The provisions of this Section&#160;21.21 shall survive the expiration
or earlier termination of this Agreement indefinitely. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.22 <U>Limitation of Liability</U>. Notwithstanding anything contained herein
to the contrary, except (i)&#160;for any Loss paid to third parties for which
either party hereto is obligated to indemnify the other party pursuant to
Section&#160;12 and (ii)&#160;in the case of a willful or grossly negligent
Licensee Infringing Use or any other willful or grossly negligent misuse by
Licensee or its Affiliates of any name, brand, trademark, logo, symbol,
character or other proprietary designation or intellectual property of TDSF or
any of its Affiliates, neither party shall be liable under this Agreement to the
other party for any punitive, exemplary, consequential, incidental, indirect,
special or speculative damages (including loss of profits) based upon breach of
warranty, breach of contract, negligence, strict liability and tort, or any
other legal theory. With respect to the matters specified in the preceding
subparagraphs&#160;(i) and (ii), no such limitation on damages shall apply.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23 <U>Arbitration Procedures</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.1 <U>Management Negotiations</U>. Except as otherwise provided in
Section&#160;21.21, in the event of any controversy, dispute or claim between
TDSF or any of its Affiliates, on the one hand, and Licensee or any of its
Affiliates, on the other hand, arising out of or relating to this Agreement or
any provisions hereof or the validity of this Agreement, the parties hereto
agree that, prior to submitting such controversy, dispute or claim to the
arbitration proceedings described below in this Section&#160;21.23, it shall be
submitted to the President of TWDC and the Chief Executive Officer of Licensee
(or, if no person holds either such title, a senior executive officer of such
entity performing a similar function), who shall negotiate in good faith with
one another for a period of not less than five (5) Business Days in an effort to
resolve such controversy, dispute or claim. Notwithstanding the foregoing, in
the case of any Licensee Infringing Use or any other misuse by Licensee or its
Affiliates of any name, brand, trademark, logo, symbol or other proprietary
designation or intellectual property of TDSF or its Affiliates, TDSF may elect,
in its sole discretion, to forego the procedure required by this
Section&#160;21.23.1 and proceed directly to arbitration under
Section&#160;21.23.2. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.2 <U>Arbitrable Disputes</U>. Except as otherwise provided in
Section&#160;21.21, all controversies, disputes and claims between TDSF and/or
its Affiliates, on the one hand, and Licensee and/or its Affiliates, on the
other hand, arising out of or relating to this Agreement or any provision hereof
or the validity of this Agreement that have not been resolved through the
procedure set forth in Section&#160;21.23.1 (collectively, <B>"Arbitrable
Disputes</B>") must be resolved through binding arbitration administered by ADR
Services (the "<B>Arbitration Administrator</B>") in accordance with the terms
of this Section&#160;21.23, or such other entity agreed upon by the parties
hereto to administer the arbitration of an Arbitrable Dispute. Except as
otherwise set forth in this Section&#160;21.23, the U.S. Arbitration Act shall
govern the interpretation and enforcement of, and proceedings pursuant to, the
provisions of this Section&#160;21.23. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.3 <U>Applicability of California Procedural Law</U>. Unless otherwise
stipulated in writing or on the record before the Arbitrator or the Appellate
Arbitrators, in either case by all of the parties involved in an Arbitrable
Dispute (the "<B>Arbitration Parties</B>") or affected by the stipulation, all
Arbitrable Disputes will be governed by California procedural law, including,
but not limited to, the procedures set forth in the California Code of Civil
Procedure, the California Civil Code, the California Evidence Code, and the
California Rules of Court (but not including any local rules), except to the
extent such procedures are inconsistent with the express terms of this
Section&#160;21.23. It is the intent of the Parties that all pleadings,
discovery, motion practice, trial and appeal (including, but not limited to, the
format, scope, and substance of, and time requirements applicable to, any
filings) proceed as if the Arbitrable Dispute had been brought in the Superior
Court of the State of California, except: (i) the Arbitrator and Appellate
Arbitrators will be appointed in accordance with Section&#160;21.23.5; (ii) the
Arbitrator will serve as the finder of fact (and the parties waive any right to
a jury); (iii) there will be no interlocutory appellate (<U>e.g.</U>, writ)
relief available; (iv) discovery will be limited to matters that are directly
relevant to the issues in the arbitration unless, upon a finding of good cause
by the Arbitrator, leave is granted to conduct discovery that is reasonably
calculated to lead to the discovery of admissible evidence; and (v) as otherwise
expressly provided for in this Section&#160;21.23. The parties hereto agree to
be bound by the provisions of any limitation on the period of time in which
claims must be brought under applicable Law or this Agreement, whichever expires
earlier. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.4 <U>Arbitration Complaints and Notices</U>. Any arbitration complaint for
an Arbitrable Dispute (a <B>"Complaint</B>") or notice of appeal from an
arbitration judgment (an "<B>Appeal Notice</B>") hereunder shall be served on
the Arbitration Parties pursuant to the notice provisions contained in
Section&#160;21.5 (in the case of notice to Affiliates of either party hereto,
notice to such party shall be deemed sufficient for purposes hereof). For
purposes of this Section&#160;21.23, service of all pleadings and other papers,
and the calculation of all time deadlines, shall be made in accordance with
California procedural law (including any modifications thereto that the
Arbitrator or Appellate Arbitrators may make in accordance with California
procedural law). However, without any order by the Arbitrator or Appellate
Arbitrators, the Arbitration Parties may agree in writing to extend or shorten
any time deadline, which will be deemed effective upon written notice by the
affected Arbitration Parties to the Arbitration Administrator and all other
Arbitration Parties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.5 <U>Selection of Arbitrator and Appellate Arbitrators</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Within five (5) Business Days after service of a Complaint or an Appeal
Notice, as the case may be, the Arbitration Parties will select their jointly
agreed upon arbitrator or, in the case of an appeal, three (3) appellate
arbitrators. The arbitrator shall be a former judge of the California Superior
Court (or, if an insufficient number of such former judges are available to
serve, former judges from the United States District Court for the Central
District of California) and the appellate arbitrators shall be former judges of
the California Court of Appeals (or, if an insufficient number of such former
judges are available to serve, former judges from the California Superior Court
who sat on the California Court of Appeals by designation, or, if an
insufficient number of such former judges are available to serve, former judges
from the California Superior Court who served on the bench for ten (10) years or
more). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) If the Arbitration Parties cannot agree upon an arbitrator or all three (3)
appellate arbitrators within such time period, on the fifth (5<FONT SIZE=1>th</FONT>)
Business Day thereafter, the Arbitration Parties will simultaneously exchange a
list of five (5) proposed arbitrators or, in the case of an appeal, ten (10)
proposed appellate arbitrators (the <B>"Party Designations"</B>). Any persons
appearing on both Party Designations shall be designated as the arbitrator or
the appellate arbitrators, selected in alphabetical order by last name. If for
any reason a person so selected cannot or will not serve as arbitrator or
appellate arbitrator, the next person common to both Party Designations in
alphabetical order by last name shall be designated as the arbitrator or
appellate arbitrator and so on until there are no more persons common to both
Party Designations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) If the arbitrator or any appellate arbitrator remains to be selected
following the procedures set forth in the preceding subparagraph (b), each
Arbitration Party shall have the right to strike up to two names appearing on
the other's Party Designation and, on the fifth (5<FONT SIZE=1>th</FONT>) Business Day
following exchange of the Party Designations, shall notify the other Arbitration
Party, in writing, of the names, if any, so stricken (the "<B>Strike
Notices</B>"). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d) Each party shall then rank each person remaining on both Party Designations
in numerical order of preference (1 being the most preferred, 2 being next, and
so on), and, on the second (2<FONT SIZE=1>ND</FONT>) Business Day following service of
the Strike Notices, the Arbitration Parties shall simultaneously exchange their
respective rankings (the <B>"Priority Designations"</B>). The person with the
lowest combined total from the Priority Designations shall be designated as the
arbitrator or, in the case of an appeal, the three (3) persons with the lowest
combined totals from the Priority Designations shall be designated as the
appellate arbitrators. Any ties will be broken by choosing the person first in
alphabetical order by last name. If, for any reason, a person so selected cannot
or will not serve as arbitrator or appellate arbitrator, the next person in
order using the methodology prescribed in this Section 21.23.5 shall be
designated as arbitrator or appellate arbitrator and so on until no more names
appear on the Arbitration Parties' Priority Designations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(e) If there are no more names from which to select an arbitrator or appellate
arbitrator on the parties' Priority Designations or if any party fails to comply
with the selection procedures herein, the Arbitration Administrator shall
provide a list of five (5) persons or, in the case of an appeal, ten (10)
persons, all of whom shall be former judges complying with the requirements of
Section 21.23.5(a). Each Arbitration Party may strike up to two (2) names from
this list, and of those who are left the person whose name is first in
alphabetical order by last name shall serve as arbitrator or, in the case of an
appeal, the first three (3) persons in alphabetical order by last name shall
serve as appellate arbitrators. The person selected pursuant to this Section
21.23.5 to serve as arbitrator is referred to herein as the <B>"Arbitrator"</B>
and the persons selected pursuant to this Section 21.23.5 to serve as appellate
arbitrators are referred to herein as the <B>"Appellate Arbitrators."</B>
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(f) Within two (2) Business Days after selection of the Arbitrator or the
Appellate Arbitrators, the Arbitration Parties will inform the Arbitration
Administrator, in writing and on a confidential basis, of the name and contact
information of the Arbitrator or the Appellate Arbitrators. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(g) If the Arbitrator or any Appellate Arbitrator becomes unable to serve for
any reason, the next arbitrator or appellate arbitrator who would have been
chosen pursuant to the procedure set forth in this Section 21.23.5 shall be
selected or, if there is no such arbitrator or appellate arbitrator available as
a result of such procedure, the Arbitration Parties shall repeat the procedure
set forth in this Section 21.23.5 to select another arbitrator or appellate
arbitrator. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.23.6
<U>Arbitrator Neutrality</U>. In order to serve as an Arbitrator or Appellate
Arbitrator for a Arbitrable Dispute, the appointed Arbitrator or Appellate
Arbitrator must be neutral with respect to the matters being arbitrated, the
Arbitration Parties, and their counsel, consistent with California Code of Civil
Procedure &#167;&#160;170.1. The Arbitration Administrator is responsible for
ensuring that appropriate disclosures are made by the Arbitrator and Appellate
Arbitrators to achieve and maintain such neutrality. If there is a dispute over
the neutrality of an appointed Arbitrator or Appellate Arbitrator, the dispute
shall be resolved by the Arbitration Administrator. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.23.7 <U>Emergency
Relief</U>. Subject to the limitations contained in Section 21.21.2, if an
Arbitration Party is seeking emergency relief prior to the appointment of the
Arbitrator, the parties hereto agree that the AAA Optional Rules for Emergency
Measures of Protection shall apply, but that the Arbitration Administrator shall
appoint an arbitrator to preside over the emergency proceedings (the
"<B>Emergency Arbitrator</B>"). The Emergency Arbitrator shall have
jurisdiction: (i) only until the selection of the Arbitrator in accordance with
Section 21.23.5; and (ii) only over such matters requiring emergency relief.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.23.8
<U>Arbitration Hearing/Arbitrator&#146;s Rulings, Statement of Decision and
Judgment</U>. Unless otherwise agreed among all Arbitration Parties and the
Arbitrator, there shall be a record of all proceedings conducted in conjunction
with any arbitration. The Arbitrator will be vested with the full powers of a
judge of the Superior Court of the State of California and will have the right
to award or include in the Arbitrator&#146;s award any relief that the
Arbitrator deems proper in the circumstances, subject to the limitations set
forth in Section&#160;21.21.2 on equitable relief and subject to the limitation
on liability set forth in Section&#160;21.22, including, without limitation,
money damages (with interest on unpaid amounts from the date due) and specific
performance, a temporary restraining order, a preliminary and/or permanent
injunction or other equitable relief (but only to the extent permitted by
Section&#160;21.21.2), <U>provided</U>, that the Arbitrator will not have the
authority to declare any mark generic or otherwise invalid except to the extent
necessary to rule on any claim of intellectual property infringement between the
parties hereto (in which event such ruling shall be binding as between the
parties hereto but such ruling shall not be binding as between either party
hereto and any other Person). The Arbitrator shall issue rulings, a statement of
decision, and a judgment as if the Arbitrator were a judge of the Superior Court
of the State of California. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.9 <U>Appeal</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Within twenty (20) Business Days following receipt of any judgment, any
Arbitration Party may notify the Arbitration Administrator of an intention to
appeal to an arbitral tribunal. To appeal the judgment of an Arbitrator, an
Arbitration Party must follow all of the prerequisites for appealing a judgment
of the Superior Court of the State of California. All prerequisites ordinarily
directed to the clerk of such court shall be directed to the Arbitration
Administrator. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) All appeals will be made to three (3) Appellate Arbitrators appointed (or
replaced, if necessary) pursuant to Section 21.23.5. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) The Appellate Arbitrators will conduct a hearing, review the judgment of the
Arbitrator, and issue an appellate decision applying the same standards of
review (and all of the same presumptions) as if the Appellate Arbitrators were
judges of the California Court of Appeal reviewing a judgment of the Superior
Court. The Appellate Arbitrators will be vested with the same powers as a
California Court of Appeal (including the power to remand a matter to an
Arbitrator, or a replacement Arbitrator, in accordance with the rights of a
party following an appeal). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d) The Appellate Arbitrators' decision will be final and binding (unless
remanded to the Arbitrator, or replacement Arbitrator, pursuant to subparagraph
(c) of this Section 21.23.9), as to all matters of substance and procedure.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.10 <U>Jurisdiction/Venue/Enforcement of Award</U>. The parties hereto
consent and submit to the exclusive personal jurisdiction and venue of the
Superior Court and the United States District Court, located in the County of
Los Angeles, State of California, to compel arbitration of an Arbitrable Dispute
in accordance with this Section 21.23, to enforce any arbitration award granted
pursuant to this Section 21.23, including, without limitation, any award
granting equitable relief, and to otherwise enforce this Section 21.23 and carry
out the intentions of the parties to resolve all Arbitrable Disputes through
arbitration. All arbitrations under this Section 21.23 shall be conducted in Los
Angeles, California. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.11 <U>Discovery</U>. Subject to and without limiting Section 21.23.3, (i)
each Arbitration Party will, upon the written request of the other Arbitration
Party, promptly provide the other with copies of documents relevant to the
issues raised by any claim or counterclaim; (ii) at the request of an
Arbitration Party, the Arbitrator shall have the discretion to order examination
by deposition of witnesses to the extent the Arbitrator deems such additional
discovery relevant and appropriate (<U>provided</U>, that each Arbitration Party
shall be entitled, in its sole discretion, to conduct depositions of up to five
(5) fact witnesses and up to two (2) expert witnesses); (iii) all objections are
reserved for the arbitration hearing except for objections based on privilege
and proprietary or confidential information; (iv) any dispute regarding
discovery, or the relevant scope thereof, shall be determined by the Arbitrator,
which determination shall be conclusive; and (v) all discovery shall be
completed within the time period established by the Arbitrator. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.12 <U>Res Judicata, Collateral Estoppel and Law of the Case</U>. A
decision of the Arbitrator and Appellate Arbitrators shall have the same force
and effect with respect to collateral estoppel, res judicata and law of the case
that such decision would have been entitled to if decided in a court of law, but
in no event shall such award be used by or against an Arbitration Party in a
Non-Signatory Dispute. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.13 <U>Confidential Proceedings</U>. All arbitration proceedings,
including, without limitation, any appellate proceedings, will be closed to the
public and confidential, and all records relating thereto will be maintained by
the Arbitration Parties as Confidential Information in accordance with
Section&#160;17 and will be permanently sealed, except as necessary to obtain
court confirmation of the judgment of the Arbitrator or the decision of the
Appellate Arbitrators, as applicable, and except as necessary to give effect to
res judicata and collateral estoppel (<U>e.g.</U>, in a dispute between the
Arbitration Parties that is not an Arbitrable Dispute), in which case all
filings with any court shall be sealed to the extent permitted by the court and
applicable Law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.14 <U>Arbitrator Fees and Arbitration Costs</U>. The Arbitrators or
Appellate Arbitrators, as the case may be, will have no authority to award any
damages that are inconsistent with Section 21.22. The Arbitration Parties will
share equally the fees of the Arbitrator and Appellate Arbitrators and
administrative costs of the arbitration (including reporter&#146;s fees, but not
including filing fees), with each side obligated for its pro rata share of the
total (subject to reallocation as provided below). The determination of whether
there are more than two sides will be made by the Arbitration Administrator,
which determination may be reviewed by the Arbitrator upon the request of any
Arbitration Party. The fees of the Arbitrator and Appellate Arbitrators and
administrative costs of the arbitration paid by the prevailing Arbitration Party
(as determined at the conclusion of all proceedings, including any appeal,
remand or subsequent appeals) will be awarded as costs to the prevailing
Arbitration Party. The entitlement of an Arbitration Party to attorneys&#146;
fees and other additional costs shall be determined in accordance with any
agreements between the Arbitration Parties governing such matters and California
procedural law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.15 <U>Non-Signatory Legal Actions</U>. As used in this Section 21.23,
"Arbitrable Dispute" does not include compulsory or permissive cross-claims
between the parties that arise in a legal action brought by or against a
non-signatory hereto ("<B>Non-Signatory Dispute</B>"). However, a party that has
the right to assert a permissive cross-claim against another party in a
Non-Signatory Dispute may choose to treat that claim as an Arbitrable Dispute
and assert it in accordance with the terms of this Section&#160;21.23.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.16 <U>Expedited Procedures</U>. Consistent with the expedited nature of
arbitration, it is the mutual intent of the parties that under all circumstances
any controversies, disputes or claims between them be resolved expeditiously,
and either Arbitration Party may, upon application to the Arbitrator for good
cause shown, move the Arbitrator for extraordinary expedition (including,
without limitation, the fixing of a discovery cut-off date and dates for the
commencement and completion of hearings). In furtherance thereof and without
limiting the foregoing, any application by TDSF to the Arbitrator to move for
extraordinary expedition in the case of a Licensee Infringing Use (which
application shall be made by TDSF in its sole discretion) shall be deemed to be
for good cause (without the requirement of any discovery, hearing or other
action or proceeding with respect to such application), and Licensee hereby
consents to the granting of any such application by TDSF in the case of a
Licensee Infringing Use. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.17 <U>No Declaratory Relief</U>. Notwithstanding anything contained herein
to the contrary, Licensee shall not be entitled to submit any action for
declaratory relief (or any comparable action for a determination that Licensee
has not violated, defaulted under or otherwise breached this Agreement or any
other related agreement entered into in connection herewith) to the arbitration
proceedings contemplated by this Section 21.23 or in court or through any other
dispute resolution mechanism other than as contemplated by Section&#160;21.23.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.23.18 <U>Survivability</U>. The provisions of this Section&#160;21.23 shall
survive the expiration or earlier termination of this Agreement indefinitely.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.24 <U>Certain Licensee Fees</U>. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.24.1 <U>General</U>. In the case of a Licensee Infringing Use, a Royalty
Breach or any other Material Breach by Licensee, without prejudice to any other
right or remedy available to TDSF or its Affiliates as a result thereof,
Licensee shall pay to TDSF a fee (the "<B>Licensee Infringement/Breach Fee</B>")
in the amount of Five Thousand Dollars ($5,000) (as adjusted and increased each
Contract Year as provided in Section&#160;21.24.2) per day per Facility,
Internet Store or other Business Property affected by such Licensee Infringing
Use, Royalty Breach or other Material Breach for the period beginning (a) in the
case of a Licensee Infringing Use or Royalty Breach, on the second
(2<FONT SIZE=1>nd</FONT>) Business Day following the day on which TDSF delivers written
notice to Licensee of such Licensee Infringing Use or Royalty Breach, as
applicable, or (b) in the case of any other Material Breach by Licensee, on the
fourth (4<FONT SIZE=1>th</FONT>) Business Day following the day on which TDSF delivers
written notice to Licensee of such Material Breach, and ending on the day on
which such Licensee Infringing Use, Royalty Breach or other Material Breach is
Cured, <U>provided</U>, that in no event shall the Licensee Infringement/Breach
Fee for any particular Licensee Infringing Use, Royalty Breach or other Material
Breach by Licensee exceed either Twenty-Five Thousand Dollars ($25,000) per day
or One Hundred Fifty Thousand Dollars ($150,000) in the aggregate (each such
daily and aggregate limit, as adjusted and increased each Contract Year as
provided in Section&#160;21.24.2, the <B>"Licensee Infringement/Breach Fee
Maximum Amounts</B>"). For purposes of illustration and without limitation, (i)
in the case of a Licensee Infringing Use involving Marketing Materials, each
Facility located within any geographical region in which or for which such
Marketing Materials are printed, broadcast, displayed or otherwise distributed
and the Internet Store would be considered to be affected by such Licensee
Infringing Use, (ii) in the case of a Licensee Infringing Use involving Disney
Merchandise, each Facility and the Internet Store offering such Disney
Merchandise for sale would be considered to be affected by such Licensee
Infringing Use, (iii) in the case of a Licensee Infringing Use involving
FF&amp;E Materials, each Facility that uses or displays such FF&amp;E Materials
would be considered to be affected by such Licensee Infringing Use, (iv) in the
case of a Royalty Breach, each Facility and the Internet Store would be
considered to be affected by such Royalty Breach, and (v) in the case of a
Material Breach by Licensee of an operating covenant, such as a failure to
maintain or refurbish any Facilities in accordance with the terms of this
Agreement and/or the Operating Manual, each Facility in which such failure
occurs would be considered to be affected by such Material Breach. Any payments
of Licensee Infringement/Breach Fees pursuant to this Section&#160;21.24 shall
be made by Licensee to TDSF on a weekly basis on each Monday in respect of the
seven (7) day period ending on the previous Friday, by wire transfer to the
account designated by TDSF for payment of Licensee Payments under
Section&#160;7. In the event TDSF seeks money damages against Licensee in
connection with any Licensee Infringing Use, Royalty Breach or other Material
Breach by Licensee of this Agreement, the payments made by Licensee under this
Section 21.24 shall be deducted from the amount of any money damages deemed
payable by Licensee to TDSF in connection therewith, <U>provided</U>, that under
no circumstances shall TDSF be required to bring any action against Licensee or
prove any damages in connection with a Licensee Infringing Use, Royalty Breach
or other Material Breach by Licensee of this Agreement in order to obtain the
amounts payable under this Section 21.24 and in no event shall TDSF ever be
required to reimburse any amounts received under this Section 21.24
(<U>i.e.</U>, such as in a case in which the actual amount of money damages
proved in connection with any Licensee Infringing Use, Royalty Breach or other
Material Breach by Licensee of this Agreement is less than the amount paid by
Licensee hereunder in connection with such Licensee Infringing Use, Royalty
Breach or other Material Breach). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.24.2 <U>CPI Adjustments</U>. Beginning effective with the second
(2<FONT SIZE=1>nd</FONT>) Contract Year and continuing through each and every Contract
Year of the Term thereafter, each of the Licensee Infringement/Breach Fee and
the Licensee Infringement/Breach Fee Maximum Amounts for each Contract Year
shall be the Licensee Infringement/Breach Fee and Licensee Infringement/Breach
Fee Maximum Amounts, respectively, for the immediately preceding Contract Year,
as adjusted to reflect the increase, if any, in the CPI in accordance with the
CPI Adjustment Methodology. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.24.3 <U>Expenses</U>. Except as otherwise expressly provided elsewhere in
this Agreement, each party hereto shall be solely responsible for all costs and
expenses arising from the performance of such party&#146;s obligations under
this Agreement, and Licensee shall be solely responsible for all costs and
expenses arising from the operation of the Business, the Facilities, the
Internet Store and all other Business Properties pursuant to Section 9.17.1.
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.24.4 <U>Joint and Several Liability of TDS USA and TDS Canada</U>.
Notwithstanding anything to the contrary contained herein (other than
subparagraph (i) of Section 7.6), TDS USA and TDS Canada shall be jointly and
severally liable for all of the liabilities, duties and obligations of TDS USA,
TDS Canada and/or Licensee hereunder without regard to (i) the party or parties
to whom this Agreement allocates any such liability, duty or obligation, (ii)
the owner, operator or location of any Business Property or (iii) the party or
parties from whose action, omission, breach or violation any such liability,
duty or obligation arises or on whose action, omission, breach or violation any
such liability, duty or obligation is based. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.24.5 <U>Rules of Interpretation</U>. Except as otherwise expressly provided
in this Agreement, the following rules shall apply hereto: (i) the singular
includes the plural and the plural includes the singular; (ii) "or" is not
exclusive, and "include" and "including" are not limiting; (iii) a reference to
any Contract includes any permitted modifications, supplements, amendments and
replacements; (iv) a reference in this Agreement to a section or Schedule is to
the section of or Schedule to this Agreement unless otherwise expressly
provided; (v) a reference to a section or paragraph in this Agreement shall,
unless the context clearly indicates to the contrary, refer to all sub-parts or
sub-components of any said section or paragraph; (vi) words such as "hereunder,"
"hereto," "hereof" and "herein," and other words of like import shall, unless
the context clearly indicates to the contrary, refer to the whole of this
Agreement and not to any particular clause hereof; (vii)&#160;a reference in
this Agreement to a "party" (whether in the singular or the plural) shall
(unless otherwise indicated herein) include both natural persons and entities
(including, without limitation, corporations, partnerships, limited liability
companies, limited liability partnerships, trusts or any other form of legal
entity); (viii)&#160;references herein to "dollars" or "$" shall mean United
States dollars unless otherwise specifically stated; and (ix)&#160;with respect
to any matter requiring the approval or consent of either party hereunder, if no
other standard for granting or denying such approval or consent is provided in
this Agreement, such determination shall be made by the respective party in its
sole discretion. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
21.24.6 <U>Language of the Agreement</U>. At the request of the parties hereto,
this Agreement and all notices related hereto have been drafted in English.
&#192; la requ&#234;te des parties &#224; la pr&#233;sente, cette entente et
tout avis y rapportant ont &#233;t&#233; et seront r&#233;dig&#233;s en langue
anglaise. </FONT></P>

<P ALIGN=CENTER><FONT SIZE=3>[Signatures Appear on Following Page]</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
effective as of the Effective Date by their respective duly authorized
representatives. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>&nbsp;</TD>
<TD WIDTH=50%>
<B>TDSF:</B><BR>
<BR>
TDS FRANCHISING, LLC<BR>
<BR>
<BR>
By: <U> /s/ James M. Kapenstein
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name: <U> James M. Kapenstein
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Title:  Vice President<BR>
<BR>
<BR>
<BR>
By: <U> /s/ David K. Thompson
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name: <U> David K. Thompson
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Title:  Senior Vice President<BR>
<BR>
<BR>
<B>LICENSEE:</B><BR>
<BR>
THE DISNEY STORE, LLC<BR>
<BR>
<BR>
By: <U> /s/ Steven Balasiano
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name: <U>Steven Balasiano
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Title:  Senior Vice President<BR>
<BR>
<BR>
By: <U> /s/ Seth Udasin
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name: <U>  Seth Udasin
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Title:  Treasurer<BR>
<BR>
<BR>
THE DISNEY STORE (CANADA) LTD.<BR>
<BR>
<BR>
By: <U> /s/ Steven Balasiano
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name: <U>Steven Balasiano
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Title: Senior Vice President
</TD>
</TR>
</TABLE>
<BR>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>GUARANTEE BY DISNEY WORLDWIDE SERVICES, INC.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Disney Worldwide Services, Inc., a Florida corporation and a wholly-owned
subsidiary of The Walt Disney Company ("<B>Guarantor</B>"), acknowledges that it
is an Affiliate of TDSF and therefore stands to benefit substantially from the
transactions contemplated by this Agreement. Accordingly, as a material
inducement to Licensee to enter into this Agreement, which Licensee would not
have done in the absence of this guarantee, Guarantor hereby absolutely and
unconditionally guarantees to Licensee the full and timely performance of all of
the obligations of TDSF under the terms and conditions of this Agreement,
including any amendments, modifications, extensions or compromises thereof,
required to be performed by TDSF (collectively, the "<B>Obligations</B>");
<U>provided</U>, that (a) the term "Obligations" as used herein shall not
include obligations under any Contract entered into in connection with this
Agreement but rather shall include only obligations arising under this Agreement
and (b) notwithstanding anything to the contrary contained herein,
Guarantor&#146;s obligations under this guarantee shall at all times be limited
to a maximum aggregate liability amount equal to Thirty-Five Million Dollars
($35,000,000) (the "<B>Maximum Guarantee Liability</B>"). Guarantor acknowledges
and agrees that: (i)&#160;this is a guarantee of payment and performance and not
of collectibility only; (ii)&#160;Guarantor&#146;s responsibility for the
Obligations is in no way conditioned upon any requirement that Licensee first
attempt to collect any of the Obligations from TDSF and, upon demand from
Licensee, the obligations of Guarantor shall become immediately due and payable,
without demand, presentment, protest, notice of acceptance, notice of any
obligations incurred, or any other notices of any kind or nature, each of which
is expressly waived by Guarantor; (iii)&#160;this guarantee shall be binding
upon Guarantor notwithstanding the addition, substitution or release of any
Person primarily or secondarily liable for any Obligation, the bankruptcy,
insolvency or other inability to pay or perform of TDSF, or any other act or
omission that might in any manner or to any extent vary the risk of Guarantor or
otherwise operate as a release or discharge of Guarantor; (iv)&#160;until the
Maximum Guarantee Liability has been satisfied, Guarantor shall not exercise any
rights against TDSF arising as a result of payment by Guarantor hereunder, by
way of subrogation, reimbursement, restitution, setoff, recoupment, counterclaim
or otherwise; (v)&#160;until the Maximum Guarantee Liability has been satisfied,
(a) the payment of any amount due to Guarantor by TDSF is subordinated to the
prior payment in full of all of the Obligations, and (b) any amounts received by
Guarantor in respect thereof while any Obligations are still outstanding shall
be received by Guarantor as trustee for Licensee and shall be promptly paid over
to Licensee; and (vi)&#160;upon demand by Licensee, Guarantor shall pay all
documented out-of-pocket costs and expenses (including court costs and
reasonable legal expenses) reasonably incurred by Licensee in connection with
the enforcement of this guarantee. Guarantor represents and warrants to Licensee
that this guarantee has been duly and validly executed by Guarantor and
constitutes the legally valid and binding obligation of Guarantor, enforceable
against Guarantor in accordance with its terms. Capitalized terms used herein
without definition have the meanings assigned thereto in the Agreement. The
terms of Section 21 of the Agreement, including, without limitation, Section
21.22, are hereby incorporated into this guarantee as if set forth in full
herein, with the exception that references to "TDSF" therein shall be deemed to
be references to "Guarantor" for purposes of this guarantee. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>&nbsp;</TD>
<TD WIDTH=50%>
<B>"Guarantor"</B><BR>
<BR>
Disney Worldwide Services, Inc.,<BR>
a Florida corporation<BR>
<BR>
By: <U> /s/ James M. Kapenstein
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:  James M. Kapenstein<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President
</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><FONT SIZE=3><B>TABLE OF CONTENTS</B></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80%></TD>
<TD WIDTH=20%><U>Page</U></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>1.</TD>
<TD WIDTH=75%>DEFINITIONS</TD>
<TD WIDTH=20%>1</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>2.</TD>
<TD WIDTH=75%>TERM OF AGREEMENT</TD>
<TD WIDTH=20%>43</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>2.1<BR>
2.2</TD>
<TD WIDTH=65%>Initial Term<BR>
Renewal Terms</TD>
<TD WIDTH=20%>43<BR>
44</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>2.2.1<BR>
2.2.2</TD>
<TD WIDTH=55%>Conditional Renewal Terms<BR>
Negotiated Renewal Terms</TD>
<TD WIDTH=20%>44<BR>
46</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>3.</TD>
<TD WIDTH=75%>TERRITORY</TD>
<TD WIDTH=20%>46</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>3.1<BR>
3.2</TD>
<TD WIDTH=65%>Definition of Territory<BR>
Rights of Negotiation Regarding Central America, South America and<BR>
China</TD>
<TD WIDTH=20%>46<BR>
<BR>47</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>4.</TD>
<TD WIDTH=75%>LICENSE</TD>
<TD WIDTH=20%>48</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>4.1<BR>
4.2<BR>
4.3<BR>
4.4</TD>
<TD WIDTH=65%>Grant of License<BR>
Exclusions; Reservation of Rights<BR>
Limitations<BR>
Ownership of Licensed Materials and Trademarks</TD>
<TD WIDTH=20%>48<BR>
49<BR>
49<BR>
51</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>4.4.1<BR>
4.4.2</TD>
<TD WIDTH=55%>Ownership<BR>
Registration</TD>
<TD WIDTH=20%>51<BR>
51</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>4.5<BR>
4.6<BR>
4.7<BR>
4.8</TD>
<TD WIDTH=65%>Copyrights<BR>
No Rights in Music<BR>
Film Clips<BR>
Infringement; Legal Actions</TD>
<TD WIDTH=20%>52<BR>
53<BR>
53<BR>
53</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>4.8.1<BR>
4.8.2<BR>
4.8.3<BR>
4.8.4</TD>
<TD WIDTH=55%>Notice<BR>
Control of Disney IP Claims Involving Licensee; Costs<BR>
Cooperation<BR>
No Right to Proceeds</TD>
<TD WIDTH=20%>53<BR>
53<BR>
54<BR>
54</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>4.9<BR>
4.10<BR>
4.11<BR>
4.12</TD>
<TD WIDTH=65%>Withdrawal of Licensed Materials<BR>
Limitations on Licensee's Uses<BR>
Disney Character Appearances<BR>
Certain Obligations to Third Parties</TD>
<TD WIDTH=20%>54<BR>
56<BR>
57<BR>
58</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>5.</TD>
<TD WIDTH=75%>TDSF'S APPROVAL PROCEDURES</TD>
<TD WIDTH=20%>58</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>5.1</TD>
<TD WIDTH=65%>Disney Merchandise Approvals</TD>
<TD WIDTH=20%>58</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>5.1.1<BR>
5.1.2<BR>
5.1.3<BR>
5.1.4</TD>
<TD WIDTH=55%>Approval of Conceptual Materials and Pre-Production Samples<BR>
Approval of Production Samples<BR>
General Matters Regarding Disney Merchandise Approvals<BR>
Manufacturing/Sourcing</TD>
<TD WIDTH=20%>59<BR>
60<BR>
61<BR>
64</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)<BR>
(d)<BR>
(e)<BR>
(f)</TD>
<TD WIDTH=50%>International Labor Standards ("ILS"); Compliance<BR>
Product Safety<BR>
Approval of Manufacturers<BR>
Name and Address of Licensee<BR>
Unauthorized Activities<BR>
Potential Internal Audit Compliance Team and Product<BR>
Safety Laboratory</TD>
<TD WIDTH=20%>64<BR>
65<BR>
66<BR>
67<BR>
67<BR>
<BR>
67</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>5.2</TD>
<TD WIDTH=65%>FF&amp;E Materials and Marketing Materials Approvals</TD>
<TD WIDTH=20%>68</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>5.2.1 <BR>
5.2.2 <BR>
5.2.3 <BR>
5.2.4 <BR>
5.2.5 <BR>
5.2.6 <BR>
5.2.7 <BR>
5.2.8 </TD>
<TD WIDTH=55%>Original Submissions<BR>
Preliminary Approval<BR>
Final Proofs<BR>
Final Approval<BR>
Print, Radio and Television<BR>
FF&amp;E Materials<BR>
Promotional Brief<BR>
** (<I>This information is confidential and has been omitted and separately filed
with the Securities and Exchange Commission</I>)</TD>
<TD WIDTH=20%>68<BR>
69<BR>
70<BR>
71<BR>
71<BR>
71<BR>
72<BR>
72
</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>5.3<BR>
5.4<BR>
5.5<BR>
5.6<BR>
5.7<BR>
5.8</TD>
<TD WIDTH=65%>General Terms Applicable to TDSF Approval of All Licensed Materials<BR>
Unique Nature of Agreement<BR>
Quality Control<BR>
Other Limitations<BR>
Exceptions<BR>
Business Stationery and Related Materials</TD>
<TD WIDTH=20%>73<BR>
73<BR>
74<BR>
74<BR>
75<BR>
75</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>6.</TD>
<TD WIDTH=75%>PRESERVATION OF PROMOTIONAL VALUE</TD>
<TD WIDTH=20%>75</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>6.1</TD>
<TD WIDTH=65%>Preservation of Licensee's Promotional Value</TD>
<TD WIDTH=20%>75</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>6.1.1<BR>
6.1.2<BR>
6.1.3<BR>
6.1.4<BR>
6.1.5<BR>
6.1.6<BR>
6.1.7</TD>
<TD WIDTH=55%>Flagship Stores, Designated WDW Stores and El Capitan<BR>
Disney Retained Stores<BR>
Other Disney Retail Stores<BR>
Outlet Stores<BR>
Direct-to-Consumer<BR>
Temporary Liquidation Stores<BR>
Existing Authorizations to Use Restricted Names</TD>
<TD WIDTH=20%>76<BR>
77<BR>
77<BR>
78<BR>
78<BR>
79<BR>
79</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>6.2<BR>
6.3<BR>
6.4</TD>
<TD WIDTH=65%>Other Channels of Distribution Not Limited<BR>
Preservation of TDSF's Promotional Value<BR>
Right of First Negotiation With Respect to NDB Stores</TD>
<TD WIDTH=20%>80<BR>
85<BR>
86</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>7.</TD>
<TD WIDTH=75%>ROYALTIES</TD>
<TD WIDTH=20%>87</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>7.1</TD>
<TD WIDTH=65%>Payments</TD>
<TD WIDTH=20%>87</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>7.1.1<BR>
7.1.2<BR>
7.1.3</TD>
<TD WIDTH=55%>Monthly Royalties<BR>
Royalty for Non-Core Stores<BR>
Facilities Royalty Abatement</TD>
<TD WIDTH=20%>87<BR>
88<BR>
89</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>7.2<BR>
7.3<BR>
7.4<BR>
7.5<BR>
7.6<BR>
7.7<BR>
7.8<BR>
7.9</TD>
<TD WIDTH=65%>Guarantee<BR>
Manner of Payments<BR>
US Dollars; Exchange Rates<BR>
Termination of Agreement<BR>
TDS Canada and Canadian Royalties<BR>
TDS USA Royalties<BR>
Use of Payments<BR>
No Third Party Royalty Payments</TD>
<TD WIDTH=20%>89<BR>
90<BR>
90<BR>
90<BR>
90<BR>
91<BR>
91<BR>
91</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>8.</TD>
<TD WIDTH=75%>OVERSIGHT OF RELATIONSHIP</TD>
<TD WIDTH=20%>91</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>8.1<BR>
8.2<BR>
8.3</TD>
<TD WIDTH=65%>TDSF Advisors<BR>
Licensee Advisors<BR>
Joint Advisory Committee</TD>
<TD WIDTH=20%>91<BR>
92<BR>
92</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>9.</TD>
<TD WIDTH=75%>OPERATION OF THE FACILITIES AND THE INTERNET STORE</TD>
<TD WIDTH=20%>94</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.1</TD>
<TD WIDTH=65%>General Operating Standards</TD>
<TD WIDTH=20%>94</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.1.1<BR>
9.1.2<BR>
9.1.3<BR>
9.1.4</TD>
<TD WIDTH=55%>Operation Through Facilities and Internet Store<BR>
Maximizing Value of the Business<BR>
Operation By Licensee<BR>
No Other Operations</TD>
<TD WIDTH=20%>94<BR>
94<BR>
95<BR>
95</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.2<BR>
9.3</TD>
<TD WIDTH=65%>Annual Business Plans<BR>
Opening and Closing Business Properties; Maintenance and
<BR>Refurbishment of Facilities</TD>
<TD WIDTH=20%>95<BR>
<BR>
96</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.3.1</TD>
<TD WIDTH=55%>Initial Facilities; Opening and Closing Facilities</TD>
<TD WIDTH=20%>96</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)</TD>
<TD WIDTH=50%>Permitted Openings<BR>
Permitted Closings<BR>
Restrictions on Permitted Openings and Permitted<BR>
Closings</TD>
<TD WIDTH=20%>96<BR>
97<BR>
<BR>
97</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.3.2</TD>
<TD WIDTH=55%>Outlet Facilities; Internet Store; Other Operations</TD>
<TD WIDTH=20%>98</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)</TD>
<TD WIDTH=50%>Outlet Facilities<BR>
Internet Store<BR>
Distribution Centers</TD>
<TD WIDTH=20%>98<BR>
98<BR>
102</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.3.3<BR>
9.3.4<BR>
9.3.5</TD>
<TD WIDTH=55%>Additional Restrictions on Opening Facilities<BR>
Additional Restrictions on Closings<BR>
Maintenance and Refurbishment</TD>
<TD WIDTH=20%>102<BR>
102<BR>
103</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)</TD>
<TD WIDTH=50%>Maintenance<BR>
Facility Refurbishment</TD>
<TD WIDTH=20%>103<BR>
103</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.3.6</TD>
<TD WIDTH=55%>Look and Feel</TD>
<TD WIDTH=20%>104</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.3.7</TD>
<TD WIDTH=55%>Days and Hours</TD>
<TD WIDTH=20%>104</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.4</TD>
<TD WIDTH=65%>Staffing</TD>
<TD WIDTH=20%>105</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.4.1<BR>
9.4.2<BR>
9.4.3<BR>
9.4.4<BR>
9.4.5</TD>
<TD WIDTH=55%>General Staffing Matters<BR>
Employee Compensation and Benefits<BR>
Employee Discounts<BR>
Management Team<BR>
Severance and Other Employee Benefits</TD>
<TD WIDTH=20%>105<BR>
106<BR>
107<BR>
107<BR>
107</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.5<BR>
9.6</TD>
<TD WIDTH=65%>Customer Service; Product Returns<BR>
Disney Merchandise</TD>
<TD WIDTH=20%>108<BR>
108</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.6.1<BR>
9.6.2<BR>
9.6.3</TD>
<TD WIDTH=55%>General Merchandise Management<BR>
Disney Dollars<BR>
Merchandise Sharing Obligations</TD>
<TD WIDTH=20%>108<BR>
109<BR>
110</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)</TD>
<TD WIDTH=50%>Obligations of Licensee</TD>
<TD WIDTH=20%>110</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.6.4<BR>
9.6.5<BR>
9.6.6</TD>
<TD WIDTH=55%>Product Warranties<BR>
Purchase of Home Entertainment Products<BR>
Disposition of Defective Merchandise</TD>
<TD WIDTH=20%>112<BR>
112<BR>
113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.7</TD>
<TD WIDTH=65%>Covenants Relating to Real Property</TD>
<TD WIDTH=20%>113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.7.1</TD>
<TD WIDTH=55%>Conduct Relating to Leased Property</TD>
<TD WIDTH=20%>113</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)<BR>
(d)<BR>
<BR>
(e)<BR>
<BR>
(f)<BR>
(g)<BR>
<BR>(h)<BR>
(i)<BR>
(j)<BR>
(k)<BR>
(l)<BR>
<BR>
(m)</TD>
<TD WIDTH=50%>Obligations Under Leases<BR>
Notices With Respect to Leased Properties<BR>
Insurance With Respect to Leased Properties<BR>
Environmental Matters With Respect to Leased<BR>
Properties<BR>
Notification and Summary of Proposed Lease
<BR>Agreements<BR>
Limited Termination Rights of Licensee<BR>
TDSF Termination Rights With Respect to Disney-<BR>
Guaranteed Leases<BR>
Expiring Disney-Guaranteed Leases<BR>
Acquisition of Lease Agreements from Bankruptcy<BR>
Assignment and Subletting<BR>
Limitations on Short-Term Leases<BR>
No Licensee Parent or Canadian Parent
<BR>Guarantees<BR>
Delivery of Executed Lease Agreements</TD>
<TD WIDTH=20%>113<BR>
113<BR>
114<BR>
<BR>114<BR>
<BR>114<BR>
115<BR>
<BR>
115<BR>
115<BR>
116<BR>
116<BR>
116<BR>
<BR>
116<BR>
117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.7.2</TD>
<TD WIDTH=55%>Conduct Relating to Other Real Property</TD>
<TD WIDTH=20%>117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)<BR>
<BR>
(d)</TD>
<TD WIDTH=50%>Notices and Correspondence<BR>
Insurance With Respect to Other Real Property<BR>
Environmental Matters With Respect to Other Real<BR>
Property<BR>
Transfers</TD>
<TD WIDTH=20%>117<BR>
117<BR>
117<BR>
<BR>
117</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.8</TD>
<TD WIDTH=65%>Strategic Alliances</TD>
<TD WIDTH=20%>118</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.8.1<BR>
9.8.2</TD>
<TD WIDTH=55%>General<BR>
** (<I>This information is confidential and has been omitted and separately filed
with the Securities and Exchange Commission</I>)</TD>
<TD WIDTH=20%>118<BR>
118
</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.8.3</TD>
<TD WIDTH=55%>** (<I>This information is confidential and has been omitted and separately filed
with the Securities and Exchange Commission</I>)</TD>
<TD WIDTH=20%>123</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.8.4<BR>
9.8.5<BR>
9.8.6</TD>
<TD WIDTH=55%>Other Disney Cards and Non-US Strategic Alliances<BR>
Other Strategic Alliance Arrangements<BR>
Introductions to Strategic Alliance Parties</TD>
<TD WIDTH=20%>124<BR>
125<BR>
126</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.9</TD>
<TD WIDTH=65%>Synergy Rights and Obligations</TD>
<TD WIDTH=20%>126</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.9.1<BR>
9.9.2<BR>
9.9.3<BR>
<BR>
9.9.4<BR>
9.9.5<BR>
<BR>
9.9.6<BR>
9.9.7</TD>
<TD WIDTH=55%>Theme Park Admissions<BR>
Required Product<BR>
Advance Preview of Motion Picture Properties and Television<BR>
Properties<BR>
Coupons of TDSF and its Affiliates<BR>
Acceptance of Returned Merchandise From the Other Party's<BR>
Stores<BR>
No Limitation on Premiums by Third Parties<BR>
Requests for Assistance; Access to Archives</TD>
<TD WIDTH=20%>126<BR>
126<BR>
<BR>
127<BR>
128<BR>
<BR>
128<BR>
129<BR>
129</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.9.8 <BR>
9.9.9 <BR>
9.9.10<BR>
9.9.11<BR>
9.9.12</TD>
<TD WIDTH=55%>Cross-Marketing Opportunities<BR>
Volume Discounts<BR>
Reciprocal Benefits for Employees<BR>
Disney Gift Cards and Stored Value Cards<BR>
TDSF Reproduction Rights</TD>
<TD WIDTH=20%>130<BR>
130<BR>
131<BR>
132<BR>
133</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.10</TD>
<TD WIDTH=65%>Access and Right to Cure</TD>
<TD WIDTH=20%>134</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.10.1<BR>
9.10.2<BR>
9.10.3</TD>
<TD WIDTH=55%>Monitoring and Inspection<BR>
TDSF Self-Help Cure<BR>
TDSF Self-Help Fund</TD>
<TD WIDTH=20%>134<BR>
134<BR>
135</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)</TD>
<TD WIDTH=50%>Funding<BR>
Use of Fund<BR>
TDSF Self-Help Fund Amount and Adjustments</TD>
<TD WIDTH=20%>135<BR>
136<BR>
136</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.11</TD>
<TD WIDTH=65%>Reporting Obligations</TD>
<TD WIDTH=20%>136</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.11.1<BR>
9.11.2<BR>
9.11.3<BR>
9.11.4<BR>
9.11.5<BR>
9.11.6<BR>
9.11.7<BR>
9.11.8</TD>
<TD WIDTH=55%>Monthly Sales and Operating Statements<BR>
Quarterly Financial Information<BR>
Annual Financial Information<BR>
Liquidity Plan<BR>
Tax Returns<BR>
SEC Filings<BR>
Other Information<BR>
Form of Delivery</TD>
<TD WIDTH=20%>136<BR>
137<BR>
137<BR>
138<BR>
138<BR>
139<BR>
139<BR>
139</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.12</TD>
<TD WIDTH=65%>Organizational Structure</TD>
<TD WIDTH=20%>139</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.12.1<BR>
9.12.2<BR>
9.12.3</TD>
<TD WIDTH=55%>Maintenance of Corporate Organization<BR>
Transactions with TCP or its Affiliates<BR>
Distinct Public Name of Licensee Entities</TD>
<TD WIDTH=20%>139<BR>
142<BR>
143</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.13</TD>
<TD WIDTH=65%>Governance</TD>
<TD WIDTH=20%>143</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.13.1<BR>
9.13.2<BR>
9.13.3<BR>
9.13.4<BR>
<BR>
9.13.5</TD>
<TD WIDTH=55%>Board Observation Rights at Licensee/TCP Entities<BR>
Independent Directors at Licensee Entities<BR>
Major Decisions Requiring Approval of Independent Directors<BR>
Decisions Requiring the Approval of Only the Independent
<BR>Directors<BR>
Incorporation into Governing Documents</TD>
<TD WIDTH=20%>143<BR>
144<BR>
145<BR>
<BR>
148<BR>
149</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.14<BR>
9.15</TD>
<TD WIDTH=65%>Auditors<BR>
Affiliate Transactions</TD>
<TD WIDTH=20%>149<BR>
149</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.15.1<BR>
9.15.2</TD>
<TD WIDTH=55%>Intercompany Agreements<BR>
Other Transactions with Affiliates</TD>
<TD WIDTH=20%>149<BR>
149</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.16<BR>
9.17</TD>
<TD WIDTH=65%>Permits and Compliance With Law<BR>
Funding of Business</TD>
<TD WIDTH=20%>150<BR>
150</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.17.1<BR>
9.17.2<BR>
9.17.3</TD>
<TD WIDTH=55%>Operating Costs<BR>
Indebtedness of Licensee and its Subsidiaries<BR>
Indebtedness of Licensee Parent and Canadian Parent</TD>
<TD WIDTH=20%>150<BR>
150<BR>
153</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>9.18<BR>
9.19</TD>
<TD WIDTH=65%>Operating Manual<BR>
Operational Approval Procedures</TD>
<TD WIDTH=20%>153<BR>
154</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.19.1</TD>
<TD WIDTH=55%>Approving Openings and Closings of Business Properties</TD>
<TD WIDTH=20%>154</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)</TD>
<TD WIDTH=50%>Submissions<BR>
Approval or Disapproval<BR>
Modification of Opening/Closing Proposal;<BR>
Postponement or Revocation of
Approval</TD>
<TD WIDTH=20%>154<BR>
154<BR>
<BR>
155</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.19.2</TD>
<TD WIDTH=55%>Approving Facility Design Elements, New Store Construction and
<BR>Refurbishments</TD>
<TD WIDTH=20%><BR>
155</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)<BR>
<BR>
(d)<BR>
(e)</TD>
<TD WIDTH=50%>Submissions<BR>
Approval<BR>
Modification of Design Proposal; Postponement or<BR>
Revocation of Approval<BR>
Expedited Facility Design Element Approval Process<BR>
Refurbishment Costs</TD>
<TD WIDTH=20%>155<BR>
156<BR>
<BR>
156<BR>
156<BR>
157</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.19.3</TD>
<TD WIDTH=55%>Other Operational Approvals</TD>
<TD WIDTH=20%>157</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)</TD>
<TD WIDTH=50%>Submissions<BR>
Approval<BR>
Modification of Approval Item Proposal; Postponement<BR>
or Revocation of
Approval</TD>
<TD WIDTH=20%>158<BR>
158<BR>
<BR>
158</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.19.4</TD>
<TD WIDTH=55%>Mandatory Provisions in New Business Property Lease<BR>
Agreements and
Lease Extension Arrangements</TD>
<TD WIDTH=20%><BR>
159</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25%></TD>
<TD WIDTH=5%>(a)<BR>
(b)<BR>
(c)<BR>
(d)</TD>
<TD WIDTH=50%>Acknowledgment of No Obligation by TDSF<BR>
TDSF's Right to Enter and Occupy Facility<BR>
TDSF's Right to Cure Default<BR>
TDSF's Right to Transfer Upon License Termination</TD>
<TD WIDTH=20%>159<BR>
159<BR>
159<BR>
159</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>9.19.5</TD>
<TD WIDTH=55%>General Terms Applicable to TDSF Approval of All<BR>
Operational Submissions</TD>
<TD WIDTH=20%><BR>
160</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>10.</TD>
<TD WIDTH=75%>CUSTOMER DATA</TD>
<TD WIDTH=20%>160</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>10.1<BR>
10.2</TD>
<TD WIDTH=65%>Definition of Customer Data<BR>
Ownership and Use of Customer Data</TD>
<TD WIDTH=20%>160<BR>
161</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>10.2.1<BR>
10.2.2<BR>
10.2.3</TD>
<TD WIDTH=55%>During the Term<BR>
Following Expiration or Termination<BR>
Data Obtained Independently by TDSF</TD>
<TD WIDTH=20%>161<BR>
161<BR>
162</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>10.3<BR>
10.4</TD>
<TD WIDTH=65%>Provision of Information by Licensee to TDSF<BR>
Approval of Direct Marketing Activities</TD>
<TD WIDTH=20%>162<BR>
162</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>11.</TD>
<TD WIDTH=75%>OWNERSHIP OF CERTAIN TECHNOLOGY AND PRODUCT DESIGN<BR>
ELEMENTS</TD>
<TD WIDTH=20%><BR>
162</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>11.1<BR>
11.2<BR>
11.3<BR>
11.4<BR>
11.5</TD>
<TD WIDTH=65%>Definitions<BR>
Non-Disney Technology and Elements Ownership and License Rights<BR>
Product Trademark Ownership<BR>
Further Assurances<BR>
Survival of Section</TD>
<TD WIDTH=20%>162<BR>
163<BR>
165<BR>
165<BR>
165</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>12.</TD>
<TD WIDTH=75%>INDEMNIFICATION</TD>
<TD WIDTH=20%>165</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>12.1<BR>
12.2<BR>
12.3<BR>
12.4</TD>
<TD WIDTH=65%>Indemnification by Licensee<BR>
Indemnification by TDSF<BR>
Procedures of Indemnification<BR>
Survival</TD>
<TD WIDTH=20%>165<BR>
167<BR>
168<BR>
169</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>13.</TD>
<TD WIDTH=75%>TERMINATION BY TDSF</TD>
<TD WIDTH=20%>169</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>13.1 <BR>
13.2 <BR>
13.3 <BR>
13.4 <BR>
13.5 <BR>
13.6 <BR>
13.7 <BR>
13.8 <BR>
13.9 <BR>
13.10<BR>
13.11<BR>
13.12<BR>
13.13<BR>
13.14<BR>
13.15</TD>
<TD WIDTH=65%>Royalty Breach<BR>
Misuse of Licensed Materials<BR>
Material Breach<BR>
Assignment<BR>
Change of Control<BR>
Insolvency<BR>
Reputational Decline<BR>
Material Breach or Termination of TCP Guaranty and Commitment<BR>
Breach of Certain Representations, Warranties and Covenants<BR>
Uncured Material Breach of Certain Covenants<BR>
Defaults under Indebtedness<BR>
Judgments<BR>
Uninsured Losses<BR>
Breaches of Material Contracts<BR>
Other Termination Rights</TD>
<TD WIDTH=20%>169<BR>
169<BR>
169<BR>
170<BR>
170<BR>
171<BR>
171<BR>
172<BR>
172<BR>
172<BR>
172<BR>
173<BR>
173<BR>
174<BR>
174</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>14.</TD>
<TD WIDTH=75%>TERMINATION BY LICENSEE</TD>
<TD WIDTH=20%>174</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>14.1<BR>
14.2<BR>
14.3<BR>
14.4</TD>
<TD WIDTH=65%>Material Breach<BR>
Withdrawn or Retired Character Properties<BR>
Loss of Use of "<I>Disney</I>" Name<BR>
Uncured Material Breach of Certain Covenants</TD>
<TD WIDTH=20%>174<BR>
174<BR>
174<BR>
174</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>15.</TD>
<TD WIDTH=75%>PURCHASE OF FACILITIES UPON TERMINATION</TD>
<TD WIDTH=20%>175</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>15.1</TD>
<TD WIDTH=65%>Right to Purchase or Cause Purchase of Facilities; Notice Dates;<BR>
Commencement of Purchase Process</TD>
<TD WIDTH=20%><BR>
175</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>15.1.1<BR>
15.1.2<BR>
15.1.3<BR>
15.1.4</TD>
<TD WIDTH=55%>Right to Purchase<BR>
No Obligation to Purchase<BR>
Notice of Exercise of Right<BR>
Commencement of Purchase Process</TD>
<TD WIDTH=20%>175<BR>
175<BR>
176<BR>
176</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>15.2</TD>
<TD WIDTH=65%>Appraisal and Bidding Process; Determination of Compensation</TD>
<TD WIDTH=20%>176</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>15.2.1<BR>
15.2.2<BR>
15.2.3</TD>
<TD WIDTH=55%>Appraisal of Business<BR>
Bidding Process<BR>
Compensation for Designated Facilities</TD>
<TD WIDTH=20%>176<BR>
178<BR>
179</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>15.3</TD>
<TD WIDTH=65%>Purchase Mechanics</TD>
<TD WIDTH=20%>181</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>16.</TD>
<TD WIDTH=75%>EFFECT OF EXPIRATION OR TERMINATION OF THIS AGREEMENT</TD>
<TD WIDTH=20%>182</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>16.1<BR>
16.2<BR>
16.3<BR>
16.4<BR>
<BR>
16.5</TD>
<TD WIDTH=65%>Expiration<BR>
Early Termination<BR> Survival of Certain Provisions<BR> Certain Rights of
Licensee Regarding Inventory Liquidation Upon
<BR>Expiration or Termination<BR>
Certain Rights of Secured Lender Regarding Inventory Liquidation Upon
<BR>Event of Default</TD>
<TD WIDTH=20%>182<BR>
182<BR>
183<BR>
<BR>
183<BR>
<BR>
184</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>17.</TD>
<TD WIDTH=75%>PUBLIC DISCLOSURE; CONFIDENTIALITY</TD>
<TD WIDTH=20%>185</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>17.1<BR>
17.2<BR>
17.3</TD>
<TD WIDTH=65%>Public Disclosure<BR>
Confidentiality<BR>
Survival of Section</TD>
<TD WIDTH=20%>185<BR>
186<BR>
187</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>18.</TD>
<TD WIDTH=75%>REPRESENTATIONS, WARRANTIES AND COVENANTS OF LICENSEE</TD>
<TD WIDTH=20%>187</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>18.1<BR>
18.2<BR>
18.3<BR>
18.4<BR>
18.5<BR>
18.6<BR>
18.7<BR>
18.8</TD>
<TD WIDTH=65%>Organization, Standing and Authority; Capitalization<BR>
Authorization and Binding Obligation<BR>
Absence of Conflicting Agreements<BR>
Claims; Legal Actions<BR>
Full Disclosure<BR>
No Reliance<BR>
No Broker Fees<BR>
Survival</TD>
<TD WIDTH=20%>187<BR>
188<BR>
188<BR>
188<BR>
188<BR>
188<BR>
188<BR>
189</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>19.</TD>
<TD WIDTH=75%>REPRESENTATIONS, WARRANTIES AND COVENANTS OF TDSF</TD>
<TD WIDTH=20%>189</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>19.1<BR>
19.2<BR>
19.3<BR>
19.4<BR>
19.5<BR>
19.6<BR>
19.7<BR>
19.8</TD>
<TD WIDTH=65%>Organization, Standing and Authority; Rights in Disney Properties<BR>
Authorization and Binding Obligation<BR>
Absence of Conflicting Agreements<BR>
Claims; Legal Actions<BR>
Full Disclosure<BR>
No Reliance<BR>
No Broker Fees<BR>
Survival</TD>
<TD WIDTH=20%>189<BR>
189<BR>
189<BR>
190<BR>
190<BR>
190<BR>
190<BR>
190</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>20.</TD>
<TD WIDTH=75%>COMPLIMENTARY BENEFITS</TD>
<TD WIDTH=20%>190</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>21.</TD>
<TD WIDTH=75%>MISCELLANEOUS</TD>
<TD WIDTH=20%>191</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>21.1</TD>
<TD WIDTH=65%>Books and Records</TD>
<TD WIDTH=20%>191</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>21.1.1<BR>
21.1.2</TD>
<TD WIDTH=55%>Right of Audit<BR>
Underpayment or Overpayment Remedies</TD>
<TD WIDTH=20%>191<BR>
192</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>21.2 <BR>
21.3 <BR>
21.4 <BR>
21.5 <BR>
21.6 <BR>
21.7 <BR>
21.8 <BR>
21.9 <BR>
21.10<BR>
21.11<BR>
21.12<BR>
21.13<BR>
21.14<BR>
21.15<BR>
21.16<BR>
21.17<BR>
21.18<BR>
21.19<BR>
21.20<BR>
21.21<BR>
21.22<BR>
21.23</TD>
<TD WIDTH=65%>Insurance<BR>
Force Majeure<BR>
Waivers<BR>
Notices<BR>
Entire Agreement<BR>
Joint Venture/Partnership Disclaimer<BR>
Accord and Satisfaction<BR>
Relationship of Parties<BR>
Effect of Headings<BR>
Construction<BR>
Non-Assignment by Licensee<BR>
Severability<BR>
Amendments<BR>
Counterparts; Facsimile Signatures<BR>
Schedules<BR>
No Third Party Beneficiaries<BR>
Further Assurances<BR>
Conflicts of Interest<BR>
Interest<BR>
Governing Law; Remedies<BR>
Limitation of Liability<BR>
Arbitration Procedures</TD>
<TD WIDTH=20%>192<BR>
193<BR>
194<BR>
194<BR>
195<BR>
195<BR>
196<BR>
196<BR>
196<BR>
196<BR>
196<BR>
197<BR>
197<BR>
197<BR>
197<BR>
197<BR>
197<BR>
197<BR>
197<BR>
198<BR>
199<BR>
199</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>21.23.1 <BR>
21.23.2 <BR>
21.23.3 <BR>
21.23.4 <BR>
21.23.5 <BR>
21.23.6 <BR>
21.23.7 <BR>
21.23.8 <BR>
<BR>
21.23.9 <BR>
21.23.10<BR>
21.23.11<BR>
21.23.12<BR>
21.23.13<BR>
21.23.14<BR>
21.23.15<BR>
21.23.16<BR>
21.23.17<BR>
21.23.18</TD>
<TD WIDTH=55%>Management Negotiations<BR>
Arbitrable Disputes<BR>
Applicability of California Procedural Law<BR>
Arbitration Complaints and Notices<BR>
Selection of Arbitrator and Appellate Arbitrators<BR>
Arbitrator Neutrality<BR>
Emergency Relief<BR>
Arbitration Hearing/Arbitrator's Rulings, Statement of
<BR>Decision and Judgment<BR>
Appeal<BR>
Jurisdiction/Venue/Enforcement of Award<BR>
Discovery<BR>
Res Judicata, Collateral Estoppel and Law of the Case<BR>
Confidential Proceedings<BR>
Arbitrator Fees and Arbitration Costs<BR>
Non-Signatory Legal Actions<BR>
Expedited Procedures<BR>
No Declaratory Relief<BR>
Survivability</TD>
<TD WIDTH=20%>199<BR>
200<BR>
200<BR>
200<BR>
201<BR>
202<BR>
202<BR>
<BR>
202<BR>
203<BR>
203<BR>
203<BR>
204<BR>
204<BR>
204<BR>
204<BR>
204<BR>
205<BR>
205</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>21.24</TD>
<TD WIDTH=65%>Certain Licensee Fees</TD>
<TD WIDTH=20%>205</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15%></TD>
<TD WIDTH=10%>21.24.1<BR>
21.24.2</TD>
<TD WIDTH=55%>General<BR>
CPI Adjustments</TD>
<TD WIDTH=20%>205<BR>
206</TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=10%>21.25<BR>
21.26<BR>
21.27</TD>
<TD WIDTH=65%>Expenses<BR>
Joint and Several Liability of TDS USA and TDS Canada<BR>
Rules of Interpretation</TD>
<TD WIDTH=20%>206<BR>
206<BR>
207</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80%>&nbsp;<BR>
Schedule 1(a)  Financial Covenant of Licensee<BR>
<BR>
Schedule 1(b)   Animated Characters<BR>
<BR>
Schedule 1(c)   DTR Product Categories<BR>
<BR>
Schedule 1(d)   Hardlines<BR>
<BR>
Schedule 1(e)   Non-Disney-Branded Properties<BR>
<BR>
Schedule 1(f)  Softlines<BR>
<BR>
Schedule 1(g)  Form of TCP Intercompany Services Agreement<BR>
<BR>
Schedule 1(h)  Toys/Plush<BR>
<BR>
Schedule 5.1.4(a-1)  Manufacturer's Agreement<BR>
<BR>
Schedule 5.1.4(a-2)  Form of Manufacturer's MOU<BR>
<BR>
Schedule 5.1.4(a-3)  Form of Manufacturer's FAMA<BR>
<BR>
Schedule 5.2.1  Form of Promotional Brief<BR>
<BR>
Schedule 6.1.7  Existing Restricted Name Agreements<BR>
<BR>
Schedule 6.2.1  License Encumbrance Agreements<BR>
<BR>
Schedule 6.2.4   Existing DTR Licenses<BR>
<BR>
Schedule 9.3.1  Initial Facilities<BR>
<BR>
Schedule 9.7.1(e)  Form of Proposed Lease Agreement Notice<BR>
<BR>
Schedule 9.9.1  Theme Park Admission Passes<BR>
<BR>
Schedule 9.10.3(a)   Form of Escrow Agreement<BR>
<BR>
Schedule A  Fee Schedule<BR>
<BR>
Schedule 9.12.1(a)   Form of Canadian Joinder</TD>
<TD WIDTH=20%>210<BR>
<BR>
212<BR>
<BR>
215<BR>
<BR>
216<BR>
<BR>
217<BR>
<BR>
218<BR>
<BR>
219<BR>
<BR>
220<BR>
<BR>
221<BR>
<BR>
226<BR>
<BR>
239<BR>
<BR>
241<BR>
<BR>
243<BR>
<BR>
244<BR>
<BR>
245<BR>
<BR>
246<BR>
<BR>
247<BR>
<BR>
249<BR>
<BR>
258<BR>
<BR>
266<BR>
<BR>
267</TD>
</TR>
</TABLE>
<BR>


</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>5
<FILENAME>childrens-ex105_120904.htm
<DESCRIPTION>EX-10.5
<TEXT>
<HTML>
<HEAD>
<TITLE>Exhibit 10.5</TITLE>
</HEAD>
<BODY>

<P ALIGN=CENTER><FONT SIZE=3><B>GUARANTY AND COMMITMENT</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>THIS
GUARANTY AND COMMITMENT </B>(as amended and in effect from time to time, this
&#147;<B>Guaranty and</B> <B>Commitment&#148;</B>) dated as of November 21, 2004
is made jointly and severally by The Children&#146;s Place Retail Stores, Inc.,
a Delaware corporation (&#147;<B>TCP</B>&#148;), and Hoop Holdings, LLC, a
Delaware limited liability company (&#147;<B>Licensee Parent</B>&#148; and,
together with TCP, each an &#147;<B>Obligor</B>&#148; and collectively, the
&#147;<B>Obligors</B>&#148;), in favor of The Disney Store, LLC, a California
limited liability company (&#147;<B>TDS USA</B>&#148;), The Disney Store
(Canada) Ltd., a corporation incorporated under the laws of the Province of
Ontario (&#147;<B>TDS Canada</B>&#148; and, together with TDS USA,
&#147;<B>Licensee</B>&#148;),<B> </B>and TDS Franchising, LLC, a California
limited liability company (&#147;<B>TDSF</B>&#148;). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS, pursuant to an Acquisition Agreement, dated as of October 19, 2004 (as
amended and in effect from time to time, the &#147;<B>Acquisition
Agreement</B>&#148;), by and among Disney Enterprises, Inc., a Delaware
corporation <B>(&#147;DEI</B>&#148;), Disney Credit Card Services, Inc., a
California corporation (&#147;<B>DCCS</B>&#148; and, together with DEI, the
<B>&#147;Sellers&#148;</B>), Licensee Parent and Hoop Canada Holdings, Inc., a
Delaware corporation (&#147;<B>Canadian Parent</B>&#148;) (together with a
guarantee of the obligations of Licensee Parent and Canadian Parent thereunder
by TCP), on the date hereof, Licensee Parent is acquiring all of the equity
interests of TDS USA and Canadian Parent is acquiring all of the equity
interests of TDS Canada; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
Licensee is the tenant under certain leases and the owner, lessee or licensee of
various other personal property assets that heretofore have been used in the
operation of a chain of specialty retail stores known as the &#147;<I>Disney
Store</I>&#148;; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
Licensee desires to continue to operate such chain of specialty retail stores in
accordance with the terms of the License Agreement referred to below; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
TDSF or its Affiliates have heretofore operated an online retail store located
on the World Wide Web at <U>www.disneystore.com</U>; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
Licensee desires to operate such online retail store in accordance with the
terms of the License Agreement referred to below; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
in order to enable Licensee to so operate such chain of specialty retail stores
and such online retail store, Licensee and TDSF are entering into, on the date
hereof, a License and Conduct of Business Agreement (as amended and in effect
from time to time, the &#147;<B>License Agreement</B>&#148;) pursuant to which
TDSF shall grant to Licensee certain rights in specified names, marks, symbols,
logos, characters and other proprietary designations and intellectual property
of TDSF and its Affiliates, all subject to and in strict adherence to the terms
and conditions set forth therein; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
upon the closing under the Acquisition Agreement, the Obligors shall become the
direct and indirect owners of all of the outstanding equity interests of
Licensee and therefore expect to receive substantial direct and indirect
benefits from the execution, delivery and performance by the Sellers of the
Acquisition Agreement and the execution, delivery and licensing of rights by
TDSF to Licensee under the License Agreement (the sufficiency of which benefits
to support this Guaranty and Commitment are hereby acknowledged); and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
it is a condition precedent to the Sellers&#146; obligation to consummate the
transactions contemplated by the Acquisition Agreement and a material inducement
to TDSF to enter into the License Agreement (which TDSF would not have done in
the absence of this Guaranty and Commitment) that the Obligors execute and
deliver this Guaranty and Commitment for the benefit of Licensee and TDSF; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
the obligations of the Obligors under this Guaranty and Commitment constitute a
material part of the consideration for TDSF and its Affiliates to enter into the
License Documents (as defined below) and to consummate the transactions
contemplated thereby; and </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WHEREAS,
in consideration of the foregoing premises, on and subject to the terms and
conditions provided herein, the Obligors wish (a) to guarantee the payment and
performance of the obligations of Licensee and/or its Affiliates to TDSF and/or
its Affiliates under or in respect of the License Documents and (b) to commit to
invest certain funds in TDS USA to support such obligations and Licensee&#146;s
operation of the Business; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
NOW,
THEREFORE, the Obligors, jointly and severally, hereby agree with TDSF and
Licensee as follows: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section 1.
<U>Definitions</U>.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Capitalized
terms defined in the License Agreement and used herein without other definition
shall have the respective meanings assigned thereto in the License Agreement. As
used in this Guaranty and Commitment, the following terms shall have the
respective meanings set forth below: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Acquisition
Agreement</B>&#148; has the meaning specified in the recitals to this Guaranty
and Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Affiliate
Guarantor</B>&#148; means an Affiliate of TCP that becomes a guarantor of all of
the obligations of the Obligors under this Guaranty and Commitment pursuant to
Section 4(m) hereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Approved
Letters of Credit</B>&#148; means irrevocable letters of credit, issued by one
(1) or more banks acceptable to TDSF in its business judgment for the account of
TCP and/or Licensee Parent as account parties and for the benefit of TDS USA,
that (i) provide that, for any purpose specified in Section 2(b) hereof and/or
upon the occurrence of any Event of Default, TDSF shall be authorized to draw,
as attorney-in-fact for, or otherwise on behalf of, TDS USA as beneficiary,
under any such letter of credit and direct such bank(s) to pay the amount of any
such draw solely and directly to TDS USA, and (ii) are otherwise in form and
substance satisfactory to TDSF in its business judgment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Arbitration
Procedures</B>&#148; has the meaning specified in Section 17 hereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Canadian
Parent</B>&#148; has the meaning specified in the recitals to this Guaranty and
Commitment and, in addition, shall be deemed to include any Person who is or
becomes a &#147;Canadian Parent&#148; under the License Agreement from time to
time in accordance with the terms and conditions thereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Capital
Lease Obligations</B>&#148; shall mean, as to any Person, the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and, for the purposes of this Agreement, the amount of such obligations at any
time shall be the capitalized amount thereof at such time determined in
accordance with GAAP. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>cash</B>" means currency denominated in United States dollars.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Cash
Equivalents</B>&#148; means (i) securities issued or directly and fully
guaranteed or insured by the United States government or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than twelve
(12) months from the date of acquisition; (ii) certificates of deposit and time
deposits denominated in United States dollars with maturities of twelve (12)
months or less from the date of acquisition, bankers&#146; acceptances with
maturities not exceeding twelve (12) months and overnight bank deposits, in each
case, with any domestic commercial bank having combined capital and surplus in
excess of Five Hundred Million Dollars ($500,000,000) and a Thompson Bank Watch
Rating at the time of acquisition of &#147;B&#148; (or the equivalent) or
better; (iii) commercial paper having a rating at the time of acquisition of at
least &#147;P-1&#148; or the equivalent from Moody&#146;s Investors Service,
Inc. or at least &#147;A-1&#148; or the equivalent from Standard &amp;
Poor&#146;s Rating Services and in each case maturing within thirty (30) days
after the date of acquisition; and (iv) money market funds, the assets of which
constitute Cash Equivalents of the kinds described in subparagraphs (i) through
(iii) of this definition. In the event that, after the date of this Guaranty and
Commitment, securities, instruments or other items of types not described in
clauses (i) through (iv) of this definition become properly classifiable as
&#147;Cash Equivalents&#148; under GAAP, the Obligors may request inclusion of
such items as Cash Equivalents for the purposes of this Guaranty and Commitment,
subject to TDSF&#146;s approval thereof in its business judgment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Consolidated
EBITDA</B>&#148; shall mean, for any period, with respect to any Person,
Consolidated Net Income of such Person and its Subsidiaries for such period
<U>plus</U>, without duplication and to the extent reflected as a charge in the
statement of such Consolidated Net Income for such period, the sum of
(a)&#160;income tax expense (whether or not paid during such period), (b)
Consolidated Interest Expense of such Person and its Subsidiaries, amortization
or write-off of debt discount and debt issuance costs and commissions, discounts
and other fees and charges associated with Indebtedness, (c) depreciation and
amortization expense, (d) amortization of intangibles (including, but not
limited to, goodwill) and (e)&#160;any extraordinary expenses or losses (and,
whether or not otherwise includable as separate items in the statement of such
Consolidated Net Income for such period, non-cash losses on sales of assets
outside of the ordinary course of business) and <U>minus</U>, to the extent
included in the statement of such Consolidated Net Income for such period, the
sum of (a)&#160;interest income (except to the extent deducted in determining
Consolidated Interest Expense) and (b)&#160;any extraordinary income or gains
(and, whether or not otherwise includable as a separate item in the statement of
such Consolidated Net Income for such period, non-cash gains on the sales of
assets outside of the ordinary course of business), all as determined on a
consolidated basis in accordance with GAAP. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Consolidated
Interest Expense</B>&#148; shall mean, for any period, with respect to any
Person, total cash interest expense (including that attributable to Capital
Lease Obligations) of such Person and its Subsidiaries for such period with
respect to all outstanding Indebtedness of such Person and its Subsidiaries
(including, without limitation, all commissions, discounts and other fees and
charges owed by such Person with respect to letters of credit and bankers&#146;
acceptance financing and net costs of such Person under Hedge Agreements in
respect of interest rates to the extent such net costs are allocable to such
period in accordance with GAAP). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Consolidated
Net Income</B>&#148; shall mean, for any period, with respect to any Person, the
consolidated net income (or loss) of such Person and its Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP and before
any reduction in respect of preferred equity dividends; <U>provided</U>, that,
in calculating Consolidated Net Income of a Person (for purposes of this
definition only, the &#147;<B>Parent</B>&#148;) and its consolidated
Subsidiaries for any period, there shall be excluded (a)&#160;the income (or
deficit) of any Person accrued prior to the date it becomes a Subsidiary of the
Parent or is merged into or consolidated with the Parent or any of its
Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary
of the Parent) in which the Parent or any of its Subsidiaries has an ownership
interest, except to the extent that any such income is actually received by the
Parent or such Subsidiary in the form of dividends or similar distributions, (c)
the undistributed earnings of any Subsidiary of the Parent to the extent that
the declaration or payment of dividends or similar distributions by such
Subsidiary is not at the time permitted by the terms of any Contract or Law
applicable to such Subsidiary, and (d) the cumulative effect of a change in
accounting principles. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>DCCS</B>&#148;
has the meaning specified in the recitals to this Guaranty and Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>DEI</B>&#148;
has the meaning specified in the recitals to this Guaranty and Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Direct
Obligations</B>&#148; means, collectively, (i) the Funding Commitment (as such
Funding Commitment may be adjusted pursuant to Sections 2(c) and 2(d) hereof)
and (ii) all other amounts payable by the Obligors pursuant to the terms hereof
in respect of the Funding Commitment, including, without limitation, any
interest, fees, costs and expenses (including enforcement costs, court costs and
legal, accounting, investment banking, appraisal and other professional fees and
expenses), whether direct or indirect, absolute or contingent, due or to become
due, existing on the date of this Guaranty and Commitment or hereafter incurred
or arising, which may arise under, out of or in connection with this Guaranty
and Commitment; <U>provided</U>, that the Direct Obligations shall not include
the Guaranteed Obligations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Event
of Default</B>&#148; has the meaning specified in Section 6 hereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Funding
Commitment</B>&#148; means the commitment by the Obligors to make capital
contributions to TDS USA in an aggregate commitment amount equal to One Hundred
Million Dollars ($100,000,000) in accordance with the terms of Section 2 hereof
(subject to adjustment as provided therein). </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Guaranteed
Obligations</B>&#148; means all obligations of every kind and nature of
Licensee, including, without limitation, any increases to the amounts thereof,
any and all Licensee Infringement/Breach Fees (including any Licensee
Infringement/Breach Fee incurred or accruing as a result of any failure by the
Obligors to honor the Funding Commitment) and any interest, fees, costs and
expenses (including enforcement costs) payable in respect thereof, whether
direct or indirect, absolute or contingent, due or to become due, existing on
the date of this Guaranty and Commitment or hereafter incurred or arising, which
may arise under, out of or in connection with the License Agreement or any of
the other License Documents; <U>provided</U>, that the Obligors shall not be
liable, during any Term, for any Guaranteed Obligations in excess of, in the
aggregate, the Guaranty Amount for such Term. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Guaranty Amount</B>&#148; means Twenty-Five Million Dollars
($25,000,000) in the aggregate for each individual Term; <U>provided</U>, that
the Guaranty Amount shall be increased by an amount equal to the TDS Canada
Funds Amount in the event of a Royalty Breach with respect to any Monthly
Royalty Amount that is attributable to TDS USA&#146;s use of the Licensed
Materials until the later to occur of (a) the commencement of the next Term, if
any, or (b) the date on which such Royalty Breach is cured. No payments made in
respect of Guaranteed Obligations during any one Term shall reduce the
Guaranteed Obligations or the Guaranty Amount for any subsequent Term, which
Guaranty Amount shall be Twenty-Five Million Dollars ($25,000,000) (as increased
by any unpaid TDS Canada Funds Amount pursuant to the preceding sentence) for
each such subsequent Term. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Guaranty
and Commitment</B>&#148; has the meaning specified in the preamble to this
Guaranty and Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Hedge
Agreements</B>&#148; shall mean all interest rate swaps, caps, collar agreements
or similar arrangements entered into by Licensee or its Subsidiaries providing
for protection against fluctuations in interest rates or currency exchange rates
or the exchange of nominal interest obligations, either generally or under
specific contingencies. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Insolvency
Event</B>&#148; means (a) any event described in Section 13.6 (Insolvency) of
the License Agreement or (b) the initiation of any enforcement action of any
kind against TCP, any of its Subsidiaries, or any of their respective assets,
whether by means of foreclosure, assignment for the benefit of creditors, or any
judicial or other proceeding or process, or delivery of written notice of
commencement of any such action, in each case described in this subparagraph
(b), by or on behalf of one or more lenders under the Company Credit Facility
(as defined in the Acquisition Agreement) or any other loan agreements, credit
agreements, lines of credit, working capital or other bank facilities or similar
arrangements under which a bank or other financial institution provides loans
and/or letters of credit having an aggregate outstanding principal amount equal
to or exceeding Ten Million Dollars ($10,000,000) on the date of reference
thereto, to TCP and/or any one or more of its Subsidiaries. Notice of default,
or acceleration of indebtedness, in either case without further action or notice
of commencement of further action, shall not be considered enforcement action
for purposes of this definition. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>License
Agreement</B>&#148; has the meaning specified in the recitals to this Guaranty
and Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>License
Document Breach</B>&#148; means (i) any Uncured Royalty Breach, (ii) any Uncured
Licensee Infringing Use, and (iii) any material breach or violation by Licensee
or any of its Affiliates of any representation or warranty under, any material
failure by Licensee or any of its Affiliates to perform any of their respective
agreements or obligations under, or any material non-compliance by Licensee or
any of its Affiliates with any of the terms, provisions or conditions, of, any
of the License Documents, which breach, violation, failure or non-compliance is
not cured within the applicable cure period specified in such License Document
or within twenty (20) Business Days if not so specified, in the case of each of
the preceding subparagraphs (i), (ii) and (iii) to the extent that payment by
the Obligors of all or any portion of the then-remaining Funding Commitment
would be necessary to, or could, (a) prevent such Royalty Breach, Licensee
Infringing Use, breach, violation, failure or non-compliance and/or (b) enable
Licensee to cure such Royalty Breach, Licensee Infringing Use, breach,
violation, failure or non-compliance. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>License
Documents</B>&#148; means the License Agreement and all other documents,
instruments and agreements from time to time executed and/or delivered in
connection therewith or pursuant thereto (including, without limitation, the
Transitional Administrative Services Agreement, the Transitional Distribution
Services Agreement, the Transitional Information Technology Services Agreement
and the Transitional Disney Retained Stores Agreement (each as defined in the
Acquisition Agreement), but excluding the Acquisition Agreement and this
Guaranty and Commitment), as in effect on the date of this Guaranty and
Commitment, as may become effective after the date hereof or as subsequently
amended, supplemented, modified or amended and restated. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Licensee</B>&#148;
has the meaning specified in the preamble to this Guaranty and Commitment and,
in addition, shall be deemed to include any Person who is or becomes a
&#147;Licensee&#148; under the License Agreement from time to time in accordance
with the terms and conditions thereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Licensee
Parent</B>&#148; has the meaning specified in the preamble to this Guaranty and
Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Material
Adverse Effect</B>&#148; means a material adverse effect on (i) the business,
property, operations or condition (financial or otherwise) of the Obligors, on a
consolidated basis, or (ii) the validity or enforceability of any material
provision of this Guaranty and Commitment or any of the License Documents, the
rights or remedies of TDSF or Licensee hereunder or thereunder or the ability of
the Obligors to perform their obligations (including, without limitation,
payment of the Obligations) hereunder or thereunder in accordance with the terms
hereof or thereof. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>NWC
Dividend Payments</B>&#148; means the payment of any dividends or other
distributions pursuant to and in accordance with the terms of Section
9.13.3(b)(III) of the License Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Obligations</B>&#148; shall mean, collectively, the Direct Obligations
and the Guaranteed Obligations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Obligor</B>&#148;
and &#147;<B>Obligors</B>&#148; have the respective meanings specified in the
preamble to this Guaranty and Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Restricted
Payment</B>&#148; means (i) any dividend, distribution or other payment by any
Person to the direct or indirect holders of its equity interests (other than
pursuant to and in accordance with the TCP Tax Sharing Agreement or the TCP
Intercompany Services Agreement) or (ii) any transfer of properties, rights or
assets by any Person to the direct or indirect holders of its equity interests,
to the extent that the consideration received by the transferring Person at the
time of such transfer is less than the fair market value of the properties,
rights or assets so transferred; <U>provided</U>, that neither a dividend,
distribution or other payment nor a transfer of properties, rights or assets by
TDS Canada to Canadian Parent or TDS USA or by Canadian Parent to TDS USA shall
be or be deemed to be a &#147;Restricted Payment.&#148; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Sellers</B>&#148;
has the meaning specified in the recitals to this Guaranty and Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>TCP</B>&#148;
has the meaning specified in the preamble to this Guaranty and Commitment. In
the event that all or any portion representing more than fifty percent (50%) of
the business, revenues, profits, assets, properties and/or operations of TCP are
Transferred (in any single transaction or in the aggregate) to or otherwise
undertaken by one or more Affiliates of TCP, whether by way of a sale of assets,
merger, reorganization, consolidation, operation of law, transition to a new
operating company or otherwise, the obligations, restrictions and provisions
pertaining to TCP hereunder shall apply in full to both TCP and each such
Affiliate of TCP, each such Affiliate of TCP shall be deemed to be an
&#147;Obligor&#148; hereunder and TCP and each such Affiliate of TCP shall be
jointly and severally liable for all of the liabilities, duties and obligations
of TCP hereunder (including the Obligations), and each such Affiliate shall, as
a condition of any such Transfer, be required to execute and deliver an
Assumption Agreement substantially in the form of <U>Exhibit A</U> hereto,
pursuant to which such Affiliate shall assume the liabilities, duties,
obligations, restrictions and provisions applicable to an &#147;Obligor&#148;
hereunder, and accept the designation as an &#147;Obligor&#148; hereunder, and
the Obligors shall be required to provide an original counterpart of such
Assumption Agreement to TDSF. In the event that such Affiliate of TCP does not
execute and deliver such Assumption Agreement, or such Assumption Agreement is
for any reason not delivered to TDSF, such Affiliate of TCP shall nonetheless
automatically become an Obligor hereunder, for all purposes hereof and shall be
bound by the provisions hereof to the fullest extent permitted by Law. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>TDS
Canada</B>&#148; means The Disney Store (Canada) Ltd., a corporation
incorporated under the laws of the Province of Ontario, until (i) the
continuation of such Entity in, and the amalgamation of such entity with an
entity incorporated in, the province of New Brunswick, Canada, at which time
&#147;TDS Canada&#148; shall refer to Hoop Canada, Inc., a corporation
incorporated under the laws of the Province of New Brunswick, as successor to
the original corporation, and (ii) the execution and delivery of the Canadian
Joinder as contemplated by Section 9.12.1(a)(II) of the License Agreement,
whereupon &#147;TDS Canada&#148; shall refer individually and collectively to
Hoop Canada, Inc. and New Canadian Limited Partnership. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>TDS
Canada Funds Amount</B>&#148; means, as of any date, the aggregate amount of all
cash and cash equivalents of TDS Canada and all funds available under any and
all Debt Facilities of TDS Canada, which cash, cash equivalents and funds would
have been available for use by TDS Canada to prevent and/or cure a Royalty
Breach with respect to any Monthly Royalty Amount that is attributable to TDS
USA&#146;s use of the Licensed Materials but for the fact that TDS Canada is not
liable for the payment of any such Monthly Royalty Amount pursuant to Section
7.6 of the License Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>TDS
USA</B>&#148; means The Disney Store, LLC, a California limited liability
company, until the consummation of the TDS USA Merger contemplated by Section
9.12.1(a)(I) of the License Agreement, whereupon the Entity that survives the
TDS USA Merger, as the successor to TDS USA, shall be and be deemed to be
&#147;TDS USA.&#148; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>TDSF</B>&#148;
has the meaning specified in the preamble to this Guaranty and Commitment. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Term</B>&#148; means the Initial Term or any Renewal Term.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Wells
Fargo Credit Facility</B>&#148; means the Wells Fargo Credit Facility, as
defined in the Acquisition Agreement, as in effect on the date hereof, unless
otherwise provided. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 2. <U>Funding Commitment and Other Direct Obligations</U>.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) On the date
hereof, immediately following consummation of the transactions contemplated by
the Acquisition Agreement, the Obligors have invested Fifty Million Dollars
($50,000,000) of the Funding Commitment in TDS USA in the form of cash or freely
transferable Cash Equivalents.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) The Obligors
hereby jointly and severally agree to invest the remaining balance of the
Funding Commitment as and to the extent needed to enable Licensee and/or its
Affiliates to comply with their respective obligations under the License
Documents (including, without limitation, any obligations of Licensee in the
event of expiration or earlier termination of the Licensee Agreement as set
forth in Section 16 thereof), to prevent and/or cure any License Document Breach
and to fund any operating losses incurred by Licensee or its Affiliates in
connection with the operation of the Business. The Obligors may satisfy their
obligations with respect to the remaining balance of the Funding Commitment by
investing in TDS USA in the form of cash or freely transferable Cash Equivalents
or by providing to TDS USA one or more Approved Letters of Credit or any
combination of the foregoing; provided, that, for purposes of clarification, the
Obligors' obligations under this Section 2(b) shall not be or be deemed to be
fulfilled until the entire Funding Commitment has been fully and indefeasibly
paid and satisfied through the payment of cash or freely transferable Cash
Equivalents (including pursuant to any draw under an Approved Letter of Credit)
pursuant to and in accordance with the terms of this Guaranty and Commitment.
For the purposes of this Section 2(b) only, Restricted Payments that Licensee
and its Subsidiaries are permitted under Section 9.13.3(b)(III) or 9.13.3(b)(IV)
of the License Agreement to make to the Obligors and Restricted Payments by TDS
USA to the Obligors that have been approved by TDS USA's Independent Directors
in accordance with the terms of the License Agreement and applicable Law shall
be treated as payments by the Obligors in respect of the Funding Commitment in
"cash" to the extent that the Obligors (i) notify TDSF in writing of their
intent not to receive any such Restricted Payment and retain the amount thereof
as an additional investment in TDS USA pursuant to this Section 2(b), and (ii)
in fact cause TDS USA (or its Subsidiaries) to retain the amount of any such
Restricted Payment as an additional investment pursuant to this Section
2(b).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) The Funding
Commitment, to the extent not previously fully and indefeasibly paid and
satisfied pursuant to and in accordance with the terms of this Guaranty and
Commitment, shall be reduced dollar-for-dollar by the cumulative amount of
Consolidated EBITDA of Licensee and its Subsidiaries generated from the
Effective Date through any applicable date of calculation; <U>provided</U>, that in no
event shall the Funding Commitment be reduced pursuant to this Section 2(c) by
an amount greater than Ten Million Dollars ($10,000,000) in the aggregate and in
no event shall Licensee ever be required to refund to any Obligor any portion of
the Funding Commitment that has been previously paid, notwithstanding any
subsequent reduction of the Funding Commitment pursuant to this Section
2(c).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) In the event
that Licensee makes any Restricted Payments to any of the direct or indirect
holders of its equity interests, the unpaid balance of the Funding Commitment
shall be increased dollar-for-dollar, but not to an amount greater than Ninety
Million Dollars ($90,000,000), by the amount of such Restricted Payments, except
with respect to Restricted Payments constituting NWC Dividend Payments, which
shall not result in any increase in the unpaid balance of the Funding
Commitment.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) The Obligors
hereby jointly and severally agree, as principal obligors and not as guarantors
only, without limitation as to amount, to pay to TDSF, on demand, all fees,
costs and expenses (including without limitation court costs and legal,
accounting, investment banking, appraisal and any other applicable professional
fees and expenses), incurred or expended by TDSF or its Affiliates in connection
with the performance of the Obligations and this Guaranty and Commitment and the
enforcement thereof and hereof.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) The Obligors
acknowledge and agree that TDSF has relied on the undertaking of the Funding
Commitment and the other Direct Obligations by the Obligors in agreeing to enter
into the Acquisition Agreement and the License Documents and to consummate the
transactions contemplated thereby. In particular, TDSF is relying on the payment
by the Obligors of the Funding Commitment to enable Licensee to perform its
obligations under the License Agreement. In consideration of the foregoing, the
Obligors agree that (i) subject to and in accordance with the terms of
subparagraph (i) of Section 6 hereof, if an Insolvency Event occurs, the
Obligors will pay any unpaid balance of the Funding Commitment, in addition to
any unpaid portion of the Guaranty Amount, to TDSF and (ii) subject to and in
accordance with the terms of subparagraph (ii) of Section 6 hereof, if a License
Document Breach occurs, the Obligors will pay to TDSF any amounts due under
Section 3 hereof with respect to any Guaranteed Obligations, up to the unpaid
portion of the Guaranty Amount, and, if applicable, pay to TDS USA on demand any
additional amounts that may be necessary, up to the unpaid balance of the
Funding Commitment, to enable Licensee to cure such License Document
Breach.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 3. <U>Unconditional Guaranty of Payment and Performance of Guaranteed
Obligations</U>.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) The Obligors
hereby jointly and severally guarantee to TDSF the full and punctual payment
when due (whether at scheduled payment date, by required prepayment, by
acceleration or otherwise), as well as the performance, of all of the Guaranteed
Obligations for each Term of the License Agreement, including all such
Guaranteed Obligations that would become due but for the operation of the
automatic stay pursuant to Section 65(2)(a) of the Federal Bankruptcy Code and
the operation of Sections 502(b) and 506(b) of the Federal Bankruptcy Code;
provided, however, the Obligors' liability with respect to the Guaranteed
Obligations shall be limited during each Term to the Guaranty Amount. This
Guaranty and Commitment is an absolute, unconditional and continuing guaranty of
the full and punctual payment and performance of all of the Guaranteed
Obligations and not of their collectibility only and is in no way conditioned
upon any requirement that TDSF first attempt to collect any of the Guaranteed
Obligations from Licensee or resort to any collateral security or other means of
obtaining payment. Should Licensee default in the payment or performance of any
of the Guaranteed Obligations and fail to cure such default within any
applicable grace period, the obligations of the Obligors hereunder with respect
to such Guaranteed Obligations in default shall become immediately due and
payable to TDSF, for the benefit of TDSF, without demand or notice of any nature
to the Obligors, all of which are expressly waived by the Obligors. Payments by
the Obligors hereunder may be required by TDSF on any number of occasions. All
payments of the Guaranteed Obligations by the Obligors hereunder shall be made
to TDSF in the manner specified for payment of Licensee Payments in Section 7.3
(Manner of Payments) of the License Agreement within five (5) Business Days
following the date on which the obligations of the Obligors hereunder with
respect to such Guaranteed Obligations become due and payable pursuant to this
Section 3(a).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) If for any
reason Licensee has no legal existence or is under no legal obligation to
discharge any of the Guaranteed Obligations, or if any of the Guaranteed
Obligations have become irrecoverable from Licensee by reason of Licensee's
insolvency, bankruptcy or reorganization or by other operation of law or for any
other reason, this Guaranty and Commitment shall nevertheless be binding on the
Obligors and any Affiliate Guarantors to the same extent as if the Obligors and
any Affiliate Guarantors at all times had been the principal obligors on all
such Guaranteed Obligations (up to the Guaranty Amount). In the event that
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of Licensee, or for any
other reason, all amounts otherwise payable under the terms of the License
Documents, or any other agreement evidencing, securing or otherwise executed in
connection with any Guaranteed Obligation (up to the Guaranty Amount) shall be
immediately due and payable by the Obligors and any Affiliate Guarantors.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) The Direct
Obligations and the Guaranteed Obligations are cumulative and may be enforced by
TDSF separately or collectively. No payments in respect of the Guaranteed
Obligations shall reduce the amount of the Direct Obligations, and no payments
in respect of the Direct Obligations or other investments, contributions or
payments by any Obligor or Affiliate Guarantor to or on behalf of Licensee shall
reduce the amount of the Guaranteed Obligations or the Guaranty Amount.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) The Affiliate
Guarantors (if any) hereby jointly and severally guarantee to TDSF the full and
punctual payment when due (whether at scheduled payment date, by required
prepayment, by acceleration or otherwise), as well as the performance, of all of
the Obligations for each Term of the License Agreement, including all such
Obligations that would become due but for the operation of the automatic stay
pursuant to Section 65(2)(a) of the Federal Bankruptcy Code and the operation of
Sections 502(b) and 506(b) of the Federal Bankruptcy Code; provided, however,
the Affiliate Guarantors' and the Obligors' collective liability with respect to
the Guaranteed Obligations shall be limited during each Term to the Guaranty
Amount. This Guaranty and Commitment is an absolute, unconditional and
continuing guaranty of the full and punctual payment and performance of all of
the Obligations and not of their collectibility only and is in no way
conditioned upon any requirement that TDSF first attempt to collect any of the
Obligations from the Obligors or Licensee or resort to any collateral security
or other means of obtaining payment. Should the Obligors or Licensee default in
the payment or performance of any of the Obligations and fail to cure such
default within any applicable grace period, the obligations of the Affiliate
Guarantors hereunder with respect to such Obligations in default shall become
immediately due and payable to TDSF, for the benefit of TDSF, without demand or
notice of any nature to the Affiliate Guarantors, all of which are expressly
waived by the Affiliate Guarantors. Payments by the Affiliate Guarantors
hereunder may be required by TDSF on any number of occasions. All payments of
the Obligations by the Affiliate Guarantors hereunder shall be made to TDSF in
the manner specified for payment of Licensee Payments in Section 7.3 (Manner of
Payments) of the License Agreement within five (5) Business Days following the
date on which the obligations of the Affiliate Guarantors hereunder with respect
to such Obligations become due and payable pursuant to this Section 3(d).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 4.</B>
<B><U>Representations, Warranties and Covenants of the Obligors and any
Affiliate Guarantors</U></B><U></U>. TCP, Licensee Parent and each Affiliate
Guarantor (if any), jointly and severally, represent and warrant to, and
covenant with, TDSF and Licensee as follows, in each case as of the date hereof
and as of the commencement date of each Renewal Term with the same effect as
though made at such time (except that any representation or warranty made as of
a particular date shall be true as of such date): </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) TCP is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware. Licensee Parent is a limited liability company
duly organized, validly existing and in good standing under the laws of the
State of Delaware. Each Affiliate Guarantor (if any) is duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization. Each of the Obligors has the requisite power and authority to (i)
execute and deliver this Guaranty and Commitment and the documents and
instruments contemplated hereby, (ii) perform and comply with all of the terms,
conditions and covenants to be performed and complied with by it hereunder and
thereunder and (iii) own its properties and assets and carry on its business as
currently conducted.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) All necessary
action on the part of each of the Obligors has been duly and validly taken to
authorize the execution, delivery and performance of this Guaranty and
Commitment and such other agreements and instruments to be executed and
delivered by the Obligors in connection herewith. All necessary action on the
part of each Affiliate Guarantor (if any) has been duly and validly taken to
authorize the execution, delivery and performance of this Guaranty and
Commitment and such other agreements and instruments to be executed and
delivered by such Affiliate Guarantor in connection herewith. This Guaranty and
Commitment has been duly executed and delivered by the Obligors and constitutes
the legal, valid and binding obligation of each such Obligor, enforceable
against each such Obligor in accordance with the terms hereof. A guaranty of the
Obligations under this Guaranty and Commitment has been duly executed and
delivered by each Affiliate Guarantor (if any) and constitutes the legal, valid
and binding obligation of each such Affiliate Guarantor, enforceable against
each such Affiliate Guarantor in accordance with the terms of such guarantee and
of this Guaranty and Commitment.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) Except as set
forth on TDS Schedule 4.8.2 to the Acquisition Agreement, no consent,
authorization, approval, order, license, certificate or permit of or from, or
declaration or filing with, any Governmental Entity is required for the
execution, delivery and performance by the Obligors of this Guaranty and
Commitment or any of the agreements or instruments contemplated hereby. Neither
the execution, delivery and performance by the Obligors or any Affiliate
Guarantors of this Guaranty and Commitment, any assumption or guaranty of
obligations hereunder, or such other agreements and instruments nor the
consummation of the transactions contemplated hereby or thereby will: (i)
violate any provision of the Governing Documents of any Obligor or any Affiliate
Guarantor; (ii) violate any Law to which any Obligor or any Affiliate Guarantor
is subject that would have a Material Adverse Effect; (iii) violate any material
Contract to which any Obligor or any Affiliate Guarantor is a party or is
subject, or (iv) result in the imposition of any material Encumbrance against
any Obligor or any Affiliate Guarantor or any of their respective properties.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) There is no
Action pending or, to the knowledge of the Obligors, threatened against or
affecting any Obligor or any of their respective Affiliates or any of its or
their properties or assets that has or would reasonably be expected to have a
Material Adverse Effect.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) No Obligor has
any reason to believe that the Obligors would be unable to fully pay and perform
the Obligations and their other obligations hereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) Immediately
after the execution and delivery of this Guaranty and Commitment (including
after giving effect to the execution, delivery and performance of this Guaranty
and Commitment and the License Documents and the incurrence by the Obligors of
the Obligations), (i) the fair market value of the assets of both (A) the
Obligors taken together but without their consolidated Subsidiaries and (B) the
Obligors on a consolidated basis with their Subsidiaries, exceeds and will
exceed their liabilities, taken together but without their consolidated
Subsidiaries and on a consolidated basis with their Subsidiaries, (ii) the
present fair saleable value of the assets of both (A) the Obligors taken
together but without their consolidated Subsidiaries and (B) the Obligors on a
consolidated basis with their Subsidiaries, exceeds and will exceed the
liabilities of both (A) the Obligors taken together but without their
consolidated subsidiaries and (B) the Obligors on a consolidated basis with
their Subsidiaries, (iii) both (A) the Obligors taken together but without their
consolidated Subsidiaries and (B) the Obligors on a consolidated basis with
their Subsidiaries, are and will be able to pay their debts as such debts
respectively mature or otherwise become absolute or due, and (iv) neither (A)
the Obligors taken together but without their consolidated Subsidiaries nor (B)
the Obligors on a consolidated basis with their Subsidiaries, have or will have
an unreasonably small capital with which to conduct their operations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g) Since December
31, 2003, there has been no event, development or circumstance that has had or
would reasonably be expected to have a Material Adverse Effect.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h) None of the
Obligors or any Affiliate Guarantors is in default under or with respect to, or
in breach or violation of, any of its material obligations under any material
contract, agreement, instrument, indenture, lease, mortgage, security document
or other document in any respect. No Event of Default has occurred and is
continuing.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Each of the
Obligors and Affiliate Guarantors has fully reviewed each of the License
Documents and acknowledges and accepts the terms thereof. The Obligors, jointly
and severally, hereby agree to (i) perform and comply with, (ii) cause
Licensee's Affiliates to perform and comply with and/or (iii) assist Licensee in
the performance of and compliance with all of the representations, warranties,
terms, conditions, covenants and obligations under any of the License Documents
relating or applicable to any of Licensee's Affiliates, including the Obligors;
<I>provided, however,</I> that the Obligors shall not be required by this Section 4(i)
to expend funds in an amount exceeding the then-remaining portion of the Funding
Commitment and the Guaranty Amount to cause Licensee to comply with any
provisions of the License Documents applicable solely to Licensee (it being
understood that this proviso does not apply to provisions applicable to any
Affiliates of Licensee).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (j) No statement or
information contained in this Guaranty and Commitment, any License Document or
any certificate furnished by or on behalf of the Obligors to TDSF for use in
connection with the transactions contemplated by this Guaranty and Commitment or
any License Document contains any untrue statement of a material fact or omits
to state a material fact necessary to make the statements contained herein or
therein not misleading. There is no fact known to any Obligor that would
reasonably be expected to have a Material Adverse Effect that has not been
expressly disclosed in this Guaranty and Commitment, the License Documents or
any other documents, certificates and statements furnished to TDSF for use in
connection with the transactions contemplated hereby or by the License
Documents.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (k) TCP agrees
that, in the event that the Wells Fargo Credit Facility (or any amended,
refinanced or replacement debt facility) contains any limitations, restrictions
or prohibitions on the capital expenditures or investments of TCP or its
Affiliates, TCP shall enter into, and maintain continuously through January 31,
2009, a covenant in the Wells Fargo Credit Facility (or any amended, refinanced
or replacement debt facility) providing that it will reserve solely for the
payment of the Funding Commitment, and not invest in any other Person or use (by
means of incurring direct or indirect obligations or otherwise) or expend for
any other purpose, the respective amounts indicated in the table below (or, if
less, the then-remaining Funding Commitment) as portions of the amounts
permitted to be expended or invested per fiscal year or other applicable period
pursuant to Section 7.20 of the Wells Fargo Credit Facility (or the
corresponding provision of any amended, refinanced or replacement debt
facility):</FONT></P>

<PRE>
                                                      Amount to be Preserved
                         Period                       for Funding Commitment
                         ------                       ----------------------

Closing Date through January 31, 2006                       $10,000,000

February 1, 2006 - January 31, 2007                         $15,000,000

February 1, 2007 - January 31, 2008                         $20,000,000

February 1, 2008 - January 31, 2009                         $15,000,000

</PRE>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (l) Each of the
Obligors agrees that it will neither cause Licensee to make, nor will such
Obligor accept, any NWC Dividend Payment or other Restricted Payment of any kind
from or on behalf of Licensee or its Subsidiaries, directly or indirectly,
unless such Restricted Payment is either (i) permitted by Section 9.13.3(b) of
the License Agreement without the approval of the Independent Directors of
Licensee or its Affiliates or (ii) approved by the Independent Directors of
Licensee or its Affiliates.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (m) In the event
that any portion representing five percent (5%) or more of the business,
revenues, profits, assets, properties and/or operations of TCP are Transferred
(in any single transaction or in the aggregate) to, or otherwise undertaken by,
one or more Affiliates of TCP, whether by way of a sale of assets, merger,
reorganization, consolidation, operation of law, transition to a new operating
company or otherwise, then each such Affiliate of TCP receiving any of the
business, revenues, profits, assets, properties and/or operations of TCP shall
be deemed for all purposes hereof an "Affiliate Guarantor" hereunder, and TCP
and such Affiliate of TCP and all other such Affiliates of TCP shall be jointly
and severally liable for all of the liabilities, duties and obligations of the
Affiliate Guarantors hereunder (including the Obligations), and each such
Affiliate shall, as a condition of any such Transfer, be required to execute and
deliver, and to provide TDSF an Affiliate Guaranty in substantially the form of
<U>Exhibit B</U> hereto, pursuant to which such Affiliate shall guarantee the
liabilities, duties, obligations, restrictions and provisions of the Obligors
hereunder, and accept the designation as an "Affiliate Guarantor" hereunder and
the Obligors shall be required to provide an original counterpart of such
Affiliate Guaranty to TDSF. In the event that such Affiliate of TCP does not
execute and deliver such Affiliate Guaranty, or such Affiliate Guaranty is for
any reason not delivered to TDSF, such Affiliate of TCP shall nonetheless
automatically become an Affiliate Guarantor hereunder for all purposes hereof
and shall be bound by the provisions hereof to the fullest extent permitted by
Law. For the purposes of this Section 4(m), any transfer of employees to an
Affiliate shall not itself constitute a transfer of business of an Obligor, but
any revenues, profits, assets, properties and/or operations transferred as a
result of any such transfer of employees shall be considered in the calculation
of the five percent (5%) of business, revenues, profits, assets, properties
and/or operations of TCP contemplated by the first sentence of this Section
4(m). This Section 4(m) shall not apply to any Affiliate of TCP that becomes an
Obligor pursuant to the definition of "TCP".</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (n) At least
fifteen (15) Business Days prior to the expected effective date thereof, the
Obligors shall provide TDSF with initial drafts of all amendments, refinancings
or replacements to be entered into by TCP or its Affiliates in connection with
the Wells Fargo Credit Facility (or any other debt facility of TCP or its
Affiliates in place thereof) and shall, thereafter, provide TDSF with each
revised draft of any such amendment, refinancing or replacement that is
distributed between the parties thereto (redlined to reflect changes therein).
TDSF shall have the right to review and comment on all drafts of such
amendments, refinancings or replacements, which comments shall be considered by
TCP and its Affiliates in good faith, and the final versions of all terms and
provisions of such amendments, refinancings or replacements that, as reasonably
determined by TDSF, relate to or affect in any manner this Guaranty and
Commitment, the Acquisition Agreement or any of the License Documents, the
rights or obligations of the parties hereunder or thereunder, or the Licensed
Materials, shall be subject to the prior written approval of TDSF, which
approval shall not be unreasonably withheld (such approval or disapproval to be
communicated to TCP within five (5) Business Days after such final versions are
provided to TDSF). TCP hereby agrees to use all of its commercially reasonable
efforts, and to cause its Affiliates to use all of their commercially reasonable
efforts, to resolve or cause the resolution of (including, without limitation,
using all of its commercially reasonable efforts to negotiate with the
applicable lenders and/or their representatives), any issues arising out of or
resulting from the exercise by TDSF of its approval rights under this Section
4(n). Any proposed amendment of the Wells Fargo Credit Facility that is not
approved by TDSF in accordance with and as provided in this Section 4(n) or that
does not otherwise comply with the other terms and provisions of this Guaranty
and Commitment (including, without limitation, the other terms and provisions of
this Section 4(n)), or that does not comply with all of the terms and provisions
of the Acquisition Agreement and the License Documents, shall be deemed to be a
breach of this Guaranty and Commitment. TCP and its Affiliates shall be required
to comply with the terms and provisions of this Section 4(n) only through and
including January 31, 2009.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 5.</B>
<B><U>Waivers by Obligors and any Affiliate Guarantors; TDSF&#146;s and
Licensee&#146;s Freedom to Act</U></B><U></U>. The Obligors, jointly and
severally, and any Affiliate Guarantors, jointly and severally, agree that the
Obligations will be paid and performed strictly in accordance with their
respective terms, regardless of any Law now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of TDSF or Licensee with
respect thereto. The Obligors and any Affiliate Guarantors waive promptness,
diligences, presentment, demand, protest, notice of acceptance, notice of any
Obligations incurred and all other notices of any kind other than notices
expressly provided for in the License Documents, proof of reliance of TDSF or
Licensee on this Guaranty and Commitment, all defenses which may be available by
virtue of any valuation, stay, moratorium law or other similar Law now or
hereafter in effect (including without limitation , Section 2809 of the
California Civil Code, Sections 359.5 and 580d of the California Code of Civil
Procedure, Sections 2787 to 2855, inclusive, and Section 3433 of the California
Civil Code) any right to require the marshalling of assets of Licensee or any
other Person primarily or secondarily liable with respect to any of the
Obligations, and all suretyship defenses generally. Without limiting the
generality of the foregoing, each Obligor and any Affiliate Guarantor agree to
the provisions of any instrument evidencing, securing or otherwise executed in
connection with any Obligation and agrees that the obligations of the Obligors
and any Affiliate Guarantors hereunder shall not be released or discharged, in
whole or in part, or otherwise affected by (a)&#160;the failure of TDSF to
assert any claim or demand or to enforce any right or remedy against Licensee or
any other Person primarily or secondarily liable with respect to any of the
Obligations; (b)&#160;any extensions, compromises, refinancing, consolidation or
renewals of any Obligation; (c)&#160;any change in the time, place or manner of
payment of any of the Obligations or any rescissions, waivers, compromises,
refinancing, consolidation or other amendments or modifications to any of the
terms or provisions of the License Documents, or any other agreement evidencing,
guarantying, securing or otherwise executed in connection with any of the
Obligations; (d)&#160;the addition, substitution or release of any Person
primarily or secondarily liable for any Guaranteed Obligation; (e)&#160;the
adequacy of any rights that TDSF or Licensee may have against any collateral
security or other means of obtaining repayment of any of the Obligations;
(f)&#160;the impairment of any collateral securing any of the Obligations,
including, without limitation, the failure to perfect or preserve any rights
that TDSF or Licensee might have in such collateral security or the
substitution, exchange, surrender, release, loss or destruction of any such
collateral security; (g) any defense, right of offset or counterclaim that may
at any time be available to be asserted by Licensee or any other Person against
TDSF or any of its Affiliates; or (h)&#160;any other circumstance, event, act or
omission whatsoever that might in any manner or to any extent vary the risk of
such Obligor or any Affiliate Guarantor or otherwise operate as a release,
exoneration or discharge (equitable or legal) of such Obligor or any Affiliate
Guarantor, all of which may occur or be done without notice to any Obligor or
any Affiliate Guarantors. To the fullest extent permitted by Law, each Obligor
and any Affiliate Guarantor hereby expressly waive any and all rights or
defenses arising by reason of (i)&#160;any &#147;one action&#148; or
&#147;anti-deficiency&#148; law that might otherwise prevent TDSF or Licensee
from bringing any action, including any claim for a deficiency, against such
Obligor or any Affiliate Guarantor before or after TDSF&#146;s or
Licensee&#146;s commencement or completion of any foreclosure action, whether
judicially, by exercise of power of sale or otherwise, or (ii)&#160;any other
Law that in any other way would otherwise require any election of remedies by
TDSF or Licensee. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 6.</B>
<B><U>Default; Acceleration; Other Remedies</U></B>. If any of the following
events (each, an &#147;<B>Event of Default</B>&#148;) shall occur: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) any Obligor
shall fail to pay on demand or, as applicable, when due and payable, or any
Affiliate Guarantor shall fail to pay in accordance with the terms of this
Guaranty and Commitment, any portion of the Obligations and shall fail to cure
such failure within ten (10) Business Days following written notice thereof from
TDSF or any of its Affiliates; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) any Obligor or
Affiliate Guarantor shall breach or violate, fail to perform any of its
obligations (other than obligations of the kinds described in subparagraph 6(a))
under, or fail to comply with any of the other terms or provisions of, this
Guaranty and Commitment and shall fail to cure such breach, violation or failure
within ten (10) Business Days following written notice thereof from TDSF or any
of its Affiliates; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) any Obligor or
Affiliate Guarantor shall breach in any material respect (<I>provided, that,</I> any
representation or warranty of any Obligor or Affiliate Guarantor contained
herein that is already qualified by materiality shall be deemed to be not so
qualified for purposes of this Section 6(c), so that there will be no
duplication between such qualifier contained within such representation or
warranty and the "materiality" qualifier in this subparagraph) any
representation or warranty of such Obligor in this Guaranty and Commitment or in
any certificate or notice given in connection herewith and shall fail to cure
such breach within ten (10) Business Days following written notice thereof from
TDSF or any of its Affiliates; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) any Obligor or
Affiliate Guarantor shall notify any other party hereto of its intent to
terminate this Guaranty and Commitment or its obligations hereunder and shall
fail to rescind such notification in writing delivered to TDSF and Licensee
within ten (10) Business Days following such notification; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) a License
Document Breach shall occur; or </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f) an event of
default shall occur under the Company Credit Facility, as defined in the
Acquisition Agreement, or any other loan agreements, credit agreements, lines of
credit, working capital or other bank facilities or similar arrangements under
which a bank or other financial institution provides loans and/or letters of
credit to TCP and/or any one or more of its Subsidiaries, and shall be
continuing beyond any applicable grace or cure periods specified therefor in
such Company Credit Facility or in any other loan agreements, credit agreements,
lines of credit, working capital or other bank facilities or similar
arrangements under which a bank or other financial institution provides loans
and/or letters of credit to TCP and/or any one or more of its Subsidiaries, and
such event of default shall have resulted in indebtedness of TCP and/or its
Subsidiaries in aggregate outstanding principal amount equal to or exceeding Ten
Million Dollars ($10,000,000) being or becoming immediately due and payable; or
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(g) an Insolvency
Event shall occur (it being understood that, in the case of an Insolvency Event
for which a grace period is specified in Section 13.6 of the License Agreement,
an Insolvency Event shall be deemed to have occurred only upon the expiration of
such grace period); </FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>THEN, or at any time
thereafter while any such Event of Default is continuing: </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) In the case of
the occurrence of any Insolvency Event (other than any Insolvency Event
described in subparagraph (vii) of Section 13.6 (Insolvency) of the License
Agreement in which (x) the proceeding is instituted or brought against Licensee
and is not consented to or acquiesced in by Licensee and (y) TDSF or any of its
Affiliates is one of the petitioning creditors instituting such proceeding), the
entire unpaid amount (if any) of the Funding Commitment, any unpaid portion of
the Guaranty Amount and all Direct Obligations shall automatically become
immediately due and payable to TDSF, without presentment, demand, protest or
notice or the necessity of any other action of any kind, all of which are hereby
expressly and irrevocably waived by the Obligors and any Affiliate Guarantors,
and, with respect to the Guaranty Amount, without regard to whether the Obligors
or any Affiliate Guarantors have, prior to or on the date of such Insolvency
Event, contributed to or otherwise invested in Licensee amounts in excess of the
Funding Commitment; <U>provided</U>, that none of such amounts shall so become
immediately due and payable to TDSF if, as of the date of such Insolvency Event,
the License Agreement shall have been terminated by Licensee pursuant to Section
14.1 (Material Breach), 14.2 (Withdrawn or Retired Character Properties), 14.3
(Loss of Use of "<I>Disney</I>" Name) or subparagraph (ii) of Section 14.4
(Uncured Material Breach of Certain Covenants) of the License
Agreement;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) In the case of
the occurrence of any Event of Default other than an Event of Default of a kind
described in subparagraph (i) of this Section 6, TDSF may, by notice to the
Obligors and any Affiliate Guarantors, declare the amount then due under Section
3 hereof with respect to any Guaranteed Obligations, up to the unpaid portion of
the Guaranty Amount, to be immediately due and payable to TDSF and, to the
extent that additional funds are necessary to cure any such License Document
Breach, declare the amount necessary to cure such License Document Breach as
determined by TDSF in its business judgment, up to the remaining balance of the
Funding Commitment, to be immediately due and payable to TDS USA, in each case
without presentment, demand, protest, further notice or the necessity of any
other action of any kind, all of which are hereby expressly and irrevocably
waived by the Obligors and any Affiliate Guarantors; and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) In case any
one or more Events of Default shall have occurred and be continuing, and whether
or not the due dates of any or all of the Obligations shall have been
accelerated, TDSF may draw, as attorney-in-fact for, or otherwise on behalf of,
TDS USA as beneficiary, under any outstanding Approved Letters of Credit and
direct the applicable bank(s) to pay the amount of any such draw directly to TDS
USA, may exercise any and all rights and remedies of a secured creditor (whether
arising by contract, applicable Law or otherwise) with respect to any collateral
security, and/or may proceed to protect and enforce its or Licensee's rights by
suit in equity, action at law or other appropriate proceeding, whether for
monetary damages or any form of equitable relief (including, without limitation,
any temporary restraining order, preliminary injunction, permanent injunction
and specific performance of any covenant or agreement contained in this Guaranty
and Commitment or the License Documents or any instrument pursuant to which any
of the Obligations are evidenced, including as permitted by applicable Law the
obtaining of the appointment of a receiver) and, if any amount shall have become
due, by declaration or otherwise, may proceed to enforce the payment thereof or
any other legal or equitable right of TDSF or Licensee. In the case of any
action or suit by TDSF for equitable relief, the Obligors and any Affiliate
Guarantors acknowledge and agree that money damages may not be an adequate
remedy and that, in such action, TDSF may, in its sole discretion, apply to a
court of competent jurisdiction for a temporary restraining order, a preliminary
injunction, a permanent injunction, specific performance or other form of
equitable relief (without the posting of any bond or other security) as such
court may deem just and proper in order to enforce the applicable provision of
this Guaranty and Commitment or prevent any violation hereof and, to the extent
permitted under applicable Law, the Obligors and any Affiliate Guarantors hereby
waive any objection to the imposition of such relief in any such equitable suit
or action. Any such equitable relief granted in any such equitable suit or
action shall not be exclusive and TDSF shall also be entitled to seek and
enforce any other right or remedy available to it, including money damages.
Notwithstanding the foregoing provisions of this Section 6(iii), in no event
shall the Obligors or any Affiliate Guarantors be required to pay any money
damages in respect of the Guaranteed Obligations to the extent that such money
damages, together with all other Guaranteed Obligations paid by the Obligors and
any Affiliate Guarantors hereunder, would exceed the Guaranty Amount.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 7. <U>Subrogation; Subordination</U>.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) Until the final
payment and performance in full of all of the Guaranteed Obligations, each
Obligor and any Affiliate Guarantor hereby agree not to exercise and hereby
waives any rights against Licensee and/or any other Obligor or Affiliate
Guarantor arising as a result of payment by any Obligor or any Affiliate
Guarantor hereunder, by way of subrogation, reimbursement, restitution,
contribution or otherwise, and will not prove any claim in competition with TDSF
or Licensee in respect of any payment hereunder in any bankruptcy, insolvency or
reorganization case or proceedings of any nature; no Obligor or Affiliate
Guarantor will claim any setoff, recoupment or counterclaim against any other
Obligor or Affiliate Guarantor or Licensee in respect of any liability of any
Obligor or Affiliate Guarantor to any other Obligor or Affiliate Guarantor or to
Licensee; and each Obligor and Affiliate Guarantor (if any) waive any benefit of
and any right to participate in any collateral security that may be held by TDSF
or Licensee.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) The payment of
any amounts due with respect to any Indebtedness of Licensee now or hereafter
owed to the Obligors and any Affiliate Guarantors or by any Obligor or Affiliate
Guarantor to any other Obligor or Affiliate Guarantor is hereby subordinated to
the prior payment in full of all of the Obligations to the extent and with the
effect provided in this Section 7(b). The Obligors and any Affiliate Guarantors
agree that, after the occurrence of any default in the payment or performance of
any of the Obligations, no Obligor or Affiliate Guarantor will demand, sue for
or otherwise attempt to collect any such Indebtedness of any other Obligor or
Affiliate Guarantor or Licensee to such Obligor or Affiliate Guarantor until all
of the Obligations shall have been paid in full. If, notwithstanding the
foregoing sentence, any Obligor or Affiliate Guarantor shall collect, enforce or
receive any amounts in respect of such Indebtedness while any Obligations are
still outstanding and any default in the payment or performance thereof is
continuing, such amounts shall be collected, enforced and received by such
Obligor or Affiliate Guarantor as trustee for TDSF and Licensee and be paid over
to TDSF or TDS USA, as applicable, on account of the Obligations without
affecting in any manner the liability of the Obligors and any Affiliate
Guarantors under the other provisions of this Guaranty and
Commitment.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c) The provisions
of this Section 7 shall be supplemental to and not in derogation of any rights
and remedies of TDSF or Licensee under any separate subordination agreement that
TDSF or Licensee may at any time and from time to time enter into with the
Obligors and/or any Affiliate Guarantors for the benefit of TDSF or
Licensee.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 8.</B>
<B><U>Security; Setoff</U></B><U></U>. Each Obligor and Affiliate Guarantor (if
any) hereby grants to TDSF and Licensee, as security for the full and punctual
payment and performance of all of the Obligations, a continuing lien on and
security interest in all securities or other property belonging to such Obligor
or Affiliate Guarantor now or hereafter held by TDSF or Licensee. Regardless of
the adequacy of any collateral security or other means of obtaining payment of
any of the Obligations, TDSF and Licensee are hereby authorized at any time and
from time to time, without notice to the Obligors or any Affiliate Guarantors
(any such notice being expressly waived by the Obligors and any Affiliate
Guarantors) and to the fullest extent permitted by Law, to set off any funds of
any Obligor or any Affiliate Guarantors held by TDSF or Licensee against the
Obligations, whether or not TDSF or Licensee shall have made any demand under
this Guaranty and Commitment and although such Obligations may be contingent or
unmatured. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 9.</B>
<B><U>Further Assurances; Expenses</U></B><U></U>. Each Obligor and Affiliate
Guarantor (if any) agrees that it will from time to time, at the request of
TDSF, execute any and all further documents or instruments and take such
additional actions as TDSF may deem reasonably necessary or desirable to give
full effect to this Guaranty and Commitment and to perfect and preserve the
rights and powers of TDSF and Licensee hereunder. Each Obligor and Affiliate
Guarantor (if any) acknowledges and confirms that such Obligor or Affiliate
Guarantor itself has established its own adequate means of obtaining from
Licensee on a continuing basis all information desired by each Obligor or
Affiliate Guarantor concerning the financial condition of Licensee and that such
Obligor or Affiliate Guarantor will look to Licensee and not to TDSF in order
for such Obligor or Affiliate Guarantor to keep adequately informed of changes
in Licensee&#146;s financial condition. The Obligors and any Affiliate
Guarantors shall be solely responsible for all costs and expenses arising from
the Obligations and/or the performance of their obligations hereunder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 10.</B>
<B><U>Termination; Reinstatement</U></B><U></U>. This Guaranty and Commitment
shall remain in full force and effect until the Obligations have been fully and
indefeasibly paid in full, notwithstanding any intermediate or temporary payment
or settlement of the whole or any part of the Obligations. In the event that any
Obligor or Affiliate Guarantor gives TDSF notice of its intention to discontinue
this Guaranty and Commitment, such notice (i) shall not be effective unless it
is given in accordance with Section 13 hereof and (ii) shall, if not rescinded
within ten (10) Business Days, result in the occurrence of an Event of Default
under Section 6(d) hereof. In no event (notwithstanding the additional rights of
TDSF and Licensee upon the occurrence of an Event of Default or any actions
taken by either TDSF or Licensee to enforce any such rights or otherwise to
protect its interests hereunder) shall any such notice impair or otherwise
affect any rights of TDSF or Licensee hereunder in any manner whatsoever,
including, without limitation, the rights set forth in Sections 5, 6 and 7, with
respect to any Obligations incurred or accrued prior to such notice or any
Obligations incurred or accrued pursuant to any contract or commitment in
existence prior to such notice, including, without limitation, the maximum
amount of the Funding Commitment and the Guaranteed Obligations for the Initial
Term and any Renewal Term that has commenced prior to such notice. This Guaranty
and Commitment shall continue to be effective or be reinstated, notwithstanding
any such notice or any other event, if at any time any payment made or value
received with respect to any Obligation is rescinded or must otherwise be
returned by TDSF or Licensee upon the insolvency, bankruptcy or reorganization
of Licensee, any Obligor or any Affiliate Guarantor, or otherwise, all as though
such payment had not been made or such value had not been received. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 11.</B>
<B><U>Successors and Assigns</U></B><U></U>. Except in connection with a
Guaranty Assumption in accordance with, and subject to the limitations set forth
in, the License Agreement, none of the Obligors or Affiliate Guarantors shall
Transfer this Guaranty and Commitment, any of the Obligations or any of their
other obligations hereunder. TDSF may Transfer this Guaranty and Commitment, any
of the License Documents and/or any other agreement or note held by TDSF
evidencing, securing or otherwise executed in connection with the Obligations to
any other Person, and such other Person shall thereupon become vested, to the
extent set forth in the agreement evidencing such assignment or transfer, with
all the rights in respect thereof granted to TDSF herein, except to the extent
prohibited by the applicable License Document. This Guaranty and Commitment
shall be binding upon the Obligors, any Affiliate Guarantors and their
respective permitted successors, transferees and assigns, and shall inure to the
benefit of TDSF, Licensee and their respective successors, transferees and
assigns permitted or contemplated by the License Agreement. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 12.</B>
<B><U>Amendments and Waivers</U></B><U></U>. No provision of this Guaranty and
Commitment may be modified, supplemented or amended except by a written
instrument duly executed by each of the Obligors, TDSF and Licensee. Any such
modifications, supplements or amendments shall not require additional
consideration to be effective. No release, discharge or waiver of, nor any
consent to any departure by the Obligors or any Affiliate Guarantors from, any
provision hereof shall be enforceable against or binding upon TDSF or Licensee
unless in writing and executed by a duly authorized officer of each of TDSF and
Licensee. Neither the failure to insist upon strict performance of any of the
agreements, terms, covenants or conditions hereof, nor the acceptance of monies
due hereunder with knowledge of a breach of this Guaranty and Commitment, shall
be deemed a waiver of any rights or remedies that TDSF or Licensee may have or a
waiver of any subsequent breach or default in any of such agreements, terms,
covenants and conditions. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 13.</B>
<B><U>Notices</U></B><U></U>. Unless otherwise specified herein, all notices,
requests, demands, consents and other communications hereunder shall be
transmitted in writing and shall be deemed to have been duly given when hand
delivered, or upon delivery when sent by express mail, courier or other
recognized overnight mail or next day delivery service, charges prepaid, or
three (3) Business Days following the date mailed when sent by registered or
certified United States mail, postage prepaid, return receipt requested, or when
deposited with a public telegraph company for immediate transmittal, charges
prepaid, or when sent by facsimile, with a confirmation copy sent by recognized
overnight mail or next day delivery, charges prepaid, addressed (i) in the case
of TDSF, to TDSF at the addresses or facsimile numbers for notices to TDSF set
forth in Section 21.5 (Notices) of the License Agreement, (ii) in the case of
Licensee, to Licensee at the addresses or facsimile numbers for notices to
Licensee set forth in Section 21.5 (Notices) of the License Agreement, (iii) in
the case of the Obligors or Affiliate Guarantors, to the Obligors and any
Affiliate Guarantors as follows: The Children&#146;s Place Retail Stores, Inc.,
915 Secaucus Road, Secaucus, New Jersey 08540, Facsimile: (201) 558-2837,
Attention: Chief Financial Officer, with copies (which shall not constitute
notice) to The Children&#146;s Place Retail Stores, Inc., 915 Secaucus Road,
Secaucus, New Jersey 08540, Facsimile: (201) 558-2825, Attention: General
Counsel, and to Stroock &amp; Stroock &amp; Lavan LLP, 180 Maiden Lane, New
York, New York 10038, Facsimile (212) 806-6006, Attention: Jeffrey S. Lowenthal,
Esq., or (iv) to such other address or facsimile number as may be designated by
any party hereto by written notice to the others in accordance with this Section
13. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 14.</B>
<B><U>Entire Agreement</U></B><U></U>. The provisions contained in this Guaranty
and Commitment, the Acquisition Agreement, the License Agreement, the other
License Documents and/or any other documents, agreements and instruments
contemplated hereby or thereby or to be executed and delivered in connection
herewith or therewith or pursuant hereto or thereto (including in each case any
annexes, exhibits and schedules thereto) constitute the entire agreement among
the parties hereto with respect to the subject matter hereof and supersede and
replace any and all previous agreements among the parties, whether written or
oral, with respect to such subject matter. No statement or inducement with
respect to the subject matter hereof by any party hereto or by any agent or
representative of any party hereto that is not contained in this Guaranty and
Commitment, the Acquisition Agreement, the License Agreement, the other License
Documents and/or any other documents, agreements and instruments contemplated
hereby or thereby or to be executed and delivered in connection herewith or
therewith or pursuant hereto or thereto shall be valid or binding between the
parties. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 15.</B>
<B><U>Joint and Several Liability of the Obligors; Joint and Several Liability
of the Affiliate Guarantors; Joinder</U></B><U></U>. Notwithstanding anything to
the contrary contained herein, TCP and Licensee Parent shall be jointly and
severally liable for all of the Obligations and all other liabilities, duties
and obligations of TCP, Licensee Parent, the Obligors and/or any Affiliate
Guarantors hereunder without regard to (i) the party or parties to whom this
Guaranty and Commitment allocates any such Obligation or other liability, duty
or obligation or (ii) the party or parties from whose action, omission, breach
or violation any such Obligation or other liability, duty or obligation arises
or on whose action, omission, breach or violation any such Obligation or other
liability, duty or obligation is based. Notwithstanding anything to the contrary
contained herein, all Affiliate Guarantors (if any) shall be jointly and
severally liable under their guarantees of all of the Obligations and all other
liabilities, duties and obligations of TCP, Licensee Parent, the Obligors and/or
any other Affiliate Guarantors hereunder without regard to (i) the party or
parties to whom this Guaranty and Commitment allocates any such Obligation or
other liability, duty or obligation or (ii) the party or parties from whose
action, omission, breach or violation any such Obligation or other liability,
duty or obligation arises or on whose action, omission, breach or violation any
such Obligation or other liability, duty or obligation is based. Each Obligor
and Affiliate Guarantor (if any) acknowledges and agrees that TDSF and/or its
Affiliates shall be entitled to join any or all Obligors and Affiliate
Guarantors as parties to any suit or action by TDSF and/or its Affiliates
against Licensee and/or any of its Affiliates under the License Documents,
whether such suit or action seeks monetary damages, equitable relief or any
other right or remedy available at law, in equity or otherwise and whether such
suit or action is resolved through the Arbitration Procedures or a legal
proceeding submitted for trial pursuant to the terms of the applicable License
Document, and each Obligor and any Affiliate Guarantor hereby waive any
objection that it may now or hereafter have to such joinder. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 16.</B>
<B><U>Governing Law; Cumulative Remedies</U></B><U></U>. Except to the extent
that certain matters may be governed by federal law, this Guaranty and
Commitment shall be deemed to have been entered into in the State of California
and shall be interpreted and construed in accordance with the laws of the State
of California applicable to agreements executed and to be performed therein by
each party hereto. The rights and remedies herein conferred upon TDSF or
Licensee are cumulative and in addition to any other remedies hereunder, under
the License Documents or any other agreement, provided by Law or otherwise
available to TDSF or Licensee at law, in equity or otherwise, and this Guaranty
and Commitment shall be in addition to any other guaranty of or collateral
security for any of the Obligations. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 17.</B>
<B><U>Dispute Resolution; Consent to Jurisdiction; Waiver of Jury
Trial</U></B><U></U>. Each Obligor and Affiliate Guarantor (if any) acknowledges
and agrees that (i) any suit or action by any Obligor or Affiliate Guarantor
with respect to disputes arising under this Guaranty and Commitment shall be
resolved through the dispute resolution procedures set forth in Section 21.23
(Arbitration Procedures) of the License Agreement (the &#147;<B>Arbitration
Procedures</B>&#148;), which Arbitration Procedures are hereby incorporated into
this Guaranty and Commitment as if set forth in full herein with the exception
that references to &#147;Licensee&#148; therein shall be deemed to be references
to the Obligors and any Affiliate Guarantors and references to the
&#147;Agreement&#148; shall be deemed to be references to this Guaranty and
Commitment for purposes of this Guaranty and Commitment, and (ii) in any suit or
action to protect and/or enforce TDSF&#146;s and/or Licensee&#146;s rights under
this Guaranty and Commitment or any other suit or action by TDSF with respect to
disputes arising under this Guaranty and Commitment, TDSF shall be entitled, in
its sole discretion, to seek recourse and remedy through either the Arbitration
Procedures or a legal proceeding submitted for trial before the Superior Court
in and for the County of Los Angeles, State of California, or the United States
District Court for the Central District of California, or if neither such court
shall have jurisdiction, then before any other court sitting in Los Angeles
County, California, having subject matter jurisdiction. Each Obligor and
Affiliate Guarantor (if any) consents to the exclusive jurisdiction of such
courts and to service of process outside of the State of California pursuant to
the requirement of any such court in any matter subject to it and each Obligor
and Affiliate Guarantor (if any) hereby waives any objection that it may now or
hereafter have to the venue of any such suit or any such court or that such suit
was brought in an inconvenient court. <B>EACH OBLIGOR AND AFFILIATE GUARANTOR
(IF ANY) HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR
CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS GUARANTY AND
COMMITMENT, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE PERFORMANCE OF ANY OF
SUCH RIGHTS OR OBLIGATIONS.</B> </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 18.</B>
<B><U>Limitation of Liability</U></B><U></U>.<B> </B>Except as prohibited by
Law, each Obligor and Affiliate Guarantor (if any) hereby waives any right that
it may have to claim or recover in any dispute arising under this Guaranty and
Commitment any punitive, exemplary, consequential, incidental, indirect, special
or speculative damages (including loss of profits). The Obligors and any
Affiliate Guarantors (a)&#160;certify that neither TDSF nor any Representative
of TDSF has represented, expressly or otherwise, that TDSF would not, in the
event of any such dispute, seek to enforce the foregoing waivers and
(b)&#160;acknowledge that, in entering into the License Documents, TDSF is
relying upon, among other things, the waivers and certifications contained in
this Section 18. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Section 19.</B>
<B><U>Miscellaneous</U></B><U></U>. Except to the extent such provisions would
conflict with the express provisions hereof or be inapplicable hereto, the
provisions contained in Sections 17 (Public Disclosure; Confidentiality), 21.7
(Joint Venture/Partnership Disclaimer), 21.8 (Accord and Satisfaction), 21.9
(Relationship of Parties), 21.10 (Effect of Headings), 21.11 (Construction),
21.13 (Severability), 21.15 (Counterparts; Facsimile Signatures), 21.17 (No
Third Party Beneficiaries), 21.19 (Conflicts of Interest), 21.20 (Interest) and
21.27 (Rules of Interpretation) of the License Agreement are hereby incorporated
into this Guaranty and Commitment as if set forth in full herein, with the
exception that references to &#147;Licensee&#148; therein shall be deemed to be
references to the Obligors and Affiliate Guarantors (if any) and references to
the &#147;Agreement&#148; shall be deemed to be references to this Guaranty and
Commitment for purposes of this Guaranty and Commitment. </FONT></P>

<PAGE>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>IN WITNESS WHEREOF</B>, the Obligors have caused this Guaranty and Commitment
to be executed and delivered as of the date first above written. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%><BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>
<BR>ACKNOWLEDGED AND AGREED<BR>
<BR>
TDS FRANCHISING, LLC<BR>
a California limited liability company<BR>
<BR>
<BR>
By: <U>/s/ David K. Thompson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:&nbsp;&nbsp;&nbsp;David K. Thompson<BR>
Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior Vice President<BR>
<BR>
<BR>
By: <U>/s/ James M. Kapenstein&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:&nbsp;&nbsp;&nbsp;James M. Kapenstein<BR>
Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vice President<BR>
<BR>
<BR>
THE DISNEY STORE, LLC<BR>
a California limited liability company<BR>
<BR>
<BR>
By: <U>/s/ Steven Balasiano&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:&nbsp;&nbsp;&nbsp;Steven Balasiano<BR>
Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior Vice President<BR>
<BR>
<BR>
By: <U>/s/ Seth Udasin&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:&nbsp;&nbsp;&nbsp;Seth Udasin<BR>
Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasurer<BR>
<BR>
<BR>
THE DISNEY STORE (CANADA) LTD.
<BR>
<BR>
By: <U>/s/ Steven Balasiano&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:&nbsp;&nbsp;&nbsp;Steven Balasiano<BR>
Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior Vice President</TD>
<TD WIDTH=50%>THE CHILDREN'S PLACE RETAIL STORES, INC.<BR>
<BR>
<BR>
By: <U>/s/ Seth Udasin&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:&nbsp;&nbsp;&nbsp;Seth Udasin<BR>
Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vice President and Treasurer<BR>
<BR>
<BR>
HOOP HOLDINGS, LLC
<BR>
<BR>
By: <U>/s/ Seth Udasin&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Name:&nbsp;&nbsp;&nbsp;Seth Udasin<BR>
Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Treasurer<BR>
<BR>
</TD>
</TR>
</TABLE>
<BR>


</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>6
<FILENAME>childrens-ex106_120904.htm
<DESCRIPTION>EX-10.6
<TEXT>
<HTML>
<HEAD>
<TITLE>Ex-10.6</TITLE>
</HEAD>
<BODY>

<P ALIGN=CENTER><B>LOAN AND SECURITY AGREEMENT</B><BR><BR>

WELLS FARGO RETAIL FINANCE, LLC<BR><BR>

Agent for<BR><BR>

The Lenders Referenced Herein<BR><BR><BR>

CONGRESS FINANCIAL CORPORATION (NEW ENGLAND),<BR>
as Documentation Agent<BR><BR>

and<BR><BR>

LASALLE RETAIL FINANCE, A DIVISION OF LASALLE BUSINESS CREDIT, LLC<BR>
as Co-Agent<BR><BR><BR>

THE DISNEY STORE, LLC<BR><BR>

The Lead Borrower<BR><BR>

For:<BR><BR>

THE DISNEY STORE, LLC<BR><BR>

HOOP RETAIL STORES, LLC<BR><BR>

The Borrowers<BR><BR><BR>

HOOP CANADA HOLDINGS, INC.<BR><BR>

The Guarantor<BR><BR>

HOOP CANADA, INC.<BR>
THE DISNEY STORE (CANADA) LTD.<BR><BR>

The Secondary Guarantors<BR><BR>

November 21, 2004</P>

<PAGE>

<P ALIGN=LEFT><FONT SIZE=3>TABLE OF CONTENTS</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 1 Definitions:</TD>
<TD WIDTH=20%>10</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 2 The Revolving Credit:</TD>
<TD WIDTH=20%>29</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.1.</TD>
<TD WIDTH=70%>Establishment of  Revolving Credit</TD>
<TD WIDTH=20%>29</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.2.</TD>
<TD WIDTH=70%>Advances in Excess of Borrowing Base (OverLoans)</TD>
<TD WIDTH=20%>29</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.3.</TD>
<TD WIDTH=70%>Risks of Value of Collateral</TD>
<TD WIDTH=20%>30</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.4.</TD>
<TD WIDTH=70%>Commitment to Make Revolving Credit Loans and Support Letters of
Credit</TD>
<TD WIDTH=20%>30</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.5.</TD>
<TD WIDTH=70%>Revolving Credit Loan Requests</TD>
<TD WIDTH=20%>30</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.6.</TD>
<TD WIDTH=70%>Suspension of Revolving Credit</TD>
<TD WIDTH=20%>31</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.7.</TD>
<TD WIDTH=70%>Making of Revolving Credit Loans</TD>
<TD WIDTH=20%>31</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.8.</TD>
<TD WIDTH=70%>The Loan Account</TD>
<TD WIDTH=20%>32</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.9.</TD>
<TD WIDTH=70%>The Revolving Credit Notes</TD>
<TD WIDTH=20%>33</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.10.</TD>
<TD WIDTH=70%>Payment of The Loan Account</TD>
<TD WIDTH=20%>33</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.11.</TD>
<TD WIDTH=70%>Interest on Revolving Credit Loans</TD>
<TD WIDTH=20%>33</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.12.</TD>
<TD WIDTH=70%>Revolving Credit Closing Fee</TD>
<TD WIDTH=20%>34</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.13.</TD>
<TD WIDTH=70%>Unused Line Fee</TD>
<TD WIDTH=20%>34</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.14.</TD>
<TD WIDTH=70%>Early Termination Fee</TD>
<TD WIDTH=20%>34</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.15.</TD>
<TD WIDTH=70%>Monitoring Fee</TD>
<TD WIDTH=20%>35</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.16.</TD>
<TD WIDTH=70%>Concerning Fees</TD>
<TD WIDTH=20%>35</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.17.</TD>
<TD WIDTH=70%>Agent's and Revolving Credit Lenders' Discretion</TD>
<TD WIDTH=20%>35</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.18.</TD>
<TD WIDTH=70%>Procedures For Issuance of L/C's</TD>
<TD WIDTH=20%>36</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.19.</TD>
<TD WIDTH=70%>Fees For L/C's</TD>
<TD WIDTH=20%>37</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.20.</TD>
<TD WIDTH=70%>Concerning L/C's</TD>
<TD WIDTH=20%>37</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.21.</TD>
<TD WIDTH=70%>Changed Circumstances</TD>
<TD WIDTH=20%>38</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.22.</TD>
<TD WIDTH=70%>Designation of Lead Borrower as Borrowers' Agent</TD>
<TD WIDTH=20%>39</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>2.23</TD>
<TD WIDTH=70%>Lenders' Commitments</TD>
<TD WIDTH=20%>39</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 3 Conditions Precedent:</TD>
<TD WIDTH=20%>40</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.1.</TD>
<TD WIDTH=70%>Corporate Due Diligence</TD>
<TD WIDTH=20%>41</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.2.</TD>
<TD WIDTH=70%>Opinion</TD>
<TD WIDTH=20%>41</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.3.</TD>
<TD WIDTH=70%>Additional Documents and Information</TD>
<TD WIDTH=20%>41</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.4.</TD>
<TD WIDTH=70%>Officers' Certificates</TD>
<TD WIDTH=20%>41</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.5.</TD>
<TD WIDTH=70%>Representations and Warranties</TD>
<TD WIDTH=20%>42</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.6.</TD>
<TD WIDTH=70%>Minimum Day One Availability</TD>
<TD WIDTH=20%>42</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.7.</TD>
<TD WIDTH=70%>All Fees and Expenses Paid</TD>
<TD WIDTH=20%>42</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.8.</TD>
<TD WIDTH=70%>No Borrower In Default</TD>
<TD WIDTH=20%>42</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.9.</TD>
<TD WIDTH=70%>No Adverse Change</TD>
<TD WIDTH=20%>42</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>3.10.</TD>
<TD WIDTH=70%>Benefit of Conditions Precedent</TD>
<TD WIDTH=20%>42</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 4 General Representations, Covenants and Warranties:</TD>
<TD WIDTH=20%>42</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.1.</TD>
<TD WIDTH=70%>Payment and Performance of Liabilities</TD>
<TD WIDTH=20%>43</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.2.</TD>
<TD WIDTH=70%>Due Organization. Authorization. No Conflicts</TD>
<TD WIDTH=20%>43</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.3.</TD>
<TD WIDTH=70%>Trade Names</TD>
<TD WIDTH=20%>43</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.4.</TD>
<TD WIDTH=70%>Infrastructure</TD>
<TD WIDTH=20%>44</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.5.</TD>
<TD WIDTH=70%>Locations</TD>
<TD WIDTH=20%>44</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.6.</TD>
<TD WIDTH=70%>Encumbrances</TD>
<TD WIDTH=20%>44</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.7.</TD>
<TD WIDTH=70%>Indebtedness</TD>
<TD WIDTH=20%>45</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.8.</TD>
<TD WIDTH=70%>Insurance</TD>
<TD WIDTH=20%>45</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.9.</TD>
<TD WIDTH=70%>Licenses</TD>
<TD WIDTH=20%>46</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.10.</TD>
<TD WIDTH=70%>Leases</TD>
<TD WIDTH=20%>46</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.11.</TD>
<TD WIDTH=70%>Requirements of Law</TD>
<TD WIDTH=20%>46</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.12.</TD>
<TD WIDTH=70%>Labor Relations</TD>
<TD WIDTH=20%>46</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.13.</TD>
<TD WIDTH=70%>Maintain Properties</TD>
<TD WIDTH=20%>47</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.14.</TD>
<TD WIDTH=70%>Taxes</TD>
<TD WIDTH=20%>47</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.15.</TD>
<TD WIDTH=70%>No Margin Stock</TD>
<TD WIDTH=20%>48</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.16.</TD>
<TD WIDTH=70%>ERISA</TD>
<TD WIDTH=20%>48</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.17.</TD>
<TD WIDTH=70%>Hazardous Materials</TD>
<TD WIDTH=20%>48</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.18.</TD>
<TD WIDTH=70%>Litigation</TD>
<TD WIDTH=20%>49</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.19.</TD>
<TD WIDTH=70%>Dividends. Investments. Corporate Action</TD>
<TD WIDTH=20%>49</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.20.</TD>
<TD WIDTH=70%>Loans</TD>
<TD WIDTH=20%>49</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.21.</TD>
<TD WIDTH=70%>Protection of Assets</TD>
<TD WIDTH=20%>50</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.22.</TD>
<TD WIDTH=70%>Line of Business</TD>
<TD WIDTH=20%>50</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.23.</TD>
<TD WIDTH=70%>Affiliate Transactions</TD>
<TD WIDTH=20%>50</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.24.</TD>
<TD WIDTH=70%>Executive Pay</TD>
<TD WIDTH=20%>50</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.25.</TD>
<TD WIDTH=70%>Further Assurances</TD>
<TD WIDTH=20%>50</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.26.</TD>
<TD WIDTH=70%>Adequacy of Disclosure</TD>
<TD WIDTH=20%>51</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.27.</TD>
<TD WIDTH=70%>No Restrictions on Liabilities</TD>
<TD WIDTH=20%>51</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>4.28.</TD>
<TD WIDTH=70%>Other Covenants</TD>
<TD WIDTH=20%>51</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 5 Financial Reporting and Performance Covenants:</TD>
<TD WIDTH=20%>52</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.1.</TD>
<TD WIDTH=70%>Maintain Records</TD>
<TD WIDTH=20%>52</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.2.</TD>
<TD WIDTH=70%>Access to Records</TD>
<TD WIDTH=20%>52</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.3.</TD>
<TD WIDTH=70%>Immediate Notice to Agent</TD>
<TD WIDTH=20%>52</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.4.</TD>
<TD WIDTH=70%>Borrowing Base Certificate</TD>
<TD WIDTH=20%>53</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.5.</TD>
<TD WIDTH=70%>Weekly Reports</TD>
<TD WIDTH=20%>53</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.6.</TD>
<TD WIDTH=70%>Monthly Reports</TD>
<TD WIDTH=20%>53</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.7.</TD>
<TD WIDTH=70%>Annual Reports</TD>
<TD WIDTH=20%>53</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.8.</TD>
<TD WIDTH=70%>Officers' Certificates</TD>
<TD WIDTH=20%>54</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.9.</TD>
<TD WIDTH=70%>Inventories, Appraisals, and Audits</TD>
<TD WIDTH=20%>54</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.10.</TD>
<TD WIDTH=70%>Additional Financial Information</TD>
<TD WIDTH=20%>55</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>5.11.</TD>
<TD WIDTH=70%>Financial Performance Covenants</TD>
<TD WIDTH=20%>56</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 6 Use of Collateral:</TD>
<TD WIDTH=20%>56</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>6.1.</TD>
<TD WIDTH=70%>Use of  Inventory Collateral</TD>
<TD WIDTH=20%>56</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>6.2.</TD>
<TD WIDTH=70%>Inventory Quality</TD>
<TD WIDTH=20%>56</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>6.3.</TD>
<TD WIDTH=70%>Adjustments and Allowances</TD>
<TD WIDTH=20%>56</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>6.4.</TD>
<TD WIDTH=70%>Validity of Accounts</TD>
<TD WIDTH=20%>56</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>6.5.</TD>
<TD WIDTH=70%>Notification to Account Debtors</TD>
<TD WIDTH=20%>57</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 7 Cash Management. Payment of Liabilities:</TD>
<TD WIDTH=20%>57</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>7.1.</TD>
<TD WIDTH=70%>The Blocked, and Operating Accounts</TD>
<TD WIDTH=20%>57</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>7.2.</TD>
<TD WIDTH=70%>Proceeds and Collections</TD>
<TD WIDTH=20%>57</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>7.3.</TD>
<TD WIDTH=70%>Payment of Liabilities</TD>
<TD WIDTH=20%>58</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>7.4.</TD>
<TD WIDTH=70%>The Operating Account</TD>
<TD WIDTH=20%>58</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 8 Grant of Security Interest:</TD>
<TD WIDTH=20%>58</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>8.1.</TD>
<TD WIDTH=70%>Grant of Security Interest</TD>
<TD WIDTH=20%>59</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>8.2.</TD>
<TD WIDTH=70%>Extent and Duration of Security Interest</TD>
<TD WIDTH=20%>59</TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 9 Agent As Borrowers' Attorney-In-Fact:</TD>
<TD WIDTH=20%>60</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>9.1.</TD>
<TD WIDTH=70%>Appointment as Attorney-In-Fact</TD>
<TD WIDTH=20%>60</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>9.2.</TD>
<TD WIDTH=70%>No Obligation to Act</TD>
<TD WIDTH=20%>60</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 10 Events of Default:</TD>
<TD WIDTH=20%>60</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.1.</TD>
<TD WIDTH=70%>Failure to Pay the Revolving Credit</TD>
<TD WIDTH=20%>61</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.2.</TD>
<TD WIDTH=70%>Failure To Make Other Payments</TD>
<TD WIDTH=20%>61</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.3.</TD>
<TD WIDTH=70%>Failure to Perform Covenant or Liability (No Grace Period)</TD>
<TD WIDTH=20%>61</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.4.</TD>
<TD WIDTH=70%>Failure to Perform Covenant or Liability (Grace Period)</TD>
<TD WIDTH=20%>61</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.5.</TD>
<TD WIDTH=70%>Misrepresentation</TD>
<TD WIDTH=20%>61</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.6.</TD>
<TD WIDTH=70%>Acceleration of Other Debt. Breach of Other Agreements</TD>
<TD WIDTH=20%>61</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.7.</TD>
<TD WIDTH=70%>Default Under Other Agreements</TD>
<TD WIDTH=20%>61</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.8.</TD>
<TD WIDTH=70%>Uninsured Casualty Loss</TD>
<TD WIDTH=20%>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.9.</TD>
<TD WIDTH=70%>Attachment. Judgment. Restraint of Business</TD>
<TD WIDTH=20%>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.10.</TD>
<TD WIDTH=70%>Business Failure</TD>
<TD WIDTH=20%>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.11.</TD>
<TD WIDTH=70%>Bankruptcy</TD>
<TD WIDTH=20%>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.12.</TD>
<TD WIDTH=70%>Indictment - Forfeiture</TD>
<TD WIDTH=20%>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.13.</TD>
<TD WIDTH=70%>Guarantor's Default</TD>
<TD WIDTH=20%>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.14.</TD>
<TD WIDTH=70%>Termination of Guaranty</TD>
<TD WIDTH=20%>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.15.</TD>
<TD WIDTH=70%>Challenge to Loan Documents</TD>
<TD WIDTH=20%>62</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.16.</TD>
<TD WIDTH=70%>Key Management</TD>
<TD WIDTH=20%>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>10.17.</TD>
<TD WIDTH=70%>Change in Control</TD>
<TD WIDTH=20%>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 11 Rights and Remedies Upon Default:</TD>
<TD WIDTH=20%>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>11.1.</TD>
<TD WIDTH=70%>Acceleration</TD>
<TD WIDTH=20%>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>11.2.</TD>
<TD WIDTH=70%>Rights of Enforcement</TD>
<TD WIDTH=20%>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>11.3.</TD>
<TD WIDTH=70%>Sale of Collateral</TD>
<TD WIDTH=20%>63</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>11.4.</TD>
<TD WIDTH=70%>Occupation of Business Location</TD>
<TD WIDTH=20%>64</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>11.5.</TD>
<TD WIDTH=70%>Grant of Nonexclusive License</TD>
<TD WIDTH=20%>64</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>11.6.</TD>
<TD WIDTH=70%>Assembly of Collateral</TD>
<TD WIDTH=20%>64</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>11.7.</TD>
<TD WIDTH=70%>Rights and Remedies</TD>
<TD WIDTH=20%>64</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 12 Cure and Reinstatement Rights:</TD>
<TD WIDTH=20%>65</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>12.1.</TD>
<TD WIDTH=70%>Financially Curable Defaults</TD>
<TD WIDTH=20%>65</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>12.2.</TD>
<TD WIDTH=70%>Non-Curable Defaults</TD>
<TD WIDTH=20%>65</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>12.3.</TD>
<TD WIDTH=70%>Other Defaults</TD>
<TD WIDTH=20%>65</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>12.4.</TD>
<TD WIDTH=70%>Pending Cure; Failure to Cure</TD>
<TD WIDTH=20%>66</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>12.5.</TD>
<TD WIDTH=70%>Limitation on Cure Rights</TD>
<TD WIDTH=20%>66</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 13 Revolving Credit Fundings and Distributions:</TD>
<TD WIDTH=20%>66</TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>13.1.</TD>
<TD WIDTH=70%>Revolving Credit Funding Procedures</TD>
<TD WIDTH=20%>66</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>13.2.</TD>
<TD WIDTH=70%>Agent's Covering of Fundings</TD>
<TD WIDTH=20%>67</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>13.3.</TD>
<TD WIDTH=70%>Ordinary Course Distributions</TD>
<TD WIDTH=20%>68</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 14 Acceleration and Liquidation:</TD>
<TD WIDTH=20%>69</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>14.1.</TD>
<TD WIDTH=70%>Acceleration Notices</TD>
<TD WIDTH=20%>69</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>14.2.</TD>
<TD WIDTH=70%>Acceleration</TD>
<TD WIDTH=20%>69</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>14.3.</TD>
<TD WIDTH=70%>Initiation of Liquidation</TD>
<TD WIDTH=20%>69</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>14.4.</TD>
<TD WIDTH=70%>Actions At and  Following Initiation of Liquidation</TD>
<TD WIDTH=20%>69</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>14.5.</TD>
<TD WIDTH=70%>Agent's Conduct of Liquidation</TD>
<TD WIDTH=20%>69</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>14.6.</TD>
<TD WIDTH=70%>Distribution of Liquidation Proceeds</TD>
<TD WIDTH=20%>70</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>14.7.</TD>
<TD WIDTH=70%>Relative Priorities To Proceeds of Liquidation</TD>
<TD WIDTH=20%>70</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 15 The Agent:</TD>
<TD WIDTH=20%>71</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.1.</TD>
<TD WIDTH=70%>Appointment of The Agent</TD>
<TD WIDTH=20%>71</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.2.</TD>
<TD WIDTH=70%>Responsibilities of Agent</TD>
<TD WIDTH=20%>71</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.3.</TD>
<TD WIDTH=70%>Concerning Distributions By the Agent</TD>
<TD WIDTH=20%>72</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.4.</TD>
<TD WIDTH=70%>Dispute Resolution</TD>
<TD WIDTH=20%>72</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.5.</TD>
<TD WIDTH=70%>Distributions of Notices and Other Documents</TD>
<TD WIDTH=20%>73</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.6.</TD>
<TD WIDTH=70%>Confidential Information</TD>
<TD WIDTH=20%>73</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.7.</TD>
<TD WIDTH=70%>Reliance by Agent</TD>
<TD WIDTH=20%>73</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.8.</TD>
<TD WIDTH=70%>Non-Reliance on Agent and Other Revolving Credit Lenders</TD>
<TD WIDTH=20%>73</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.9.</TD>
<TD WIDTH=70%>Indemnification</TD>
<TD WIDTH=20%>74</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.10.</TD>
<TD WIDTH=70%>Resignation of Agent</TD>
<TD WIDTH=20%>74</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>15.11.</TD>
<TD WIDTH=70%>Documentation Agent; Co-Agent</TD>
<TD WIDTH=20%>75</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 16 Action By Agents - Consents - Amendments - Waivers:</TD>
<TD WIDTH=20%>75</TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.1.</TD>
<TD WIDTH=70%>Administration of Credit Facilities</TD>
<TD WIDTH=20%>75</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.2.</TD>
<TD WIDTH=70%>Actions Requiring or On Direction of Majority Lenders</TD>
<TD WIDTH=20%>76</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.3.</TD>
<TD WIDTH=70%>Actions Requiring or On Direction of SuperMajority Lenders</TD>
<TD WIDTH=20%>76</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.4.</TD>
<TD WIDTH=70%>Action Requiring Certain Consent</TD>
<TD WIDTH=20%>76</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.5.</TD>
<TD WIDTH=70%>Actions Requiring or Directed By Unanimous Consent</TD>
<TD WIDTH=20%>77</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.6.</TD>
<TD WIDTH=70%>Actions Requiring Agent's Consent</TD>
<TD WIDTH=20%>78</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.7.</TD>
<TD WIDTH=70%>Miscellaneous Actions</TD>
<TD WIDTH=20%>78</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.8.</TD>
<TD WIDTH=70%>Actions Requiring Lead Borrower's Consent</TD>
<TD WIDTH=20%>78</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>16.9.</TD>
<TD WIDTH=70%>NonConsenting Revolving Credit Lender</TD>
<TD WIDTH=20%>79</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 17 Assignments By Revolving Credit Lenders:</TD>
<TD WIDTH=20%>80</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>17.1.</TD>
<TD WIDTH=70%>Assignments and Assumptions</TD>
<TD WIDTH=20%>80</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>17.2.</TD>
<TD WIDTH=70%>Assignment Procedures</TD>
<TD WIDTH=20%>80</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>17.3.</TD>
<TD WIDTH=70%>Effect of Assignment</TD>
<TD WIDTH=20%>81</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 18 Notices:</TD>
<TD WIDTH=20%>81</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>18.1.</TD>
<TD WIDTH=70%>Notice Addresses</TD>
<TD WIDTH=20%>81</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>18.2.</TD>
<TD WIDTH=70%>Notice Given</TD>
<TD WIDTH=20%>83</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>18.3.</TD>
<TD WIDTH=70%>Wire Instructions. Notice Given</TD>
<TD WIDTH=20%>83</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 19 Term:</TD>
<TD WIDTH=20%>83</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>19.1.</TD>
<TD WIDTH=70%>Termination of Revolving Credit</TD>
<TD WIDTH=20%>83</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>19.2.</TD>
<TD WIDTH=70%>Actions On Termination</TD>
<TD WIDTH=20%>83</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=80% ALIGN=LEFT>Article 20 General:</TD>
<TD WIDTH=20%>84</TD>
</TR>
</TABLE>
<BR>




<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.1.</TD>
<TD WIDTH=70%>Protection of Collateral</TD>
<TD WIDTH=20%>84</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.2.</TD>
<TD WIDTH=70%>Publicity</TD>
<TD WIDTH=20%>84</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.3.</TD>
<TD WIDTH=70%>Successors and Assigns</TD>
<TD WIDTH=20%>84</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.4.</TD>
<TD WIDTH=70%>Severability</TD>
<TD WIDTH=20%>84</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.5.</TD>
<TD WIDTH=70%>Amendments.  Course of Dealing</TD>
<TD WIDTH=20%>84</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.6.</TD>
<TD WIDTH=70%>Power of Attorney</TD>
<TD WIDTH=20%>85</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.7.</TD>
<TD WIDTH=70%>Application of Proceeds</TD>
<TD WIDTH=20%>85</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.8.</TD>
<TD WIDTH=70%>Increased Costs</TD>
<TD WIDTH=20%>85</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.9.</TD>
<TD WIDTH=70%>Costs and Expenses of the Agent</TD>
<TD WIDTH=20%>86</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.10.</TD>
<TD WIDTH=70%>Copies and Facsimiles</TD>
<TD WIDTH=20%>86</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.11.</TD>
<TD WIDTH=70%>Massachusetts Law</TD>
<TD WIDTH=20%>86</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.12.</TD>
<TD WIDTH=70%>Consent to Jurisdiction</TD>
<TD WIDTH=20%>86</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.13.</TD>
<TD WIDTH=70%>Indemnification</TD>
<TD WIDTH=20%>87</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.14.</TD>
<TD WIDTH=70%>Rules of Construction</TD>
<TD WIDTH=20%>87</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.15.</TD>
<TD WIDTH=70%>Intent</TD>
<TD WIDTH=20%>88</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.16.</TD>
<TD WIDTH=70%>Right of Set-Off</TD>
<TD WIDTH=20%>89</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.17.</TD>
<TD WIDTH=70%>Pledges To Federal Reserve Banks</TD>
<TD WIDTH=20%>89</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.18.</TD>
<TD WIDTH=70%>Maximum Interest Rate</TD>
<TD WIDTH=20%>89</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=5%>20.19.</TD>
<TD WIDTH=70%>Waivers</TD>
<TD WIDTH=20%>89</TD>
</TR>
</TABLE>
<BR>
<BR>
<BR>
<BR>
<P ALIGN=CENTER><B>EXHIBITS</B></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>2.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Revolving Credit Note</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>2.23&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Revolving Credit Lenders' Commitments</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>4.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Affiliates</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>4.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Trade Names</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>4.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Indebtedness</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>4.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Capital Leases</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>4.14&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Taxes</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>4.18&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Litigation</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>5.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Borrowing Base Certificate</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>5.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Monthly Financial Reporting Requirements</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>5.11(a):</TD>
<TD WIDTH=85%>Financial Performance Covenants</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>5.11(b):</TD>
<TD WIDTH=85%>Business Plan</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=10%>16.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;:</TD>
<TD WIDTH=85%>Assignment / Assumption</TD>
</TR>
</TABLE>
<BR>

<PAGE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=45% ALIGN=LEFT>LOAN AND SECURITY AGREEMENT</TD>
<TD WIDTH=5%></TD>
<TD WIDTH=45% ALIGN=RIGHT>Wells Fargo Retail Finance, LLC, Agent</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=RIGHT>November 21,  2004</P>

<P ALIGN=LEFT><FONT SIZE=3>THIS AGREEMENT is made between</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Wells Fargo Retail Finance, LLC (in such capacity, herein the
&#147;<B>Agent</B>&#148;), a Delaware limited liability company with offices at
One Boston Place - - 18<SUP>th</SUP> Floor, Boston, Massachusetts 02109, as
agent for the ratable benefit of the &#147;<B>Revolving Credit
Lenders</B>&#148;, who are, at present, those financial institutions identified
on the signature pages of this Agreement and who in the future are those Persons
(if any) who become &#147;Revolving Credit Lenders&#148; in accordance with the
provisions of Article 17, below;</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
and</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Revolving Credit Lenders;</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
and</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Disney Store, LLC ( in such capacity, the &#147;<B>Lead Borrower</B>&#148;),
a California limited liability company with its principal executive offices at
c/o The Children's Place Retail Stores, Inc., 915 Secaucus Road, Secaucus, New
Jersey 07094, as agent for the following (individually, a
<B>&#147;Borrower</B>&#148; and collectively, the &#147;<B>Borrowers</B>&#148;):</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Disney Store, LLC, a California limited liability company with its principal
executive offices at c/o The Children's Place Retail Stores, Inc., 915 Secaucus
Road, Secaucus, New Jersey 07094; and</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Hoop Retail Stores, LLC, a Delaware limited liability company with its principal
executive offices at c/o The Children's Place Retail Stores, Inc., 915 Secaucus
Road, Secaucus, New Jersey 07094,</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>in consideration of the mutual covenants contained
herein and benefits to be derived herefrom,</FONT></P>

<P ALIGN=CENTER>WITNESSETH:</P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 1 - Definitions:</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As used herein, the following terms have the following meanings or are defined
in the section of this Agreement so indicated:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Acceleration</B>&#148;: The making of demand or declaration that any
indebtedness, not otherwise due and payable, is due and payable. Derivations of
the word &#147;Acceleration&#148; (such as &#147;Accelerate&#148;) are used with
like meaning in this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Acceleration Notice</B>": Written notice as follows:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) From the Agent to the Revolving
Credit Lenders, as provided in Section 14.1(a).
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) From the SuperMajority Lenders
to the Agent, as provided in Section 14.1(b).
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Account Debtor</B>": Has the meaning given that term in the UCC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Accounts</B>&#148; and &#147;<B>Accounts Receivable</B>&#148; include,
without limitation, &#147;accounts&#148; as defined in the UCC, and also all:
accounts, accounts receivable, receivables, and rights to payment (whether or
not earned by performance) for: property that has been or is to be sold, leased,
licensed, assigned, or otherwise disposed of; services rendered or to be
rendered; a policy of insurance issued or to be issued; a secondary obligation
incurred or to be incurred; energy provided or to be provided; for the use or
hire of a vessel; arising out of the use of a credit or charge card or
information contained on or used with that card; winnings in a lottery or other
game of chance; and also all Inventory which gave rise thereto, and all rights
associated with such Inventory, including the right of stoppage in transit; all
reclaimed, returned, rejected or repossessed Inventory (if any) the sale of
which gave rise to any Account.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>ACH</B>": Automated clearing house.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Acquisition Agreement</B>": That certain Acquisition Agreement dated as of October
19, 2004 entered into by and among Affiliates of the Borrowers, The Children's
Place Retail Stores, Inc., as guarantor, and certain of the Walt Disney
Companies.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Affiliate</B>": The following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) With respect to any two Persons,
a relationship in which (i) one holds, directly or indirectly, not less than
Twenty Five Percent (25%) of the capital stock, beneficial interests,
partnership interests, or other equity interests of the other; or (ii) one has,
directly or indirectly, the right, under ordinary circumstances, to vote for the
election of a majority of the directors (or other body or Person who has those
powers customarily vested in a board of directors of a corporation); or (iii)
not less than Twenty Five Percent (25%) of their respective ownership is
directly or indirectly held by the same third Person.
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) Any Person which: is a parent,
brother-sister, subsidiary, or affiliate, of a Borrower; could have such
enterprise's tax returns or financial statements consolidated with that
Borrower's; could be a member of the same controlled group of corporations
(within the meaning of Section 1563(a)(1), (2) and (3) of the Internal Revenue
Code of 1986, as amended from time to time) of which any Borrower is a member;
or controls or is controlled by any Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Agent</B>": Is referred to in the Preamble.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Agent's  Cover</B>": Defined in Section 13.2(c)(i).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Agent's Rights and Remedies</B>": Is defined in Section 11.7.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Applicable Law</B>&#148;: As to any Person: (i) All statutes, rules,
regulations, orders, or other requirements having the force of law and (ii) all
court orders and injunctions, arbitrator&#146;s decisions, and/or similar
rulings, in each instance ((i) and (ii)) of or by any federal, state, municipal,
and other governmental authority, or court, tribunal, panel, or other body which
has or claims jurisdiction over such Person, or any property of such Person, or
of any other Person for whose conduct such Person would be responsible.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Assigning Revolving Credit Lender</B>": Defined in Section 17.1(a).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Assignment and Acceptance</B>": Defined in Section 17.2.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Availability</B>": The result of the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) The lesser of</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=77%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(A) The Revolving Credit Ceiling</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
or</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(B) The Borrowing Base</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Minus</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) The aggregate unpaid balance of the Loan Account.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Minus</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) The aggregate undrawn Stated Amount of all then outstanding L/C's.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Minus</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) The aggregate of the Availability Reserves</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Minus</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(v) The Minimum Reserve.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Availability Reserves</B>&#148;: Such reserves as the Agent from time
to time determines in the Agent&#146;s discretion as being appropriate to
reflect the impediments to the Agent&#146;s ability to realize upon the
Collateral. Without limiting the generality of the foregoing, Availability
Reserves may include (but are not limited to) reserves based on the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Rent (but only if a landlord's waiver, acceptable to the Agent, has not been
received by the Agent with respect to each of the Borrowers' retail locations in
Virginia, Pennsylvania, and Washington) in an amount equal to one month's rent
for each such location .</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Customer Credit Liabilities.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) Bank Product Reserves.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) Taxes and other governmental charges, including, ad valorem, personal
property, and other taxes which might have priority over the Collateral
Interests of the Agent in the Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(v) L/C Landing Costs.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(vi) Royalty payments due to the Walt Disney Companies under the Disney License
Agreement, initially set at an amount equal to approximately One (1) month's
royalty payment.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>&#147;Average Excess Availability&#148;</B>: Means, for the subject period,
the aggregate of the amount of Availability on each day in the period, divided
by the number of days in the subject period.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Bank Product Agreements</B>&#148; means those certain cash management
service agreements entered into from time to time by the Borrower in connection
with any of the Bank Products.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Bank Product Obligations</B>&#148; means all obligations, liabilities,
contingent reimbursement obligations, fees, and expenses owing by the Borrower
to the Lenders, the Agent, Wells Fargo Bank, N.A., or any of their respective
Affiliates pursuant to or evidenced by the Bank Product Agreements and
irrespective of whether for the payment of money, whether direct or indirect,
absolute or contingent, due or to become due, now existing or hereafter arising,
and including all such amounts that the Borrower is obligated to reimburse to
the Agent, the Lenders or any of their respective Affiliates as a result of the
Agent purchasing participations or executing indemnities or reimbursement
obligations with respect to the Bank Products provided to the Borrower pursuant
to the Bank Product Agreements.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Bank Products</B>&#148; means any service or facility extended to the
Borrower by the Lenders, the Agent, Wells Fargo Bank, N. A. or any of their
respective Affiliates: (a) credit cards, (b) credit card processing services,
(c) debit cards, (d) purchase cards, (e) ACH Transactions, (f) cash management,
including controlled disbursement, accounts or services, or (g) hedge
agreements.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Bank Product Reserves</B>&#148; means, as of any date of determination,
the amount of reserves that any Lender or the Agent has established (based upon
Wells Fargo Bank, N. A.&#145;s or its Affiliate&#146;s, or any other
Affiliate&#146;s of such Lender or the Agent, as applicable, reasonable
determination of the credit exposure in respect of then extant Bank Products)
for Bank Products then provided or outstanding.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Bankruptcy Code</B>": Title 11, U.S.C., as amended from time to time.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Blocked Account</B>": Any DDA into which the contents of any other DDA is
transferred.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Blocked Account Agreement</B>&#148;: An Agreement, in form satisfactory
to the Agent, which Agreement recognizes the Agent&#146;s Collateral Interest in
the contents of the DDA which is the subject of such Agreement and agrees that
such contents shall be transferred only to the Blocked Account or as otherwise
instructed by the Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Borrower</B>" and "<B>Borrowers</B>": Is defined in the Preamble.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Borrowing Base</B>": The aggregate of the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Inventory Advance Rate times the Cost of the Borrowers&#146; Eligible
Inventory (other than Eligible L/C Inventory and Eligible In-transit Inventory,
and net of Inventory Reserves), but in no event greater than Eighty-five percent
(85%) (or Ninety percent (90%) during the Seasonal Period) of the NRLV of the
Borrowers&#146; Eligible Inventory (net of Inventory Reserves)</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Plus</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Inventory Advance Rate times the Cost of the Borrowers&#146; Eligible
In-transit Inventory (net of Inventory Reserves), but in no event greater than
Eighty-five percent (85%) (or Ninety percent (90%) during the Seasonal Period)
of the NRLV of the Borrowers&#146; Eligible In-transit Inventory (net of
Inventory Reserves); (in no event shall the advances against Eligible In-transit
Inventory ever exceed (i) $10,000,000.00 during the months of September and
October each year (and during November, 2004), or (ii) $5,000,000.00 at all
other times)</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Plus</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Inventory Advance Rate times the Cost of the Borrowers&#146; Eligible L/C
Inventory (net of Inventory Reserves), but in no event greater than Eighty-five
percent (85%) of the NRLV of the Borrowers&#146; Eligible L/C Inventory (net of
Inventory Reserves).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Plus</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The face amount of Eligible Credit Card Receivables multiplied by Ninety percent
(90%).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Borrowing Base Certificate</B>": Is defined in Section 5.4.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Business Day</B>&#148;: Any day other than (a) a Saturday or Sunday;
(b) any day on which banks in Boston, Massachusetts, generally are not open to
the general public for the purpose of conducting commercial banking business; or
(c) a day on which the principal office of the Agent is not open to the general
public to conduct business.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Business Plan</B>&#148;: The Borrowers&#146; business plan annexed
hereto as EXHIBIT 5.11(b) and any revision, amendment, or update of such
business plan to which the Lender has provided its written sign-off.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Capital Expenditures</B>&#148;: The expenditure of funds or the
incurrence of liabilities which may be capitalized in accordance with GAAP.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Capital Lease</B>": Any lease which may be capitalized in accordance with GAAP.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Change in Control</B>": The occurrence of any of the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) The acquisition, by any group of persons (within the meaning of the
Securities Exchange Act of 1934, as amended) or by any Person, of beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission) of 20% or more of the issued and outstanding capital stock of the
Lead Borrower having the right, under ordinary circumstances, to vote for the
election of directors of the Lead Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) The failure at any time of directors designated by The Children's Place
Retail Stores, Inc. to constitute at least a majority of the members of the
board of directors of the Lead Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) Any failure of the Lead Borrower to own, beneficially and of record, 100% of
the capital stock of all other Borrowers.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Chattel Paper</B>": Has the meaning given that term in the UCC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Closing Date</B>": November 21, 2004.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Collateral</B>": Is defined in Section 8.1.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Collateral Interest</B>": Any interest in property to secure an obligation,
including, without limitation, a security interest, mortgage, and deed of trust.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Consent</B>&#148;: Actual consent given by the Revolving Credit Lender
from whom such consent is sought; or the passage of Twelve (12) Business Days
from receipt of written notice to a Revolving Credit Lender from the Agent of a
proposed course of action to be followed by the Agent without such Revolving
Credit Lender&#146;s giving the Agent written notice of that Revolving Credit
Lender&#146;s objection to such course of action, provided that the Agent may
rely on such passage of time as consent by a Revolving Credit Lender only if
such written notice states that consent will be deemed effective if no objection
is received within such time period.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Consolidated</B>&#148;: When used to modify a financial term, test,
statement, or report, refers to the application or preparation of such term,
test, statement or report (as applicable) based upon the consolidation, in
accordance with GAAP, of the financial condition or operating results of the
Borrowers.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Cost</B>&#148;: The lower of (a) or (b), where:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) is the calculated cost of purchases, based upon the Borrowers' accounting
practices, known to the Agent, which practices are in effect on the date on
which this Agreement was executed as such calculated cost is determined from:
invoices received by the Borrowers; the Borrowers' purchase journal; or the
Borrowers' stock ledger.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) is the cost equivalent of the lowest ticketed or promoted price at which the
subject Inventory is offered to the public, after all mark-downs (whether or not
such price is then reflected on the Borrowers' accounting system), which cost
equivalent is determined in accordance with the retail method of accounting,
reflecting the Borrowers' historic business practices.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>(&#147;Cost&#148; does not include inventory capitalization costs
or other non-purchase price charges (such as freight) used in the
Borrowers&#146; calculation of cost of goods sold).
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Costs of Collection</B>&#148;: Includes, without limitation, all
attorneys&#146; reasonable fees and reasonable out-of-pocket expenses incurred
by the Agent&#146;s attorneys, and all reasonable out-of-pocket costs incurred
by the Agent in the administration of the Liabilities and/or the Loan Documents,
including, without limitation, reasonable costs and expenses associated with
travel on behalf of the Agent, where such costs and expenses are directly or
indirectly related to or in respect of the Agent&#146;s: administration and
management of the Liabilities; negotiation, documentation, and amendment of any
Loan Document; or efforts to preserve, protect, collect, or enforce the
Collateral, the Liabilities, and/or the Agent&#146;s Rights and Remedies and/or
any of the rights and remedies of the Agent against or in respect of any
guarantor or other person liable in respect of the Liabilities (whether or not
suit is instituted in connection with such efforts). &#147;Costs of
Collection&#148; also includes the reasonable fees and expenses of Lenders&#146;
Special Counsel. The Costs of Collection are Liabilities, and at the
Agent&#146;s option may bear interest at the then effective Prime Margin Rate.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Customer Credit Liability</B>&#148;: Gift certificates, customer
deposits, merchandise credits, layaway obligations, frequent shopping programs,
and similar liabilities of any Borrower to its retail customers and prospective
customers.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>DDA</B>&#148;: Any checking or other demand daily depository account
maintained by any Borrower other than any Exempt DDA.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Delinquent Revolving Credit Lender</B>": Defined in Section 13.2(c).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Deposit Account</B>": Has the meaning given that term in the UCC and also includes
all demand, time, savings, passbook, or similar accounts maintained with a bank.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Designation</B>&#148;: means the Designation of Secured Lender Under
License Agreement dated as of November 21, 2004, made by the Licensee and TDSF
(as such terms are defined in the Disney License Agreement) in favor of the
Agent and the Lenders, and accepted by the Agent on behalf of itself and the
Lenders.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Disney License Agreement</B>&#148;: Means that certain License and
Conduct of Business Agreement dated November 21, 2004 entered into by and among
the Borrowers and TDS Franchising, LLC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Documents</B>": Has the meaning given that term in the UCC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Documents of Title</B>": Has the meaning given that term in the UCC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>EBITDA</B>": The Borrowers' Consolidated earnings before interest, taxes,
depreciation, and amortization, each as determined in accordance with GAAP.</TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Eligible Assignee</B>&#148;: A bank, insurance company, or company
engaged in the business of making commercial loans having a combined capital and
surplus in excess of $100 Million or any Affiliate of any Revolving Credit
Lender, or any Person to whom a Revolving Credit Lender assigns its rights and
obligations under this Agreement as part of a programmed assignment and transfer
of such Revolving Credit Lender&#146;s rights in and to a material portion of
such Revolving Credit Lender&#146;s portfolio of asset based credit facilities.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Eligible Credit Card Receivables</B>&#148;: Under Five (5) business day
accounts due on a non-recourse basis from major credit card processors (which,
if due on account of a private label credit card program, are deemed in the
discretion of the Agent to be eligible).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Eligible In-transit Inventory</B>&#148;: Inventory (without duplication
as to Eligible Inventory or Eligible L/C Inventory), which previously had been
Eligible L/C Inventory, but with respect to which the documentary L/C has
already been drawn upon by the beneficiary thereof, but with respect to which
the Borrowers have not yet received delivery and possession.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Eligible Inventory</B>&#148;: All of the following: Such of the
Borrowers&#146; Inventory (including Eligible L/C Inventory and Eligible
In-transit Inventory, but excluding other in-transit inventory which fails to
meet the standards for Eligible L/C Inventory or Eligible In-transit Inventory),
at such locations, and of such types, character, qualities and quantities, as
the Agent in its discretion from time to time determines to be acceptable for
borrowing, as to which Inventory, the Agent has a perfected security interest
which is prior and superior to all security interests, claims, and Encumbrances
(other than Permitted Encumbrances).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Eligible L/C Inventory</B>&#148;: Inventory (without duplication as to
Eligible Inventory or Eligible In-transit Inventory), the purchase of which is
supported by a documentary L/C then having an initial expiry of One hundred
twenty (120) or fewer days, provided that</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Such Inventory is of such types, character, qualities and quantities (net of
Inventory Reserves) as the Agent in its discretion from time to time determines
to be eligible for borrowing; and</TD>
</TR>
</TABLE>
<BR>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) If required by the Agent, at the option of the Agent from time to time, in
the Agent's sole and exclusive discretion, the documentary L/C supporting such
purchase names the Agent as consignee of the subject Inventory and the Agent has
control over the documents which evidence ownership of the subject Inventory
(such as by the providing to the Agent of a Customs Brokers Agreement in form
reasonably satisfactory to the Agent).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Employee Benefit Plan"</B>: As defined in ERISA.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Encumbrance"</B>: Each of the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) A Collateral Interest or agreement to create or grant a Collateral Interest;
the interest of a lessor under a Capital Lease; conditional sale or other title
retention agreement; sale of accounts receivable or chattel paper; or other
arrangement pursuant to which any Person is entitled to any preference or
priority with respect to the property or assets of another Person or the income
or profits of such other Person; each of the foregoing whether consensual or
non-consensual and whether arising by way of agreement, operation of law, legal
process or otherwise.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) The filing of any financing statement under the UCC or comparable law of any
jurisdiction.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>End Date</B>&#148;: The date upon which all of the following conditions
are met: (a) all payment Liabilities described in 19.2(a) have been paid in full
and (b) all obligations of any Revolving Credit Lender to make loans and
advances and to provide other financial accommodations to the Borrowers
hereunder shall have been irrevocably terminated and (c) those arrangements
concerning L/C&#146;s, Bank Products, and Bank Product Obligations which are
described in Section 19.2(b) have been made.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Environmental Laws"</B>: All of the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Applicable Law which regulates or relates to, or imposes any standard of
conduct or liability on account of or in respect to environmental protection
matters, including, without limitation, Hazardous Materials, as are now or
hereafter in effect.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) The common law relating to damage to Persons or property from Hazardous
Materials.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Equipment</B>&#148;: Includes, without limitation,
&#147;equipment&#148; as defined in the UCC, and also all furniture, store
fixtures, motor vehicles, rolling stock, machinery, office equipment, plant
equipment, tools, dies, molds, and other goods, property, and assets which are
used and/or were purchased for use in the operation or furtherance of a
Borrowers&#146; business, and any and all accessions or additions thereto, and
substitutions therefor. </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>ERISA</B>&#148;: The Employee Retirement Income Security Act of 1974,
as amended.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>ERISA Affiliate</B>&#148;: Any Person which is under common control
with a Borrower within the meaning of Section 4001 of ERISA or is part of a
group which includes any Borrower and which would be treated as a single
employer under Section 414 of the Internal Revenue Code of 1986, as amended.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Events of Default</B>&#148;: Is defined in Article 10. An &#147;Event
of Default&#148; shall be deemed to have occurred and to be continuing unless
and until that Event of Default has been duly waived by the Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Executive Agreement</B>&#148;: Any agreement or understanding (whether
or not written) to which the Borrower is a party or by which the Borrower may be
bound, which agreement or understanding relates to Executive Pay.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Executive Officer</B>&#148;: Ezra Dabah, Seth Udasin, Mario Ciampi, and
Steven Balasiano, and any other Person who (without regard to title) is the
successor to any of the foregoing or who exercises a substantial portion of the
authority being exercised, at the execution of this Agreement, by any of the
foregoing or a combination of such authority of more than one of the foregoing
or who otherwise has Control of the Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Executive Pay</B>&#148;: All salary, bonuses, and other value directly
or indirectly provided by or on behalf of the Borrower to or for the benefit of
any Executive Officer or any Affiliate, spouse, parent, or child of any
Executive Officer.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Exempt DDA</B>&#148;: A depository account maintained by any Borrower,
the only contents of which may be transfers from the Operating Account and
actually used solely (i) for petty cash purposes; or (ii) for payroll.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Fee Letter</B>&#148;: That certain Fee Letter dated November 21, 2004
entered into by and between the Agent and the Borrowers.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Financially Curable Defaults</B>": Is defined in Section 12.1.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Fiscal</B>&#148;: When followed by &#147;month&#148; or
&#147;quarter&#148;, the relevant fiscal period based on the Borrowers&#146;
fiscal year and accounting conventions (e.g. reference to &#147;Fiscal
2004&#148; is to the fiscal month of the Borrower&#146;s fiscal year ending in
2004). When followed by reference to a specific year, the fiscal year which ends
in a month of the year to which reference is being made (e.g. if the
Borrowers&#146; fiscal year ends in January 2004 reference to that year would be
to the Borrowers&#146; &#147;Fiscal 2004&#148;).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Fixtures</B>": Has the meaning given that term in the UCC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>GAAP</B>&#148;: Principles which are consistent with those promulgated
or adopted by the Financial Accounting Standards Board and its predecessors (or
successors) in effect and applicable to that accounting period in respect of
which reference to GAAP is being made.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>General Intangibles</B>&#148;: Includes, without limitation, the
Acquisition Agreement and the Borrower&#146;s rights in, to, and under the
Acquisition Agreement. General Intangibles also includes, without limitation,
&#147;general intangibles&#148; as defined in the UCC; and also all: rights to
payment for credit extended; deposits; amounts due to any Borrower; credit
memoranda in favor of any Borrower; warranty claims; tax refunds and abatements;
insurance refunds and premium rebates; all means and vehicles of investment or
hedging, including, without limitation, options, warrants, and futures
contracts; records; customer lists; telephone numbers; goodwill; causes of
action; judgments; payments under any settlement or other agreement; literary
rights; rights to performance; royalties; license and/or franchise fees; rights
of admission; licenses; franchises; license agreements, including all rights of
any Borrower to enforce same; permits, certificates of convenience and
necessity, and similar rights granted by any governmental authority; patents,
patent applications, patents pending, and other intellectual property; internet
addresses and domain names; developmental ideas and concepts; proprietary
processes; blueprints, drawings, designs, diagrams, plans, reports, and charts;
catalogs; manuals; technical data; computer software programs (including the
source and object codes therefor), computer records, computer software, rights
of access to computer record service bureaus, service bureau computer contracts,
and computer data; tapes, disks, semi-conductors chips and printouts; trade
secrets rights, copyrights, mask work rights and interests, and derivative works
and interests; user, technical reference, and other manuals and materials; trade
names, trademarks, service marks, and all goodwill relating thereto;
applications for registration of the foregoing; and all other general intangible
property of any Borrower in the nature of intellectual property; proposals; cost
estimates, and reproductions on paper, or otherwise, of any and all concepts or
ideas, and any matter related to, or connected with, the design, development,
manufacture, sale, marketing, leasing, or use of any or all property produced,
sold, or leased, by any Borrower or credit extended or services performed, by
any Borrower, whether intended for an individual customer or the general
business of any Borrower, or used or useful in connection with research by any
Borrower. &#147;General Intangibles&#148; shall include the rights of Borrower
under the Disney License <I>Agreement; provided, however</I>, that
notwithstanding the foregoing or any other provision of this Agreement or any
other Loan Document, in no event shall the Agent or the Revolving Credit Lenders
have any right whatsoever to access, use, apply, assign, convey, transfer,
sublicense, copy, infringe, enforce, exercise rights under, or disclose to any
Person, for any purpose, in any manner, directly or indirectly, pursuant to a
power of attorney, in their own or the Borrower&#146;s name, or otherwise, any
interest in the Disney License Agreement, any rights of any party thereto
(including without limitation any right to operate or manage the Business or any
part thereof), or any Disney Properties or Licensed Materials (as such terms are
defined in the Disney License Agreement), and <I>provided, further, </I>that
none of the Disney Companies shall have any obligations, or owe any performance
or any duty of any kind whatsoever, to the Agent or the Revolving Credit
Lenders, in each case, except to the limited extent expressly permitted by the
Designation and in compliance with Section 16.5 of the Disney License Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Goods</B>&#148;: Has the meaning given that term in the UCC, and also
includes all things movable when a security interest therein attaches and also
all computer programs embedded in goods and any supporting information provided
in connection with a transaction relating to the program if (i) the program is
associated with the goods in such manner that it customarily is considered part
of the goods or (ii) by becoming the owner of the goods, a Person acquires a
right to use the program in connection with the goods.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Guarantor(s)</B>": Initially, Hoop Canada Holdings, Inc., a Delaware corporation,
and together with any Person who subsequently becomes obligated as a guarantor
on account of the Liabilities, jointly, severally, and collectively.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Guarantor's Default</B>": The occurrence of any Event of Default with respect to
any Guarantor or Secondary Guarantor, as if the Guarantor or Secondary
Guarantor, as the case may be, were one of the Borrowers hereunder.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Hazardous Materials</B>": Any (a) substance which is defined or regulated as a
hazardous material in or under any Environmental Law and (b) oil in any physical
state.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Indebtedness</B>": All indebtedness and obligations of or assumed by any Person on
account of or in respect to any of the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) In respect of money borrowed (including any indebtedness which is
non-recourse to the credit of such Person but which is secured by an Encumbrance
on any asset of such Person) whether or not evidenced by a promissory note,
bond, debenture or other written obligation to pay money.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) In connection with any letter of credit or acceptance transaction
(including, without limitation, the face amount of all letters of credit and
acceptances issued for the account of such Person or reimbursement on account of
which such Person would be obligated).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) In connection with the sale or discount of accounts receivable or chattel
paper of such Person.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d) On account of deposits or advances.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(e) As lessee under Capital Leases.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(f) In connection with any sale and leaseback transaction.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Indebtedness"</B> also includes:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(x) Indebtedness of others secured by an Encumbrance on any asset of such
Person, whether or not such Indebtedness is assumed by such Person.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(y) Any guaranty, endorsement, suretyship or other undertaking pursuant to which
that Person may be liable on account of any obligation of any third party.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(z) The Indebtedness of a partnership or joint venture for which such Person is
liable as a general partner or joint venturer.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>In Default</B>&#148;: Any occurrence, circumstance, or state of facts
with respect to a Borrower which (a) is an Event of Default; or (b) would become
an Event of Default if any requisite notice were given and/or any requisite
period of time were to run and such occurrence, circumstance, or state of facts
were not absolutely cured within any applicable grace period.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Indemnified Person</B>": Is defined in Section 20.13.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Instruments</B>": Has the meaning given that term in the UCC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Interest Payment Date"</B>: With reference to:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Libor Loan: The last day of the Interest Period relating thereto; the
Termination Date; and the End Date.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Prime Margin Loan: The first day of each month; the Termination Date; and
the End Date.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Interest Period</B>": The following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) With respect to each Libor Loan: Subject to Subsection (c), below, the
period commencing on the date of the making or continuation of, or conversion
to, the subject Libor Loan and ending one, two, or three months thereafter, as
the Lead Borrower may elect by notice (pursuant to Section 2.5) to the Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) With respect to each Prime Margin Loan: Subject to Subsection (c), below,
the period commencing on the date of the making or continuation of or conversion
to such Prime Margin Loan and ending on that date (i) as of which the subject
Prime Margin Loan is converted to a Libor Loan, as the Lead Borrower may elect
by notice (pursuant to Section 2.5) to the Agent, or (ii) on which the subject
Prime Margin Loan is paid by the Borrowers.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) The setting of Interest Periods is in all instances subject to the
following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Any Interest Period for a Prime Margin Loan which would otherwise end on a
day which is not a Business Day shall be extended to the next succeeding
Business Day.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Any Interest Period for a Libor Loan which would otherwise end on a day
that is not a Business Day shall be extended to the next succeeding Business
Day, unless that succeeding Business Day is in the next calendar month, in which
event such Interest Period shall end on the last Business Day of the month
during which the Interest Period ends.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) Subject to Subsection (iv), below, any Interest Period applicable to a
Libor Loan, which Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month during which such Interest
Period ends, shall end on the last Business Day of the month during which that
Interest Period ends.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) Any Interest Period which would otherwise end after the Termination Date
shall end on the Termination Date.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(v) The number of Interest Periods in effect at any one time is subject to
Section 2.11(e) hereof.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Inventory</B>&#148;: Includes, without limitation,
&#147;inventory&#148; as defined in the UCC and also all: (a) Goods which are
leased by a Person as lessor; are held by a Person for sale or lease or to be
furnished under a contract of service; are furnished by a Person under a
contract of service; or consist of raw materials, work in process, or materials
used or consumed in a business; (b) Goods of said description in transit; (c)
Goods of said description which are returned, repossessed and rejected; (d)
packaging, advertising, and shipping materials related to any of the foregoing;
(e) all names, marks, and General Intangibles affixed or to be affixed or
associated thereto; and (f) Documents and Documents of Title which represent any
of the foregoing.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Inventory Advance Rate</B>&#148;: Means the following designated
percentage during the corresponding specified period:</TD>
</TR>
</TABLE>
<BR>

<PRE>
      ------------------------------------------- -----------------------------------------
                 <B>Calendar Period                              Percentage</B>
      ------------------------------------------- -----------------------------------------
        From September 1 to December 15 each year                  76%
      ------------------------------------------- -----------------------------------------
        From December 16 to May 31 each year                       64%
      ------------------------------------------- -----------------------------------------
        From June 1 to August 31 each year                         66%
      ------------------------------------------- -----------------------------------------
</PRE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Inventory Reserves</B>&#148;: Such Reserves as may be established from
time to time by the Agent in the Agent&#146;s discretion with respect to the
determination of the saleability, at retail, of the Eligible Inventory or which
reflect such other factors as affect the market value of the Eligible Inventory.
As of the Closing Date, the following Inventory Reserves have been established,
as set forth on the Borrowing Base Certificate:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Goods designated "return to vendor."</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Damaged and/or defective goods.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) Capitalized Inventory costs and other non-purchase price charges.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) Promotional inventory items.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(v) Inventory located in Canada.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(vi) Video pre-sales.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(vii) Inventory not located at one of the Borrowers' retail locations or
distribution centers as to which an appropriate collateral access agreement has
been executed.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(viii) Inventory located at closed retail locations.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ix) Inventory to be transferred to the Walt Disney Companies.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(x) Shrink.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Investment Property</B>": Has the meaning given that term in the UCC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Issuer</B>": The issuer of any L/C.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>L/C</B>&#148;: Any letter of credit, the issuance of which is procured
by the Agent for the account of any Borrower and any acceptance made on account
of such letter of credit.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>L/C Landing Costs</B>&#148;: To the extent not included in the Stated
Amount of an L/C, customs, duty, freight, and other out-of-pocket costs and
expenses which will be expended to &#147;land&#148; the Inventory, the purchase
of which is supported by such L/C.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Lead Borrower</B>&#148;: Means The Disney Store, LLC, unless and until
the Permitted Mergers have been consummated, and then, Hoop Retail Stores, LLC.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Lease</B>&#148;: Any lease or other agreement, no matter how styled or
structured, pursuant to which a Borrower is entitled to the use or occupancy of
any space.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Leasehold Interest</B>": Any interest of a Borrower as lessee under any Lease.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Lenders&#146; Special Counsel</B>&#148;: A single counsel, selected by
the Majority Lenders following the occurrence of an Event of Default, to
represent the interests of the Revolving Credit Lenders in connection with the
enforcement, attempted enforcement, or preservation of any rights and remedies
under this, or any other Loan Document, as well as in connection with any
&#147;workout&#148;, forbearance, or restructuring of the credit facility
contemplated hereby.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Letter-of-Credit Right</B>&#148;: Has the meaning given that term in
UCC and also refers to any right to payment or performance under an L/C, whether
or not the beneficiary has demanded or is at the time entitled to demand payment
or performance.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Liabilities</B>": Includes, without limitation, the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) All and each of the following, whether now existing or hereafter arising
under this Agreement or under any of the other Loan Documents:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Any and all direct and indirect liabilities, debts, and obligations of each
Borrower to the Agent or any Revolving Credit Lender, each of every kind,
nature, and description.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Each obligation to repay any loan, advance, indebtedness, note, obligation,
overdraft, or amount now or hereafter owing by any Borrower to the Agent or any
Revolving Credit Lender (including all future advances whether or not made
pursuant to a commitment by the Agent or any Revolving Credit Lender), whether
or not any of such are liquidated, unliquidated, primary, secondary, secured,
unsecured, direct, indirect, absolute, contingent, or of any other type, nature,
or description, or by reason of any cause of action which the Agent or any
Revolving Credit Lender may hold against any Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) All notes and other obligations of each Borrower now or hereafter assigned
to or held by the Agent or any Revolving Credit Lender, each of every kind,
nature, and description.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) All interest, fees, and charges and other amounts which may be charged by
the Agent or any Revolving Credit Lender to any Borrower and/or which may be due
from any Borrower to the Agent or any Revolving Credit Lender from time to time.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(v) All Bank Product Obligations.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(vi) All costs and expenses incurred or paid by the Agent or any Revolving
Credit Lender in respect of any agreement between any Borrower and the Agent or
any Revolving Credit Lender or instrument furnished by any Borrower to the Agent
or any Revolving Credit Lender (including, without limitation, Costs of
Collection, attorneys' reasonable fees, and all court and litigation costs and
expenses).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(vii) Any and all covenants of each Borrower to or with the Agent or any
Revolving Credit Lender and any and all obligations of each Borrower to act or
to refrain from acting in accordance with any agreement between that Borrower
and the Agent or any Revolving Credit Lender or instrument furnished by that
Borrower to the Agent or any Revolving Credit Lender.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(viii) Each of the foregoing as if each reference to the " the Agent or any
Revolving Credit Lender" were to each Affiliate of the Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) Any and all direct or indirect liabilities, debts, and obligations of each
Borrower to the Agent or any Affiliate of the Agent, each of every kind, nature,
and description owing on account of any service or accommodation provided to, or
for the account of any Borrower pursuant to this or any other Loan Document,
including cash management services and the issuances of L/C's.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Libor Business Day</B>": Any day which is both a Business Day and a day on which
the principal interbank market for Libor deposits in London in which Wells Fargo
Bank, N. A. participates is open for dealings in United States Dollar deposits.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Libor Loan</B>": Any Revolving Credit Loan which bears interest at a Libor Rate.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Libor Margin</B>": The following applicable percentage, based upon the
corresponding Average Excess Availability:</TD>
</TR>
</TABLE>
<BR>

<PRE>
           ---------------------------------------------------------------------------------
             <B>Level        LIBOR Margin              Average Excess Availability</B>
           ---------------------------------------------------------------------------------
                I              2.00%                 Greater than $20,000,000.00
           ---------------------------------------------------------------------------------
               II              2.25%                 Less than or equal to $20,000,000.00
           ---------------------------------------------------------------------------------
</PRE>
<P ALIGN=LEFT><FONT SIZE=3>The Margin on the Closing Date shall be established
at Level II and adjusted at the end of each fiscal quarter thereafter based upon
the amount of Average Excess Availability.</FONT></P>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Libor Offer Rate"</B>: That rate of interest (rounded upwards, if necessary,
to the next 1/100 of 1%) determined by the Agent to be the highest prevailing
rate per annum at which deposits on U.S. Dollars are offered to Wells Fargo
Bank, N. A., by first-class banks in the London interbank market in which Wells
Fargo Bank, N. A. participates at or about 10:00AM (Boston Time) Two (2) Libor
Business Days before the first day of the Interest Period for the subject Libor
Loan, for a deposit approximately in the amount of the subject loan for a period
of time approximately equal to such Interest Period.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Libor Rate</B>&#148;: That per annum rate which is the aggregate of the
Libor Offer Rate plus the Libor Margin except that, in the event that the Agent
determines that any Revolving Credit Lender may be subject to the Reserve
Percentage, the &#147;Libor Rate&#148; shall mean, with respect to any Libor
Loans then outstanding (from the date on which that Reserve Percentage first
became applicable to such loans), and with respect to all Libor Loans thereafter
made, an interest rate per annum equal the sum of (a) plus (b), where:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) is the decimal equivalent of the following fraction:</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=CENTER><U>Libor Offer Rate</U><BR><BR>1 minus Reserve Percentage</P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) is the applicable Libor Margin.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Liquidation</B>&#148;: The exercise, by the Agent, of those rights
accorded to the Agent under the Loan Documents as a creditor of the Borrowers
following and on account of the occurrence of an Event of Default looking
towards the realization on the Collateral. Derivations of the word
&#147;Liquidation&#148; (such as &#147;Liquidate&#148;) are used with like
meaning in this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Loan Account</B>": Is defined in Section 2.8.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Loan Commitment</B>": With respect to each Revolving Credit Lender, that respective
Revolving Credit Lender's Revolving Credit Dollar Commitment.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Loan Documents</B>&#148;: This Agreement and each other instrument or
document from time to time executed and/or delivered in connection with the
arrangements contemplated hereby or in connection with any transaction with the
Agent or any Affiliate of the Agent, including, without limitation, any
transaction which arises out of any cash management, depository, investment,
letter of credit, interest rate protection, or equipment leasing services
provided by the Agent or any Affiliate of the Agent, including any Bank Product
Agreements, as each may be amended from time to time.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Majority Lenders</B>": If there are two or fewer Revolving Credit Lenders who are
not Delinquent Revolving Credit Lenders:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All Revolving Credit Lenders who are not Delinquent Revolving Credit Lenders.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>If there are three or more Revolving Credit Lenders who are not
Delinquent Revolving Credit Lenders:
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Revolving Credit Lenders (other than Delinquent Revolving Credit Lenders)
holding more than 50% of the Revolving Credit Percentage Commitments (calculated
without regard to any Revolving Credit Percentage Commitment of any Delinquent
Revolving Credit Lender).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Material Accounting Change</B>&#148;: Any change in GAAP applicable to
accounting periods subsequent to the Borrowers&#146; fiscal year most recently
completed prior to the execution of this Agreement, which change has a material
effect on the Borrowers&#146; Consolidated financial condition or operating
results, as reflected on financial statements and reports prepared by or for the
Borrowers, when compared with such condition or results as if such change had
not taken place or where preparation of the Borrowers&#146; statements and
reports in compliance with such change results in the breach of a financial
performance covenant imposed pursuant to Section 5.11 where such a breach would
not have occurred if such change had not taken place or visa versa.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Material Adverse Change</B>&#148;: Any event, fact, circumstance,
change in, or effect, on the business of the Borrowers, when taken as a whole,
which, individually or in the aggregate or on a cumulative basis with any other
circumstance, changes in, or effects on, the Borrowers or the Collateral,
constitutes any of the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) A material adverse change in the business, operations, results of
operations, assets, liabilities, or condition (financial or otherwise) of the
Borrowers (when taken as a whole), including, without limitation, a material
adverse change in the business, operations, results, assets, liabilities or
condition since the date of the latest financial information supplied pursuant
to this Agreement or at any time when compared to the Business Plan.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) The material impairment of the Borrowers' ability to perform their
obligations under the Loan Documents or of the Agent's ability to enforce the
Liabilities or to realize on any of the Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) A material adverse effect on the value of the Collateral or the amount which
the Agent likely would receive (after giving consideration to delays in payment
and costs of enforcement).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(d) A material impairment to the priority of the Agent's Collateral Interests in
the Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Maturity Date</B>": November 21, 2007.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Minimum Reserve</B>": An amount equal to $10,000,000.00, unless increased pursuant
to Exhibit 5.11(a), in which event, $12,000,000.00.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Nominee</B>": A business entity (such as a corporation or limited partnership)
formed by the Agent to own or manage any Post Foreclosure Asset.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Non-Curable Defaults</B>": Is defined in Section 12.2.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>NRLV</B>&#148;: Means the net recovery value (liquidation value) of
Inventory expressed as a percentage of the cost of such Inventory, as determined
by the Agent in its discretion based upon the most recent Inventory appraisal
available to the Agent conducted by an appraiser reasonably acceptable to the
Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Operating Account</B>": Is defined in Section 7.1.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Other Defaults</B>": Is defined in Section12.3.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>OverLoan</B>&#148;: A loan, advance, or providing of credit support
(such as the issuance of any L/C) to the extent that, immediately after its
having been made, Availability is less than zero.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Payment Intangible</B>&#148;: As defined in the UCC and also any
general intangible under which the Account Debtor&#146;s primary obligation is a
monetary obligation.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Permitted Disposition</B>": None.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Permitted Encumbrances</B>": the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Encumbrances in favor of the Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Those Encumbrances (if any) listed on <B>EXHIBIT 4.6</B>, annexed hereto.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Purchase money security interests in Equipment to secure Indebtedness otherwise
permitted hereby. </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Permitted Indebtedness</B>": The following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Any Indebtedness on account of the Revolving Credit.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Indebtedness (if any) listed on <B>EXHIBIT 4.7</B>, annexed hereto.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Indebtedness on account of Equipment acquired in compliance with the
requirements of Section 4.6(c), the incurrence of which would not otherwise be
prohibited by this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Permitted Investment</B>": The following, in each instance only if subject to a
prior perfected security interest in favor of the Agent to secure the
Liabilities:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Indebtedness entitled to the full faith and credit of the United States.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Indebtedness which has at least the second highest rating of nationally
recognized rating agency.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=30% ALIGN=LEFT></TD>
<TD WIDTH=70%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Indebtedness advanced by Hoop Retail Stores, LLC or The Disney Store, LLC into
and for the benefit of Hoop Canada, Inc. or The Disney Store (Canada) Ltd., not
to exceed $5,000,000.00 in the aggregate at any one time.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Permitted Mergers</B>&#148;: The mergers of (i) The Disney Store, LLC
with and into Hoop Retail Stores, LLC, a Delaware limited liability company,
with Hoop Retail Stores, LLC as the surviving entity, and (ii) The Disney Store
(Canada) Ltd. with and into Hoop Canada, Inc., a New Brunswick corporation, with
Hoop Canada, Inc. as the surviving entity, as contemplated in the Acquisition
Agreement, but if, and only if, contemporaneously therewith, confirmed through
the execution and delivery by the Borrowers, including Hoop Retail Stores, LLC
and Hoop Canada, Inc., of whatever documents, instruments, and agreements that
the Agent may require, in its sole and exclusive discretion, to ratify, confirm,
and reaffirm all and singular the terms and conditions of this Agreement and
each of the other Loan Documents, including the continued priority and
perfection of the security interest granted to the Agent and the Revolving
Credit Lenders in all Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Person</B>&#148;: Any natural person, and any corporation, limited
liability company, trust, partnership, joint venture, or other enterprise or
entity.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Post Foreclosure Asset</B>&#148;: All or any part of the Collateral,
ownership of which is acquired by the Agent or a Nominee on account of the
&#147;bidding in&#148; at a disposition as part of a Liquidation or by reason of
a &#147;deed in lieu&#148; type of transaction.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Prime</B>&#148;: The Prime Rate announced from time to time by Wells
Fargo Bank, N. A. (or any successor in interest to Wells Fargo Bank, N. A.). In
the event that said bank (or any such successor) ceases to announce such a rate,
&#147;Prime&#148; shall refer to that rate or index announced or published from
time to time as the Agent, in good faith, designates as the functional
equivalent to said Prime Rate. Any change in &#147;Prime&#148; shall be
effective, for purposes of the calculation of interest due hereunder, when such
change is made effective generally by the bank on whose rate or index
&#147;Prime&#148; is being set.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Prime Margin Loan"</B>: Each Revolving Credit Loan while bearing interest at
the Prime Margin Rate.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>"Prime Margin Rate"</B>: The aggregate of Prime plus the following applicable
percentage, based upon the corresponding Average Excess Availability:</TD>
</TR>
</TABLE>
<BR>

<PRE>
           --------------------------------------------------------------------------------
                <B>Level       Prime Margin             Average Excess Availability</B>
           --------------------------------------------------------------------------------
                 I             0.25%                 Greater than $20,000,000.00
           --------------------------------------------------------------------------------
                II             0.25%                 Less than or equal to $20,000,000.00
           --------------------------------------------------------------------------------
</PRE>

<P ALIGN=LEFT><FONT SIZE=3>The Margin on the Closing Date shall be established
at Level II and adjusted at the end of each fiscal quarter thereafter based upon
the amount of Average Excess Availability.</FONT></P>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Protective OverAdvances</B>&#148;: Revolving Credit Loans which are
OverLoans, but as to which each of the following conditions is satisfied: (a)
the Revolving Credit Ceiling is not exceeded; and (b) when aggregated with all
other Protective OverAdvances, such Revolving Credit Loans do not aggregate more
than Ten percent (10%) of the aggregate of the Borrowing Base, not to exceed
$7,000,000.00; (c) any Protective OverAdvance may be outstanding for no more
than Sixty (60) consecutive Business Days, (d) Protective OverAdvances may only
be made up to Two (2) times in any Twelve (12) month period, and (e) such
Revolving Credit Loans are made or undertaken in the Agent&#146;s discretion to
protect and preserve the interests of the Revolving Credit Lenders.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Proceeds</B>&#148;: Includes, without limitation, &#147;Proceeds&#148;
as defined in the UCC and each type of property described in Section 8.1 hereof.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Receipts</B>&#148;: All cash, cash equivalents, money, checks, credit
card slips, receipts and other Proceeds from any sale of the Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Receivables Collateral</B>&#148;: That portion of the Collateral which
consists of Accounts, Accounts Receivable, General Intangibles, Chattel Paper,
Instruments, Documents of Title, Documents, Investment Property, Payment
Intangibles, Letter-of-Credit Rights, bankers&#146; acceptances, and all other
rights to payment.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Register</B>": Is defined in Section 17.2(c).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Requirements of Law</B>": As to any Person:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Applicable Law.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b) That Person's organizational documents.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=25% ALIGN=LEFT></TD>
<TD WIDTH=75%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c) That Person's by-laws and/or other instruments which deal with corporate or
similar governance, as applicable.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Reserve Percentage</B>&#148;: The decimal equivalent of that rate
applicable to a Revolving Credit Lender under regulations issued from time to
time by the Board of Governors of the Federal Reserve System for determining the
maximum reserve requirement of that Revolving Credit Lender with respect to
&#147;Eurocurrency liabilities&#148; as defined in such regulations. The Reserve
Percentage applicable to a particular Eurodollar Loan shall be based upon that
in effect during the subject Interest Period, with changes in the Reserve
Percentage which take effect during such Interest Period to take effect (and to
consequently change any interest rate determined with reference to the Reserve
Percentage) if and when such change is applicable to such loans.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Revolving Credit</B>": Is defined in Section 2.1.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Revolving Credit Ceiling</B>": $100,000,000.00</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Revolving Credit Closing Fee</B>": Is defined in Section 2.12.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Revolving Credit Dollar Commitment</B>": As set forth on <B>EXHIBIT 2.22</B>, annexed
hereto (as such amounts may change in accordance with the provisions of this
Agreement).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Revolving Credit Early Termination Fee</B>": Is defined in Section 2.14.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Revolving Credit Lenders</B>&#148;: Each Revolving Credit Lender to
which reference is made in the Preamble of this Agreement and any other Person
who becomes a &#147;Revolving Credit Lender&#148; in accordance with the
provisions of to this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Revolving Credit Loans</B>&#148;: Loans made under the Revolving
Credit, except that where the term &#147;Revolving Credit Loan&#148; is used
with reference to available interest rates applicable to the loans under the
Revolving Credit, it refers to so much of the unpaid principal balance of the
Loan Account as bears the same rate of interest for the same Interest Period.
(See Section 2.11(d)).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Revolving Credit Note</B>": Is defined in Section 2.9.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Revolving Credit Percentage Commitment</B>&#148;: As set forth on
<B>EXHIBIT 2.22</B>, annexed hereto (as such amounts may change in accordance
with the provisions of this Agreement).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Seasonal Period</B>": Means that period from September 1 through November 30 each
year.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Secondary Guarantor(s)</B>": Initially, The Disney Store (Canada) Ltd., an Ontario
corporation, and Hoop Canada, Inc., a New Brunswick corporation, jointly,
severally, and collectively.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Stated Amount</B>": The maximum amount for which an L/C may be honored.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>SuperMajority Lenders</B>&#148;: Revolving Credit Lenders (other than
Delinquent Revolving Credit Lenders) holding 66-2/3% or more the Revolving
Credit Percentage Commitments (calculated without regard to any Revolving Credit
Percentage Commitment of any Delinquent Revolving Credit Lender).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Supporting Obligation</B>&#148;: Has the meaning given that term in the
UCC and also refers to a Letter-of-Credit Right or secondary obligation which
supports the payment or performance of an Account, Chattel Paper, a Document, a
General Intangible, an Instrument, or Investment Property.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Termination Date</B>&#148;: The earliest of (a) the Maturity Date; or
(b) the occurrence of any event described in Section 10.11, below; or (c) the
Agent&#146;s notice to the Lead Borrower setting the Termination Date on account
of the occurrence of any Event of Default other than as described in Section
10.11, below; or (d) that date, ninety (90) days irrevocable written notice of
which is provided by the Lead Borrower to the Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Transfer</B>&#148;: Wire transfer pursuant to the wire transfer system
maintained by the Board of Governors of the Federal Reserve Board, or as
otherwise may be agreed to from time to time by the Agent making such Transfer
and the subject Revolving Credit Lender. Wire instructions may be changed in the
same manner that Notice Addresses may be changed (Section 18.1), except that no
change of the wire instructions for Transfers to any Revolving Credit Lender
shall be effective without the consent of the Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>UCC</B>&#148;: The Uniform Commercial Code as in effect from time to
time in Massachusetts.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;<B>Unanimous Consent</B>&#148;: Consent of Revolving Credit Lenders (other
than Delinquent Revolving Credit Lenders) holding 100% of the Loan Commitments
(other than Loan Commitments held by a Delinquent Revolving Credit Lender).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Unused Line Fee</B>": Is defined in Section 2.13.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
"<B>Walt Disney Companies</B>": Means Disney Enterprises, Inc., a Delaware corporation;
and Disney Credit Card Services, Inc., a California corporation; and TDS
Franchising, LLC, a California limited liability company.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 2 The Revolving Credit:</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.1. Establishment of Revolving Credit.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Revolving
Credit Lenders hereby establish a revolving line of credit (the "Revolving
Credit") in the Borrowers' favor pursuant to which each Revolving Credit Lender,
subject to, and in accordance with, this Agreement, acting through the Agent,
shall make loans and advances and otherwise provide financial accommodations to
and for the account of the Borrowers as provided herein.</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Notwithstanding the foregoing, Hoop Retail Stores, LLC shall not have any
right to request or obtain any loans or advances, nor shall any other Borrower
transfer any proceeds of any loan or advance to Hoop Retail Stores, LLC, unless
and until the Permitted Mergers have been consummated to the satisfaction of the
Agent, in the Agent's sole and exclusive discretion.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) From and after consummation of the Permitted Mergers, all terms and
conditions of this Agreement and each of the other Loan Documents shall apply
to, and address only the remaining Borrowers, and shall no longer apply to or
address The Disney Store, LLC.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Loans, advances,
and financial accommodations under the Revolving Credit shall be made with
reference to the Borrowing Base and shall be subject to Availability. The
Borrowing Base and Availability shall be determined by the Agent by reference to
Borrowing Base Certificates furnished as provided in Section 5.4, below, and
shall be subject to the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Such determination shall take into account such Reserves as the Agent may
determine as being applicable thereto.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) The Cost of Eligible Inventory will be determined in a manner consistent
with current tracking practices, based on the Borrowers' stock ledger inventory.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The commitment
of each Revolving Credit Lender to provide such loans, advances, and financial
accommodations is subject to Section 2.23.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The proceeds of
borrowings under the Revolving Credit shall be used solely for the Borrowers'
working capital and Capital Expenditures, and to make a portion of the working
capital adjustment to be made pursuant to Section 2.3 and Section 3.3.1 of the
Acquisition Agreement, all solely to the extent not prohibited by this
Agreement. No proceeds of a borrowing under the Revolving Credit may be used,
nor shall any be requested, with a view towards the accumulation of any general
fund or funded reserve of the Borrowers other than in the ordinary course of the
Borrowers' business and consistent with the provisions of this
Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.2. Advances in Excess of Borrowing Base (OverLoans).</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Revolving
Credit Lender has any obligation to the Borrowers to make any loan or advance,
or otherwise to provide any credit to or for the benefit of the Borrowers where
the result of such loan, advance, or credit is an OverLoan.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Revolving
Credit Lenders' obligations, among themselves, are subject to (among other
provisions of this Agreement) Section 13.2(a) (which relates to each Revolving
Credit Lender's making amounts available to the Agent) and 16.3(a) (which
relates to Protective OverAdvances).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Revolving
Credit Lenders' providing of an OverLoan on any one occasion does not affect the
obligations of each Borrower hereunder (including each Borrower's obligation to
immediately repay any amount which otherwise constitutes an OverLoan) nor
obligate the Revolving Credit Lenders to do so on any other occasion.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.3. Risks of Value of Collateral.</B> The Agent's reference to a given asset in
connection with the making of loans, credits, and advances and the providing of
financial accommodations under the Revolving Credit and/or the monitoring of
compliance with the provisions hereof shall not be deemed a determination by the
Agent or any Revolving Credit Lender relative to the actual value of the asset
in question. All risks concerning the value of the Collateral are and remain
upon the Borrowers. All Collateral secures the prompt, punctual, and faithful
performance of the Liabilities whether or not relied upon by the Agent in
connection with the making of loans, credits, and advances and the providing of
financial accommodations under the Revolving Credit.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.4. Commitment to Make Revolving Credit Loans and Support Letters of Credit.</B>
Subject to the provisions of this Agreement, the Revolving Credit Lenders shall
make a loan or advance under the Revolving Credit and the Agent shall endeavor
to have an L/C issued for the account of the Lead Borrower, in each instance if
duly and timely requested by the Lead Borrower as provided herein provided
that:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No OverLoan is
then outstanding and none will result therefrom.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No Borrower is
then In Default and none will thereby become In Default.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.5. Revolving Credit Loan Requests.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Requests for
loans and advances under the Revolving Credit or for the continuance or
conversion of an interest rate applicable to a Revolving Credit Loan may be
requested by the Lead Borrower in such manner as may from time to time be
acceptable to the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subject to the
provisions of this Agreement, the Lead Borrower may request a Revolving Credit
Loan and elect an interest rate and Interest Period to be applicable to that
Revolving Credit Loan by giving notice to the Agent by no later than the
following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) If such
Revolving Credit Loan is to be or is to be converted to a Prime Margin Loan: By
2:00 PM on the Business Day on which the subject Revolving Credit Loan is to be
made or is to be so converted. Prime Margin Loans requested by the Lead
Borrower, other than those resulting from the conversion of a Libor Loan, shall
not be less than $10,000.00.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) If such
Revolving Credit Loan is to be, or is to be continued as, or converted to, a
Libor Loan: By 2:00PM Three (3) Libor Business Days before the commencement of
any new Interest Period or the end of the then applicable Interest Period. Libor
Loans and conversions to Libor Loans shall each be not less than $1,000,000.00
and in increments of $500,000.00 in excess of such minimum.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Any Libor
Loan which matures while any Borrower is In Default shall be converted, at the
option of the Agent, to a Prime Margin Loan notwithstanding any notice from the
Lead Borrower that such Loan is to be continued as a Libor Loan.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any request for
a Revolving Credit Loan or for the continuance or conversion of an interest rate
applicable to a Revolving Credit Loan which is made after the applicable
deadline therefor, as set forth above, shall be deemed to have been made at the
opening of business on the then next Business Day or Libor Business Day, as
applicable.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Lead
Borrower may request that the Agent cause the issuance by the Issuer of L/C's
for the account of the Borrowers as provided in Section 2.18.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Agent may
rely on any request for a loan or advance, or other financial accommodation
under the Revolving Credit which the Agent, in good faith, believes to have been
made by a Person duly authorized to act on behalf of the Lead Borrower and may
decline to make any such requested loan or advance, or issuance, or to provide
any such financial accommodation pending the Agent's being furnished with such
documentation concerning that Person's authority to act as may be satisfactory
to the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) A request by the
Lead Borrower for loan or advance, or other financial accommodation under the
Revolving Credit shall be irrevocable and shall constitute certification by each
Borrower that as of the date of such request, each of the following is true and
correct:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) There has been
no Material Adverse Change in the Borrowers' financial condition from the most
recent financial information furnished Agent or any Revolving Credit Lender
pursuant to this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) All or a
portion of any loan or advance so requested will be set aside by the Borrowers
to cover the Borrowers' obligations for sales tax on account of sales since the
then most recent borrowing pursuant to the Revolving Credit.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Each
representation which is made herein or in any of the Loan Documents is then true
and complete as of and as if made on the date of such request.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) That no
Borrower is In Default, or if a Borrower is In Default, it shall be accompanied
by a written Certificate of the Lead Borrower's President or its Chief Financial
Officer describing (in reasonable detail) the facts and circumstances thereof
and the steps (if any) being taken to remedy such condition (but such
Certificate shall not relieve the specified Borrower from being In
Default).</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.6. Suspension of Revolving Credit.</B> If, at any time or from time to time, any
Borrower is In Default or there has occurred a Material Adverse
Change:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Agent may,
and at the direction of the SuperMajority Lenders shall, suspend the Revolving
Credit immediately, in which event, neither the Agent nor any Revolving Credit
Lender shall be obligated, during such suspension, to make any loans or advance,
or to provide any financial accommodation hereunder or to seek the issuance of
any L/C</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent may,
and at the direction of the SuperMajority Lenders shall, b suspend the right of
the Lead Borrower to request any Libor Loan or to convert any Prime Margin Loan
to a Libor Loan.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.7. Making of Revolving Credit Loans.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A loan or
advance under the Revolving Credit shall be made by the transfer of the proceeds
of such loan or advance to the Operating Account or as otherwise instructed by
the Lead Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) A loan or
advance shall be deemed to have been made under the Revolving Credit (and the
Borrowers shall be indebted to the Agent and the Revolving Credit Lenders for
the amount thereof immediately) at the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The Agent's
initiation of the transfer of the proceeds of such loan or advance in accordance
with the Lead Borrower's instructions (if such loan or advance is of funds
requested by the Lead Borrower).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) The charging
of the amount of such loan to the Loan Account (in all other
circumstances).</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) There shall not
be any recourse to or liability of the Agent or any Revolving Credit Lender, on
account of:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Any delay in
the making of any loan or advance requested under the Revolving Credit.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Any delay by
any bank or other depository institution in treating the proceeds of any such
loan or advance as collected funds.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Any delay in
the receipt, and/or any loss, of funds which constitute a loan or advance under
the Revolving Credit, the wire transfer of which was properly initiated by the
Agent in accordance with wire instructions provided to the Agent by the Lead
Borrower.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.8. The Loan Account.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) An account
(<B>"Loan Account"</B>) shall be opened on the books of the Agent in which a
record shall be kept of all loans and advances made under the Revolving
Credit.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent shall
also keep a record (either in the Loan Account or elsewhere, as the Agent may
from time to time elect) of all interest, fees, service charges, costs,
expenses, and other debits owed to the Agent and each Revolving Credit Lender on
account of the Liabilities and of all credits against such amounts so
owed.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All credits
against the Liabilities shall be conditional upon final payment to the Agent for
the account of each Revolving Credit Lender of the items giving rise to such
credits. The amount of any item credited against the Liabilities which is
charged back against the Agent or any Revolving Credit Lender or is disgorged
for any reason or is not so paid shall be a Liability and shall be added to the
Loan Account, whether or not the item so charged back or not so paid is
returned.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Except as
otherwise provided herein, all fees, service charges, costs, and expenses for
which any Borrower is obligated hereunder are payable on demand. In the
determination of Availability, the Agent may deem fees, service charges, accrued
interest, and other payments which will be due and payable between the date of
such determination and the first day of the then next succeeding month as having
been advanced under the Revolving Credit whether or not such amounts are then
due and payable.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Agent,
without the request of the Lead Borrower, may advance under the Revolving Credit
any interest, fee, service charge, or other payment to which the Agent or any
Revolving Credit Lender is entitled from any Borrower pursuant hereto and may
charge the same to the Loan Account notwithstanding that an OverLoan may result
thereby. Such action on the part of the Agent shall not constitute a waiver of
the Agent's rights and each Borrower's obligations under Section 2.10(b). Any
amount which is added to the principal balance of the Loan Account as provided
in this Section 2.8(e) shall bear interest at the interest rate then and
thereafter applicable to Prime Margin Loans.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Any statement
rendered by the Agent or any Revolving Credit Lender to the Lead Borrower
concerning the Liabilities shall be considered correct and accepted by each
Borrower and shall be conclusively binding upon each Borrower unless the Lead
Borrower provides the Agent with written objection thereto within twenty (20)
days from the mailing of such statement, which written objection shall indicate,
with particularity, the reason for such objection. The Loan Account and the
Agent's books and records concerning the loan arrangement contemplated herein
and the Liabilities shall be prima facie evidence and proof of the items
described therein.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.9. The Revolving Credit Notes.</B> The Borrowers' obligation to repay loans and
advances under the Revolving Credit, with interest as provided herein, shall be
evidenced by Notes (each, a <B>"Revolving Credit Note"</B>) in the form of
<B>EXHIBIT 2.10</B>, annexed hereto, executed by each Borrower, one payable to
each Revolving Credit Lender. Neither the original nor a copy of any Revolving
Credit Note shall be required, however, to establish or prove any Liability. In
the event that any Revolving Credit Note is ever lost, mutilated, or destroyed,
each Borrower shall execute a replacement thereof and deliver such replacement
to the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.10. Payment of The Loan Account.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrowers
may repay all or any portion of the principal balance of the Loan Account from
time to time until the Termination Date.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrowers,
without notice or demand from the Agent or any Revolving Credit Lender, shall
pay the Agent that amount, from time to time, which is necessary so that there
is no OverLoan outstanding.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Borrowers
shall repay the then entire unpaid balance of the Loan Account and all other
Liabilities on the Termination Date.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Agent shall
endeavor to cause the application of payments (if any), pursuant to Sections
2.11(a) and 2.11(b) against Libor Loans then outstanding in such manner as
results in the least cost to the Borrowers, but shall not have any affirmative
obligation to do so nor liability on account of the Agent's failure to have done
so. In no event shall action or inaction taken by the Agent excuse any Borrower
from any indemnification obligation under Section 2.10(e).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Borrowers
shall indemnify the Agent and each Revolving Credit Lender and hold the Agent
and each Revolving Credit Lender harmless from and against any loss, cost or
expense (including loss of anticipated profits and amounts payable by the Agent
or such Revolving Credit Lender on account of "breakage fees" (so-called)) which
the Agent or such Revolving Credit Lender may sustain or incur (including,
without limitation, by virtue of acceleration after the occurrence of any Event
of Default) as a consequence of the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Default by any Borrower in payment of the principal amount of or any
interest on any Libor Loan as and when due and payable, including any such loss
or expense arising from interest or fees payable by such Revolving Credit Lender
in order to maintain its Libor Loans.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Default by any Borrower in making a borrowing or conversion after the Lead
Borrower has given (or is deemed to have given) a request for a Revolving Credit
Loan or a request to convert a Revolving Credit Loan from one applicable
interest rate to another.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) The making of any payment on a Libor Loan or the making of any conversion
of any such Loan to a Prime Margin Loan on a day that is not the last day of the
applicable Interest Period with respect thereto.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.11. Interest on Revolving Credit Loans.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Revolving
Credit Loan shall bear interest at the Prime Margin Rate unless timely notice is
given (as provided in Section 2.5) that the subject Revolving Credit Loan (or a
portion thereof) is, or is to be converted to, a Libor Loan.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Revolving
Credit Loan which consists of a Libor Loan shall bear interest at the applicable
Libor Rate.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Subject to, and
in accordance with, the provisions of this Agreement, the Lead Borrower may
cause all or a part of the unpaid principal balance of the Loan Account to bear
interest at the Prime Margin Rate or the Libor Rate as specified from time to
time by the Lead Borrower by notice to the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) For ease of
reference and administration, each part of the Loan Account which bears interest
at the same rate interest and for the same Interest Period is referred to herein
as if it were a separate "Revolving Credit Loan".</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Lead
Borrower shall not select, renew, or convert any interest rate for a Revolving
Credit Loan such that, in addition to interest at the Prime Margin Rate, there
are more than Three (3) Libor Rates applicable to the Revolving Credit Loans at
any one time.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Borrowers
shall pay accrued and unpaid interest on each Revolving Credit Loan in arrears
as follows:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) On the
applicable Interest Payment Date for that Revolving Credit Loan.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) On the
Termination Date and on the End Date.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Following the
occurrence of any Event of Default, with such frequency as may be determined by
the Agent.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Following the
occurrence of any Event of Default (and whether or not the Agent exercises the
Agent's rights on account thereof), all Revolving Credit Loans shall bear
interest, at the option of the Agent or at the instruction of the SuperMajority
Lenders at rate which is the aggregate of the rate applicable to Prime Margin
Loans plus Two Percent (2%) per annum.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.12. Revolving Credit Closing Fee.</B> In consideration of the closing under this
Agreement and the commitment to make loans and advances to the Borrowers under
the Revolving Credit and to maintain sufficient funds available for such
purpose, there has been earned and the Borrowers shall pay the <B>"Revolving
Credit Closing Fee"</B> (so referred to herein) in the amount, and in the manner
specified in the Fee Letter.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.13. Unused Line Fee.</B> In addition to any other fee to be paid by the Borrowers
on account of the Revolving Credit, the Borrowers shall pay the Agent for the
benefit of the Revolving Credit Lenders the <B>"Unused Line Fee"</B> (so
referred to herein) of 0.30% per annum of the average difference, during the
month just ended (or relevant period with respect to the payment being made on
the Termination Date) between the Revolving Credit Ceiling and the aggregate of
the unpaid principal balance of the Loan Account and the undrawn Stated Amount
of L/C's outstanding during the relevant period. The Unused Line Fee shall be
paid in arrears, on the first day of each month after the execution of this
Agreement and on the Termination Date.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.14. Early Termination Fee.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In the event
that the Termination Date occurs prior to April 21, 2006 for any reason, the
Borrowers shall pay to the Agent, for the benefit of the Revolving Credit
Lenders, the <B>"Revolving Credit Early Termination Fee"</B> (so referred to
herein) in an amount equal to the product of (x) the Revolving Credit Ceiling,
multiplied by (y) One-half of one percent (.50%).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All parties to
this Agreement agree and acknowledge that the Revolving Credit Lenders will have
suffered damages on account of the early termination of the Revolving Credit and
that, in view of the difficulty in ascertaining the amount of such damages, that
the Early Termination Fee constitutes reasonable compensation and liquidated
damages to compensate Revolving Credit Lenders on account thereof.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.15. Monitoring Fee.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Borrowers shall pay to the Agent a &#147;<B>Monitoring Fee</B>&#148; (so
referred to herein) in the amount, and in the manner specified in the Fee
Letter.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.16. Concerning Fees.</B> The Borrowers shall not be entitled to any credit, rebate
or repayment of any fee earned by the Agent or any Revolving Credit Lender
pursuant to this Agreement or any Loan Document notwithstanding any termination
of this Agreement or suspension or termination of the Agent's and any Revolving
Credit Lender's respective obligation to make loans and advances
hereunder.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.17. Agent's and Revolving Credit Lenders' Discretion.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each reference
in the Loan Documents to the exercise of discretion or the like by the Agent or
any Revolving Credit Lender shall be to such Person's exercise of its judgment,
in good faith (which shall be presumed), based upon such information of which
that Person then has actual knowledge.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the exercise
of such discretion, the following may be taken into account.</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The reasonable
anticipation: of an adverse change to the value of the Collateral; the
enforceability of the Agent's Collateral Interests therein; or the amount which
the Agent would likely realize therefrom (taking into account delays which may
possibly be encountered in the Agent's realizing upon the Collateral and likely
Costs of Collection).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) The content,
completeness, and accuracy of any report or financial information delivered to
the Agent or any Revolving Credit Lender by or on behalf of any Borrower and the
manner by such report or financial information was prepared.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) The existence
of circumstances which suggest an increase in the likelihood that any Borrower
may become the subject of a bankruptcy or insolvency proceeding.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) The existence
of circumstances suggest that any Borrower is In Default.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the exercise
of such discretion, the Agent and each Revolving Credit Lender also may take
into account any of the following factors:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Those included in, or tested by, the definitions of "Eligible Accounts,"
"Eligible Inventory" and "Cost".</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) The current financial and business climate of the industry in which each
Borrower competes (having regard for that Borrower's position in that industry).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) General
macroeconomic conditions which have a material effect on the Borrowers' cost
structure.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) Material
changes in or to the mix of the Borrowers' Inventory.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (v) Seasonality
with respect to the Borrowers' Inventory and patterns of retail sales.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vi) Such other
factors as the Agent and each Revolving Credit Lender reasonably determine as
having a material bearing on credit risks associated with the providing of loans
and financial accommodations to the Borrowers.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The burden of
establishing the failure of the Agent or any Revolving Credit Lender to have
acted in a reasonable manner in such Person's exercise of such discretion shall
be the Borrowers' and may be made only by clear and convincing
evidence.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.18. Procedures For Issuance of L/C's.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Lead
Borrower may request that the Agent cause the issuance by the Issuer of L/C's
for the account of any Borrower. Each such request shall be in such manner as
may from time to time be acceptable to the Agent. Each request for the issuance
of an L/C, or the amendment, renewal, or extension of any outstanding L/C, shall
be made in writing by an officer duly authorized to act on behalf of the
Borrowers and delivered to the Agent via hand delivery, facsimile, or other
electronic method of transmission reasonably in advance of the requested date of
issuance, amendment, renewal, or extension. Each such request shall be in form
and substance satisfactory to the Agent in its discretion, and shall specify (i)
the amount of such L/C, (ii) the date of issuance, amendment, renewal, or
extension of such L/C, (iii) the expiration date of such L/C, (iv) the name and
address of the beneficiary thereof (or the beneficiary of the underlying L/C, as
applicable), and (v) such other information (including, in the case of an
amendment, renewal, or extension, identification of the outstanding L/C to be so
amended, renewed, or extended) as shall be necessary to prepare, amend, renew,
or extend such L/C.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent will
endeavor to cause the issuance of any L/C so requested by the Lead Borrower,
provided that, at the time that the request is made, the Revolving Credit has
not been suspended as provided in Section 2.6 and if so issued:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) The aggregate Stated Amount of all L/C's then outstanding, does not exceed
$90,000,000.00.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) The expiry of the L/C is not later than the earlier of Thirty (30) days
prior to the Maturity Date or the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(A) Standby's: One (1) year from initial issuance.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(B) Documentary's: One hundred twenty (120) days from issuance.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) If the expiry of an L/C is later than the Maturity Date, it is 103% cash
collateralized at its issuance.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) An OverLoan
will not result from the issuance of the subject L/C.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Borrower
shall execute such documentation to apply for and support the issuance of an L/C
as may be required by the Issuer.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) There shall not
be any recourse to, nor liability of, the Agent or any Revolving Credit Lender
on account of</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Any delay or refusal by an Issuer to issue an L/C;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Any action or inaction of an Issuer on account of or in respect to, any
L/C.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Borrowers
shall reimburse the Issuer for the amount of any honoring of a drawing under an
L/C on the same day on which such honoring takes place. The Agent, without the
request of any Borrower, may advance under the Revolving Credit (and charge to
the Loan Account) the amount of any honoring of any L/C and other amount for
which any Borrower, the Issuer, or the Revolving Credit Lenders become obligated
on account of, or in respect to, any L/C. Such advance shall be made whether or
not any Borrower is In Default or such advance would result in an OverLoan. Such
action shall not constitute a waiver of the Agent's rights under Section 2.11(b)
hereof.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.19. Fees For L/C's.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrower
shall pay to the Agent a fee for the benefit of the Revolving Credit Lenders, on
account of L/C's, the issuance of which had been procured by the Agent, monthly
in arrears, and on the Termination Date and on the End Date, equal to the
following percentage per annum of the weighted average Stated Amount of all
L/C's outstanding during the period in respect of which such fee is being paid
based upon the corresponding amount of Average Excess Availability as of the
date of determination.</FONT></P>

<PRE>
   ------------------------------------------------------------------------------------------------
             <B>Level      Standby Fee     Documentary Fee      Average Excess Availability</B>
   ------------------------------------------------------------------------------------------------
               I          1.75%           1.25%              Greater than $20,000,000.00
   ------------------------------------------------------------------------------------------------
              II          2.00%           1.50%              Less than or equal to $20,000,000.00
   ------------------------------------------------------------------------------------------------
</PRE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=90%>
The Standby Fee and the Documentary Fee on the Closing Date shall be established
at Level II for the initial fiscal quarter after the Closing Date and adjusted
at the end of each fiscal quarter thereafter based upon the amount of Average
Excess Availability. Following the occurrence of any Event of Default, such fee
shall be increased by Two percent (2%) per annum.
</TD>
<TD WIDTH=5% ALIGN=LEFT></TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In addition to
the fee to be paid as provided in Subsection 2.19(a), above, the Borrowers shall
pay to the Agent (or to the Issuer, if so requested by Agent), on demand, all
issuance, processing, negotiation, amendment, and administrative fees and other
amounts charged by the Issuer on account of, or in respect to, any L/C, as
provided in the Fee Letter.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If any change in
Applicable Law shall either:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) impose, modify or deem applicable any reserve, special deposit or similar
requirements against letters of credit heretofore or hereafter issued by any
Issuer or with respect to which any Revolving Credit Lender or any Issuer has an
obligation to lend to fund drawings under any L/C; or</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) impose on any Issuer any other condition or requirements relating to any
such letters of credit;</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>and the result of any event referred to in Section
2.19(c)(i) or 2.19(c)(ii), above, shall be to increase the cost to any Revolving
Credit Lender or to any Issuer of issuing or maintaining any L/C (which increase
in cost shall be the result of such Issuer&#146;s reasonable allocation among
that Revolving Credit Lender&#146;s or Issuer&#146;s letter of credit customers
of the aggregate of such cost increases resulting from such events), then, upon
demand by the Agent and delivery by the Agent to the Lead Borrower of a
certificate of an officer of the subject Revolving Credit Lender or the subject
Issuer describing such change in law, executive order, regulation, directive, or
interpretation thereof, its effect on such Revolving Credit Lender or such
Issuer, and the basis for determining such increased costs and their allocation,
the Borrowers shall immediately pay to the Agent, from time to time as specified
by the Agent, such amounts as shall be sufficient to compensate the subject
Revolving Credit Lender or the subject Issuer for such increased cost. Any
Revolving Credit Lender&#146;s or any Issuer&#146;s determination of costs
incurred under Section 2.19(c)(i) or 2.19(c)(ii), above, and the allocation, if
any, of such costs among the Borrowers and other letter of credit customers of
such Revolving Credit Lender or such Issuer, if done in good faith and made on
an equitable basis and in accordance with such officer&#146;s certificate, shall
be conclusive and binding on the Borrowers.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.20. Concerning L/C's.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) None of the
Issuer, the Issuer's correspondents, any Revolving Credit Lender, the Agent, or
any advising, negotiating, or paying bank with respect to any L/C shall be
responsible in any way for:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The performance
by any beneficiary under any L/C of that beneficiary's obligations to any
Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) The form,
sufficiency, correctness, genuineness, authority of any person signing;
falsification; or the legal effect of; any documents called for under any L/C if
(with respect to the foregoing) such documents on their face appear to be in
order.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Issuer may
honor, as complying with the terms of any L/C and of any drawing thereunder, any
drafts or other documents otherwise in order, but signed or issued by an
administrator, executor, conservator, trustee in bankruptcy, debtor in
possession, assignee for the benefit of creditors, liquidator, receiver, or
other legal representative of the party authorized under such L/C to draw or
issue such drafts or other documents.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Unless otherwise
agreed to, in the particular instance, each Borrower hereby authorizes any
Issuer to:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Select an
advising bank, if any.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Select a
paying bank, if any.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Select a
negotiating bank.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) All directions,
correspondence, and funds transfers relating to any L/C are at the risk of the
Borrowers. The Issuer shall have discharged the Issuer's obligations under any
L/C which, or the drawing under which, includes payment instructions, by the
initiation of the method of payment called for in, and in accordance with, such
instructions (or by any other commercially reasonable and comparable method).
None of the Agent, any Revolving Credit Lender, or the Issuer shall have any
responsibility for any inaccuracy, interruption, error, or delay in transmission
or delivery by post, telegraph or cable, or for any inaccuracy of
translation.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Agent's,
each Revolving Credit Lender's, and the Issuer's rights, powers, privileges and
immunities specified in or arising under this Agreement are in addition to any
heretofore or at any time hereafter otherwise created or arising, whether by
statute or rule of law or contract.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The obligations
of the Borrowers under this Agreement with respect to L/C's are absolute,
unconditional, and irrevocable and shall be performed strictly in accordance
with the terms hereof under all circumstances, whatsoever including, without
limitation, the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Any lack of validity or enforceability or restriction, restraint, or stay in
the enforcement of this Agreement, any L/C, or any other agreement or instrument
relating thereto.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Any Borrower's consent to any amendment or waiver of, or consent to the
departure from, any L/C.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) The existence of any claim, set-off, defense, or other right which any
Borrower may have at any time against the beneficiary of any L/C.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) Any good faith honoring of a drawing under any L/C, which drawing possibly
could have been dishonored based upon a strict construction of the terms of the
L/C.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.21. Changed Circumstances.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Agent may
advise the Lead Borrower that the Agent has made the good faith determination
(which determination shall be final and conclusive) of any of the
following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Adequate and
fair means do not exist for ascertaining the rate for Libor Loans.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) The continuation of or conversion of any Revolving Credit Loan to a Libor
Loan has been made impracticable or unlawful by the occurrence of a contingency
that materially and adversely affects the applicable market or the compliance by
the Agent or any Revolving Credit Lender in good faith with any Applicable Law.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) The indices on which the interest rates for Libor Loans are based shall no
longer represent the effective cost to the Agent or any Revolving Credit Lender
for U.S. dollar deposits in the interbank market for deposits in which it
regularly participates.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event
that the Agent advises the Lead Borrower of an occurrence described in Section
2.23(a), then, until the Agent notifies the Lead Borrower that the circumstances
giving rise to such notice no longer apply:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) The obligation of the Agent or each Revolving Credit Lender to make loans of
the type affected by such changed circumstances or to permit the Lead Borrower
to select the affected interest rate as otherwise applicable to any Revolving
Credit Loans shall be suspended.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Any notice which the Lead Borrower had given the Agent with respect to any
Libor Loan, the time for action with respect to which has not occurred prior to
the Agent's having given notice pursuant to Section 2.11(a), shall be deemed at
the option of the Agent to not having been given.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.22. Designation of Lead Borrower as Borrowers' Agent.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Borrower
hereby irrevocably designates and appoints the Lead Borrower as that Borrower's
agent to obtain loans and advances under the Revolving Credit, the proceeds of
which shall be available to each Borrower for those uses as those set forth in
Section 2.1(d). As the disclosed principal for its agent, each Borrower shall be
obligated to the Agent and each Revolving Credit Lender on account of loans and
advances so made under the Revolving Credit as if made directly by the Revolving
Credit Lenders to that Borrower, notwithstanding the manner by which such loans
and advances are recorded on the books and records of the Lead Borrower and of
any Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower
recognizes that credit available to it under the Revolving Credit is in excess
of and on better terms than it otherwise could obtain on and for its own account
and that one of the reasons therefor is its joining in the credit facility
contemplated herein with all other Borrowers. Consequently, each Borrower hereby
assumes and agrees to fully, faithfully, and punctually discharge all
Liabilities of all of the Borrowers.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Lead
Borrower shall act as a conduit for each Borrower (including itself, as a
"Borrower") on whose behalf the Lead Borrower has requested a Revolving Credit
Loan.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The proceeds of
each loan and advance provided under the Revolving Credit which is requested by
the Lead Borrower shall be deposited into the Operating Account or as otherwise
indicated by the Lead Borrower. The Lead Borrower shall cause the transfer of
the proceeds thereof to the (those) Borrower(s) on whose behalf such loan and
advance was obtained. Neither the Agent nor any Revolving Credit Lender shall
have any obligation to see to the application of such proceeds.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>2.23. Lenders' Commitments.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject to
Section 17.1 (which provides for assignments and assumptions of commitments),
each Revolving Credit Lender's <B>"Revolving Credit Percentage Commitment"</B>,
and <B>"Revolving Credit Dollar Commitment"</B> (respectively so referred to
herein) is set forth on <B>EXHIBIT 2.22</B>, annexed hereto.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The obligations
of each Revolving Credit Lender are several and not joint. No Revolving Credit
Lender shall have any obligation to make any loan under the Revolving Credit in
excess of either of the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) That Revolving Credit Lender's Revolving Credit Percentage Commitment of the
subject loan or advance or of Availability.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Any loan which, when aggregated with all other loans made by that Revolving
Credit Lender under the Revolving Credit and then outstanding, exceed that
Revolving Credit Lender's Revolving Credit Dollar Commitment.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Revolving
Credit Lender shall have any liability to the Borrowers on account of the
failure of any other Revolving Credit Lender to provide any loan or advance
under the Revolving Credit nor any obligation to make up any shortfall which may
be created by such failure.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Revolving
Credit Dollar Commitments, Revolving Credit Commitment Percentages, and
identities of the Revolving Credit Lenders may be changed, from time to time by
the reallocation or assignment of Revolving Credit Dollar Commitments and
Revolving Credit Commitment Percentages amongst the Revolving Credit Lenders or
with other Persons who determine to become "Revolving Credit Lenders", provided,
however unless an Event of Default has occurred (in which event, no consent of
any Borrower is required) any assignment to a Person not then a Revolving Credit
Lender shall be subject to the prior consent of the Lead Borrower (not to be
unreasonably withheld), which consent will be deemed given unless the Lead
Borrower provides the Agent with written objection, not more than Five (5)
Business Days after the Agent shall have given the Lead Borrower written notice
of a proposed assignment).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Upon written
notice given the Lead Borrower from time to time by the Agent, of any assignment
or allocation referenced in Section 2.23(d):</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Each Borrower shall execute one or more replacement Revolving Credit Notes
to reflect such changed Revolving Credit Dollar Commitments, Revolving Credit
Commitment Percentages, and identities and shall deliver such replacement
Revolving Credit Notes to the Agent (which promptly thereafter shall deliver to
the Lead Borrower the Revolving Credit Notes so replaced) provided however, in
the event that a Revolving Credit Note is to be exchanged following its
acceleration or the entry of an order for relief under the Bankruptcy Code with
respect to any Borrower, the Agent, in lieu of causing the Borrowers to execute
one or more new Revolving Credit Notes, may issue the Agent's Certificate
confirming the resulting Revolving Credit Dollar Commitments and Revolving
Credit Percentage Commitments.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Such change shall be effective from the effective date specified in such
written notice and any Person added as a Revolving Credit Lender shall have all
rights and privileges of a Revolving Credit Lender hereunder thereafter as if
such Person had been a signatory to this Agreement and any other Loan Document
to which a Revolving Credit Lender is a signatory and any Person removed as a
Revolving Credit Lender shall be relieved of any obligations or responsibilities
of a Revolving Credit Lender hereunder thereafter.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 3 Conditions Precedent:</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a condition to the effectiveness of this Agreement, the establishment of the
Revolving Credit, and the making of the first loan under the Revolving Credit,
each of the documents respectively described in Sections 3.1 through and
including 3.4, (each in form and substance satisfactory to the Agent) shall have
been delivered to the Agent, and the conditions respectively described in
Sections 3.5 through and including 3.9, shall have been satisfied:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.1. Corporate Due Diligence.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Certificates of
corporate good standing for each Borrower, respectively issued by the Secretary
of State for the state in which that Borrower is incorporated.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Certificates of
due qualification, in good standing, issued by the Secretary(ies) of State of
each State in which the nature a Borrower's business conducted or assets owned
could require such qualification.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Certificates of
each Borrower's Secretaries of the due adoption, continued effectiveness, and
setting forth the texts of, each corporate resolution adopted in connection with
the establishment of the loan arrangement contemplated by the Loan Documents and
attesting to the true signatures of each Person authorized as a signatory to any
of the Loan Documents.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.2. Opinion</B>. An opinion of counsel to the Borrowers in form and substance
satisfactory to the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.3. Additional Documents and Information.</B> Such additional instruments,
documents, and information as the Agent or its counsel reasonably may require or
request including, without limitation, the following:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Appraisal of the
Borrowers' Inventory.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Commercial
finance examination performed by the Agent's examiners and/or agents.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All Loan
Documents.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Lien search
results with respect to the Borrowers' locations.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Confirmation of
filing of all necessary and appropriate Financing Statements and such other
documents as may be required to perfect the Agent's and the Lenders' security
interest in the Collateral.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Receipt of
discharges, releases, and terminations required to afford the Agent and the
Lenders a first, perfected security interest in and to all Collateral, free and
clear of all liens and encumbrances, other than Permitted
Encumbrances.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Confirmation of
insurance and appropriate endorsements in favor of the Agent and the
Lenders.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Collateral
access agreements, as may be necessary.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Execution by all
parties of the definitive Disney License Agreement and confirmation that the
Disney License Agreement is in full force and effect.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Confirmation by
the Agent, in the Agent's sole and exclusive discretion, that all terms and
conditions of the Acquisition Agreement have been satisfied, and that all
conditions precedent to closing thereunder have been satisfied.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) Execution by all
parties and delivery to the Agent of the Designation.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.4. Officers' Certificates.</B> Certificates executed by the President and the
Chief Financial Officer of the Lead Borrower which state that</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Such officer,
acting on behalf of the Borrowers, has reviewed each of the Loan Documents and
has had the benefit of independent counsel (Attorneys Stroock &amp; Stroock
&amp; Lavan LLP) of the Lead Borrower's selection in connection with the review
and negotiation of the Loan Documents. In particular, and without limiting the
generality of such review, the following provisions of the Loan Documents have
been brought to the attention of the undersigned by such counsel:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) The waiver of the right to a trial by jury in connection with controversies
arising out of the loan arrangement contemplated by the Loan Documents.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) The designation of, and submission to the exclusive jurisdiction and venue
of, certain courts.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) Various other waivers and indemnifications included therein.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) The circumstances under which the Liabilities could be accelerated and the
grace periods available with respect to certain Events of Default.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The
representations and warranties made by the Borrowers to the Agent and the
Revolving Credit Lenders in the Loan Documents are true and complete as of the
date of such Certificate, and that no event has occurred which is or which,
solely with the giving of notice or passage of time (or both) would be an Event
of Default.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.5. Representations and Warranties.</B> Each of the representations made by or on
behalf of each Borrower in this Agreement or in any of the other Loan Documents
or in any other report, statement, document, or paper provided by or on behalf
of each Borrower shall be true and complete as of the date as of which such
representation or warranty was made.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.6. Minimum Day One Availability.</B> After giving effect to the first funding
under the Revolving Credit; all then held checks (if any); accounts payable
which are beyond credit terms then accorded the Borrowers; overdrafts; any
charges to the Loan Account made in connection with the establishment of the
credit facility contemplated hereby; and L/C's to be issued at, or immediately
subsequent to, such establishment, Availability shall not be less than
$7,000,000.00.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.7. All Fees and Expenses Paid.</B> All fees due at or immediately after the first
funding under the Revolving Credit and all costs and expenses incurred by the
Agent in connection with the establishment of the credit facility contemplated
hereby (including the fees and expenses of counsel to the Agent) shall have been
paid in full.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.8. No Borrower In Default.</B> No Borrower is In Default.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.9. No Adverse Change.</B> There has been no Material Adverse Change and no event
shall have occurred or failed to occur, which occurrence or failure is or could
have a materially adverse effect upon any Borrower's financial condition when
compared with such financial condition at October 31, 2004.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>3.10. Benefit of Conditions Precedent.</B> The conditions set forth in this
Article 3, are for the sole benefit of the Agent and each Revolving Credit
Lender and may be waived by the Agent in whole or in part without prejudice to
the Agent or any Revolving Credit Lender.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>No document shall be deemed delivered to the Agent or
any Revolving Credit Lender until received and accepted by the Agent at its
offices in Boston, Massachusetts. Under no circumstances shall this Agreement
take effect until executed and accepted by the Agent at said offices.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 4 General Representations, Covenants and
Warranties:</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To induce each Revolving Credit Lender to establish the credit facility
contemplated herein and to induce the Revolving Credit Lenders to provide loans
and advances under the Revolving Credit (each of which loans shall be deemed to
have been made in reliance thereupon) the Borrowers, in addition to all other
representations, warranties, and covenants made by any Borrower in any other
Loan Document, make those representations, warranties, and covenants included in
this Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.1. Payment and Performance of Liabilities.</B> The Borrowers shall pay each
payment Liability when due (or when demanded, if payable on demand) and shall
promptly, punctually, and faithfully perform each other Liability.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.2. Due Organization. Authorization. No Conflicts.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Borrower
presently is and hereafter shall remain in good standing as a corporation under
the laws of the State in which it is organized, as set forth in the Preamble to
this Agreement and is and shall hereafter remain duly qualified and in good
standing in every other State in which, by reason of the nature or location of
each Borrowers' assets or operation of each Borrowers' business, such
qualification may be necessary, except where the failure to so qualify would
have no more than a de minimis adverse effect on the business or a assets of any
Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower's
respective organizational identification number assigned to it by the State of
its incorporation and its respective federal employer identification number is
listed on <B>EXHIBIT 4.2</B>, annexed hereto.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Borrower
shall change its State of organization; any organizational identification number
assigned to that Borrower by that State; or that Borrowers' federal taxpayer
identification number.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Affiliate
is listed on EXHIBIT 4.2. The Lead Borrower shall provide the Agent with prior
written notice of any entity's becoming or ceasing to be an Affiliate.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Each Borrower
has all requisite power and authority to execute and deliver all Loan Documents
to which that Borrower is a party and has and will hereafter retain all
requisite power to perform all Liabilities.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The execution
and delivery by each Borrower of each Loan Document to which it is a party; each
Borrowers' consummation of the transactions contemplated by such Loan Documents
(including, without limitation, the creation of Collateral Interests by that
Borrower to secure the Liabilities); each Borrowers' performance under those of
the Loan Documents to which it is a party</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Have been duly authorized by all necessary action.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Do not, and will not, contravene in any material respect any provision of
any Requirement of Law or obligation of that Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) Will not result in the creation or imposition of, or the obligation to
create or impose, any Encumbrance upon any assets of that Borrower pursuant to
any Requirement of Law or obligation, except pursuant to the Loan Documents.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) The Loan
Documents have been duly executed and delivered by each Borrower and are the
legal, valid and binding obligations of each Borrower, enforceable against each
Borrower in accordance with their respective terms.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.3. Trade Names.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <B>EXHIBIT 4.3</B>,
annexed hereto, is a listing of:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) All names under which any Borrower ever conducted its business.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) All Persons with whom any Borrower ever consolidated or merged, or from
whom any Borrower ever acquired in a single transaction or in a series of
related transactions substantially all of such Person's assets.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Lead
Borrower will provide the Agent with not less than twenty-one (21) days prior
written notice (with reasonable particularity) of any change to any Borrowers'
name from that under which that Borrower is conducting its business at the
execution of this Agreement and will not effect such change unless each Borrower
is then in compliance with all provisions of this Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.4. Infrastructure.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Borrower
has and will maintain a sufficient infrastructure to conduct its business as
presently conducted and as contemplated to be conducted following its execution
of this Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower
owns and possesses, or has the right to use (and will hereafter own, possess, or
have such right to use) all patents, industrial designs, trademarks, trade
names, trade styles, brand names, service marks, logos, copyrights, trade
secrets, know-how, confidential information, and other intellectual or
proprietary property of any third Person necessary for that Borrower's conduct
of that Borrower's business.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The conduct by
each Borrower of that Borrower's business does not presently infringe (nor will
any Borrower conduct its business in the future so as to infringe) the patents,
industrial designs, trademarks, trade names, trade styles, brand names, service
marks, logos, copyrights, trade secrets, know-how, confidential information, or
other intellectual or proprietary property of any third Person.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.5.     Locations.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Collateral,
and the books, records, and papers of Borrowers' pertaining thereto, are kept
and maintained solely at those locations which are listed on <B>EXHIBIT 4.5</B>,
annexed hereto, which EXHIBIT includes, with respect to each such location, the
name and address of the landlord on the Lease which covers such location (or an
indication that a Borrower owns the subject location) and of all service bureaus
with which any such records are maintained.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No Borrower
shall remove any of the Collateral from those locations listed on EXHIBIT 4.5
except for the following purposes:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) To accomplish sales of Inventory in the ordinary course of business.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) To move Inventory from one such location to another such location.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii) To utilize such of the Collateral as is removed from such locations in the
ordinary course of business (such as motor vehicles).</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Borrower
will, other than in the ordinary course of business:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Execute, alter, modify, or amend any Lease.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Commit to, or open or close any location at which any Borrower maintains,
offers for sales, or stores any of the Collateral.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Except as
otherwise disclosed pursuant to, or permitted by, this Section 4.5, no tangible
personal property of any Borrower is in the care or custody of any third party
or stored or entrusted with a bailee or other third party and none shall
hereafter be placed under such care, custody, storage, or
entrustment.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.6. Encumbrances.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrowers
are, and shall hereafter remain, the owners of the Collateral free and clear of
all Encumbrances other than any Permitted Encumbrance.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No Borrower has,
and none shall have, possession of any property on consignment to that Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Borrower
shall acquire or obtain the right to use any Equipment, the acquisition or right
to use of which Equipment is otherwise permitted by this Agreement, in which
Equipment any third party has an interest, except for:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Equipment which is merely incidental to the conduct of that Borrowers'
business.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Equipment, the acquisition or right to use of which has been consented to
by the Agent, which consent may be conditioned upon the Agent's receipt of such
agreement with the third party which has an interest in such Equipment as is
satisfactory to the Agent.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.7. Indebtedness.</B> The Borrowers do not and shall not hereafter have any
Indebtedness other than any Permitted Indebtedness.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any Indebtedness
on account of the Revolving Credit.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Indebtedness
(if any) listed on <B>EXHIBIT 4.7</B>, annexed hereto.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Indebtedness
otherwise associated with the acquisition of Equipment otherwise in compliance
with the requirements of Section 4.6(c) and permitted by the capital expenditure
limitations imposed herein (Section 5.11).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.8. Insurance.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <B>EXHIBIT 4.8</B>,
annexed hereto, is a schedule of all insurance policies owned by the Borrowers
or under which any Borrower is the named insured. Each of such policies is in
full force and effect. Neither the issuer of any such policy nor any Borrower is
in default or violation of any such policy.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrowers
shall have and maintain at all times insurance covering such risks, in such
amounts, containing such terms, in such form, for such periods, and written by
such companies as may be satisfactory to the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All insurance
carried by the Borrowers shall provide for a minimum of Sixty (60) days' prior
written notice of cancellation to the Agent and all such insurance which covers
the Collateral shall</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Include an endorsement in favor of the Agent, which endorsement shall
provide that the insurance, to the extent of the Agent's interest therein, shall
not be impaired or invalidated, in whole or in part, by reason of any act or
neglect of any Borrower or by the failure of any Borrower to comply with any
warranty or condition of the policy.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Not include an endorsement in favor of any other Person.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The coverage
reflected on EXHIBIT 4.8 presently satisfies the foregoing requirements, it
being recognized by each Borrower, however, that such requirements may change
hereafter to reflect changing circumstances.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Lead
Borrower shall furnish the Agent from time to time with certificates or other
evidence satisfactory to the Agent regarding compliance by the Borrowers with
the foregoing requirements.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) In the event of
the failure by the Borrowers to maintain insurance as required herein, the
Agent, at its option and the Borrowers' expense, may obtain such insurance at
the expense of the Borrowers, provided, however, the Agent's obtaining of such
insurance shall not constitute a cure or waiver of any Event of Default
occasioned by the Borrowers' failure to have maintained such insurance.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) The Borrowers
shall maintain at all times those policies of insurance obtained by the
Borrowers and assigned to the Lender.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.9. Licenses.</B> The Disney License Agreement and each other license,
distributorship, franchise, and similar agreement issued to, or to which any
Borrower is a party is in full force and effect. No party to any such license or
agreement is in default or violation thereof. No Borrower has received any
notice or threat of cancellation of any such license or agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.10. Leases. EXHIBIT 4.10</B>, annexed hereto, is a schedule of all presently
effective Capital Leases. (Exhibit 4.5 includes a list of all other presently
effective Leases). Each of such Leases and Capital Leases is in full force and
effect. No party to any such Lease or Capital Lease is in default or violation
of any such Lease or Capital Lease. No Borrower has received any notice or
threat of cancellation of any such Lease or Capital Lease. Each Borrower hereby
authorizes the Agent at any time and from time to time to contact any of the
Borrowers' respective landlords in order to confirm the Borrowers' continued
compliance with the terms and conditions of the Lease(s) between the subject
Borrower and that landlord and to discuss such issues, concerning the subject
Borrower's occupancy under such Lease(s), as the Agent may determine.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.11. Requirements of Law.</B> Each Borrower is in compliance with, and shall
hereafter comply with and use its assets in compliance with, all Requirements of
Law except where the failure of such compliance will not have more than a de
minimis adverse effect on the Borrowers' business or assets. No Borrower has
received any notice of any violation of any Requirement of Law (other than of a
violation which has no more than a de minimis adverse effect on the Borrowers'
business or assets), which violation has not been cured or otherwise remedied.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>4.12. Labor
Relations.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Borrower has
been, and none is presently a party to any collective bargaining or other labor
contract.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) There is not
presently pending and, to any Borrower's knowledge, there is not threatened any
of the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Any strike, slowdown, picketing, work stoppage, or employee grievance
process.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Any proceeding
against or affecting any Borrower relating to the alleged violation of any
Applicable Law pertaining to labor relations or before National Labor Relations
Board, the Equal Employment Opportunity Commission, or any comparable
governmental body, organizational activity, or other labor or employment dispute
against or affecting any Borrower, which, if determined adversely to that
Borrower could have more than a de minimis adverse effect on that Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Any lockout
of any employees by any Borrower (and no such action is contemplated by any
Borrower).
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iv) Any application for the certification of a collective bargaining agent.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No event has
occurred or circumstance exists which could provide the basis for any work
stoppage or other labor dispute.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each
Borrower:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Has complied in
all material respects with all Applicable Law relating to employment, equal
employment opportunity, nondiscrimination, immigration, wages, hours, benefits,
collective bargaining, the payment of social security and similar taxes,
occupational safety and health, and plant closing.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Is not liable
for the payment of more than a de minimus amount of compensation, damages,
taxes, fines, penalties, or other amounts, however designated, for that
Borrower's failure to comply with any Applicable Law referenced in Section
4.12(d)(i).</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.13. Maintain Properties.</B> The Borrowers shall:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Keep the
Collateral in good order and repair (ordinary reasonable wear and tear and
insured casualty excepted).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Not suffer or
cause the waste or destruction of any material part of the Collateral.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Not use any of
the Collateral in violation of any policy of insurance thereon.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Not transfer any
material asset, material amount of cash, or other material proceeds of
Collateral to Hoop Holdings, LLC, except as permitted by Section 4.19 of this
Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Not sell, lease,
or otherwise dispose of any of the Collateral, other than the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The sale of
Inventory in compliance with this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) The disposal
of Equipment which is obsolete, worn out, or damaged beyond repair, which
Equipment is replaced to the extent necessary to preserve or improve the
operating efficiency of any Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Permitted
Dispositions.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) The turning
over to the Agent of all Receipts as provided herein.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.14. Taxes.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) With respect to
the Borrowers' federal, state, and local tax liability and
obligations:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The Lead
Borrower, in compliance with all Applicable Law, has properly filed all returns
due to be filed up to the date of this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Except as
described on <B>EXHIBIT 4.14</B>:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (A) At no time has
any Borrower received from any taxing authority any request to perform any
examination of or with respect to any Borrower nor any other written or verbal
notice in any way relating to any claimed failure by any Borrower to comply with
all Applicable Law concerning payment of any taxes or other amounts in the
nature of taxes.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (B) No agreement is
extant which waives or extends any statute of limitations applicable to the
right of any taxing authority to assert a deficiency or make any other claim for
or in respect to federal income taxes.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (C) No issue has
been raised in any tax examination of any Borrower which, by application of
similar principles, reasonably could be expected to result in the assertion of a
deficiency for any fiscal year open for examination, assessment, or claim by any
taxing authority.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrowers
have, and hereafter shall: pay, as they become due and payable, all taxes and
unemployment contributions and other charges of any kind or nature levied,
assessed or claimed against any Borrower or the Collateral by any person or
entity whose claim could result in an Encumbrance upon any asset of any Borrower
or by any governmental authority; properly exercise any trust responsibilities
imposed upon any Borrower by reason of withholding from employees' pay or by
reason of any Borrowers' receipt of sales tax or other funds for the account of
any third party; timely make all contributions and other payments as may be
required pursuant to any Employee Benefit Plan now or hereafter established by
any Borrower; and timely file all tax and other returns and other reports with
each governmental authority to whom any Borrower is obligated to so
file.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.15. No Margin Stock.</B> No Borrower is engaged in the business of extending
credit for the purpose of purchasing or carrying any margin stock (within the
meaning of Regulations U, T, and X of the Board of Governors of the Federal
Reserve System of the United States). No part of the proceeds of any borrowing
hereunder will be used at any time to purchase or carry any such margin stock or
to extend credit to others for the purpose of purchasing or carrying any such
margin stock.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.16. ERISA.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Neither any
Borrower nor any ERISA Affiliate has ever:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Violated or
failed to be in full compliance with any Borrower's Employee Benefit Plan.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Failed timely
to file all reports and filings required by ERISA to be filed by any
Borrower.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Engaged in
any nonexempt "prohibited transactions" or "reportable events" (respectively as
described in ERISA).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) Engaged in, or
committed, any act such that a tax or penalty reasonably could be imposed upon
any Borrower on account thereof pursuant to ERISA.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (v) Accumulate any
material cumulative funding deficiency within the meaning of ERISA.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vi) Terminated any
Employee Benefit Plan such that a lien could be asserted against any assets of
any Borrower on account thereof pursuant to ERISA.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vii) Been a member
of, contributed to, or have any obligation under any Employee Benefit Plan which
is a multiemployer plan within the meaning of Section 4001(a) of ERISA.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Neither any
Borrower nor any ERISA Affiliate shall ever engage in any action of the type
described in Section 4.16(a).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.17. Hazardous Materials.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Borrower has
ever: (i) been legally responsible for any release or threat of release of any
Hazardous Material or (ii) received notification of the incurrence of any
expense in connection with the assessment, containment, or removal of any
Hazardous Material for which that Borrower would be responsible.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower
shall: (i) dispose of any Hazardous Material only in compliance with all
Environmental Laws and (ii) have possession of any Hazardous Material only in
the ordinary course of that Borrowers' business and in compliance with all
Environmental Laws.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.18. Litigation.</B> Except as described in <B>EXHIBIT 4.18</B>, annexed
hereto, there is not presently pending or threatened by or against any Borrower
any suit, action, proceeding, or investigation which, if determined adversely to
any Borrower, would have more than a de minimis adverse effect upon a Borrower's
financial condition or ability to conduct its business as such business is
presently conducted or is contemplated to be conducted in the foreseeable
future.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.19. Dividends. Investments. Corporate Action.</B> No Borrower shall:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Pay any cash
dividend or make any other distribution in respect of any class of that
Borrower's capital stock, except for: (i) dividends permitted by, and made in
accordance with Section 9.13.3(b) of the License Agreement to make payments due
under the "Tax Sharing Agreement" or "Intercompany Services Agreement" to which
the Borrowers are parties, or to repay that portion of the working capital
adjustment paid by The Children's Place Retail Stores, Inc., and (ii) the
investment of funds by Hoop Retail Stores, LLC or The Disney Store, LLC into and
for the benefit of Hoop Canada, Inc. or The Disney Store (Canada) Ltd. in an
amount not to exceed $5,000,000.00 in the aggregate at any one time, or the
making of dividends by Hoop Canada, Inc. and/or Hoop Canada Holdings, Inc.
directly or indirectly to and for the benefit of Hoop Retail Stores, LLC or The
Disney Store, LLC.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Make any payment
on account of any Indebtedness other than payment of the Liabilities (other than
Indebtedness owed by one Borrower to another Borrower).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Own, redeem,
retire, purchase, or acquire any of any Borrower's capital stock.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Invest in or
purchase any stock or securities or rights to purchase any such stock or
securities, of any Person other than a Permitted Investment.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Merge or
consolidate or be merged or consolidated with or into any other corporation or
other entity, other than with respect to the Permitted Mergers.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Consolidate any
of that Borrower's operations with those of any other Person other than of
another Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Organize or
create any Affiliate.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Subordinate any
debts or obligations owed to that Borrower by any third party to any other debts
owed by such third party to any other Person.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Acquire any
assets other than in the ordinary course and conduct of that Borrower's business
as conducted at the execution of this Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.20. Loans.</B> No Borrower shall make any loans or advances to, nor acquire the
Indebtedness of, any Person, provided, however, the foregoing does not prohibit
any of the following:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Advance payments
made to that Borrower's suppliers in the ordinary course.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Advances to that
Borrower's officers, employees, and salespersons with respect to reasonable
expenses to be incurred by such officers, employees, and salespersons for the
benefit of that Borrower, which expenses are properly substantiated by the
person seeking such advance and properly reimbursable by that Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Advances
permitted pursuant to Section 4.7(b) of this Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.21. Protection of Assets.</B> The Agent, in the Agent's discretion, and from time
to time, may discharge any tax or Encumbrance on any of the Collateral, or take
any other action which the Agent may deem necessary or desirable to repair,
insure, maintain, preserve, collect, or realize upon any of the Collateral. The
Agent shall not have any obligation to undertake any of the foregoing and shall
have no liability on account of any action so undertaken except where there is a
specific finding in a judicial proceeding (in which the Agent has had an
opportunity to be heard), from which finding no further appeal is available,
that the Agent had acted in actual bad faith or in a grossly negligent manner.
The Borrowers shall pay to the Agent, on demand, or the Agent, in its
discretion, may add to the Loan Account, all amounts paid or incurred by the
Agent pursuant to this Section 4.21.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.22. Line of Business.</B> No Borrower shall engage in any business other than the
business in which it is currently engaged or a business reasonably related
thereto.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.23. Affiliate Transactions.</B> No Borrower shall make any payment, nor give any
value to any Affiliate except for goods and services actually purchased by that
Borrower from, or sold by that Borrower to, such Affiliate for a price and on
terms which shall</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) be competitive
and fully deductible as an "ordinary and necessary business expense" and/or
fully depreciable under the Internal Revenue Code of 1986 and the Treasury
Regulations, each as amended; and</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) be no less
favorable to that Borrower than those which would have been charged and imposed
in an arms length transaction.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.24. Executive Pay.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The only
Executive Officers of the Borrowers, at the execution of this Agreement, are
those individuals referenced in the definition of "Executive Officers", above.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Prior to the
execution of this Agreement, the Lead Borrower furnished the Agent with copies
of all written Executive Agreements and outlines of the salient features of all
unwritten Executive Agreements (as amended to date) then extant. There are no
unwritten agreements or understandings between any Borrower and any Executive
Officer which relate to Executive Pay, written disclosure of which has not been
made to the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Borrower
will:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Enter into any
Executive Agreement not extant at the execution of this Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Alter, amend, supplement, or otherwise change any Executive Agreement.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Pay, provide,
or facilitate any Executive Pay other than as provided in an Executive Agreement
or, if not covered by an Executive Agreement, as permitted pursuant to Section
4.23 hereof.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.25. Further Assurances.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Borrower is
the owner of, nor has it any interest in, any property or asset which not be
subject to a perfected Collateral Interest in favor of the Agent (subject only
to Permitted Encumbrances) to secure the Liabilities, other than the License
Agreement and each of the other assets specifically excluded from the definition
of Collateral as set forth in Section 8.1 of this Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No Borrower will
hereafter acquire any asset or any interest in property which is not,
immediately upon such acquisition, subject to such a perfected Collateral
Interest in favor of the Agent to secure the Liabilities (subject only to
Permitted Encumbrances).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Borrower
shall execute and deliver to the Agent such instruments, documents, and papers,
and shall do all such things from time to time hereafter as the Agent may
request to carry into effect the provisions and intent of this Agreement; to
protect and perfect the Agent's Collateral Interests in the Collateral; and to
comply with all applicable statutes and laws, and facilitate the collection of
the Receivables Collateral. Each Borrower shall execute all such instruments as
may be required by the Agent with respect to the recordation and/or perfection
of the Collateral Interests created or contemplated herein.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Borrower
hereby designates the Agent as and for that Borrowers' true and lawful attorney,
with full power of substitution, to sign and file any financing statements in
order to perfect or protect the Agent's Collateral Interests in the Collateral.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) This Agreement
constitutes an authenticated record which authorizes the Agent to file such
financing statements as the Agent determines as appropriate to perfect or
protect the Collateral Interests created by this Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) A carbon,
photographic, or other reproduction of this Agreement or of any financing
statement or other instrument executed pursuant to this Section 4.25 shall be
sufficient for filing to perfect the security interests granted herein.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.26. Adequacy of Disclosure.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All financial
statements furnished to the Agent and to each Revolving Credit Lender by each
Borrower have been prepared in accordance with GAAP consistently applied and
present fairly the condition of the Borrowers at the date(s) thereof and the
results of operations and cash flows for the period(s) covered (provided
however, that unaudited financial statements are subject to normal year end
adjustments and to the absence of footnotes). There has been no change in the
Consolidated financial condition, results of operations, or cash flows of the
Borrowers since the date(s) of such financial statements, other than changes in
the ordinary course of business, which changes have not been materially adverse,
either singularly or in the aggregate.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No Borrower has
any contingent obligations or obligation under any Lease or Capital Lease which
is not noted in the Borrowers' Consolidated financial statements furnished to
the Agent and to each Revolving Credit Lender prior to the execution of this
Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No document,
instrument, agreement, or paper now or hereafter given to the Agent or to any
Revolving Credit Lender by or on behalf of each Borrower or any guarantor of the
Liabilities in connection with the execution of this Agreement by the Agent and
to each Revolving Credit Lender contains or will contain any untrue statement of
a material fact or omits or will omit to state a material fact necessary in
order to make the statements therein not misleading. There is no fact known to
any Borrower which has, or which, in the foreseeable future could have, a
material adverse effect on the financial condition of any Borrower or any such
guarantor which has not been disclosed in writing to the Agent and to each
Revolving Credit Lender.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.27. No Restrictions on Liabilities.</B> Except as may contemplated by, and in
accordance with the Disney License Agreement, no Borrower shall enter into or
directly or indirectly become subject to any agreement which prohibits or
restricts, in any manner, any Borrowers':</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Creation of, and
granting of Collateral Interests in favor of the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Incurrence of
Liabilities.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>4.28. Other Covenants.</B> No Borrower shall indirectly do or cause to be done any
act which, if done directly by that Borrower, would breach any covenant
contained in this Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 5 Financial Reporting and Performance
Covenants:</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.1. Maintain Records.</B> The Borrowers shall:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) At all times,
keep proper books of account, in which full, true, and accurate entries shall be
made of all of the Borrowers' financial transactions, all in accordance with
GAAP applied consistently with prior periods to fairly reflect the Consolidated
financial condition of the Borrowers at the close of, and its results of
operations for, the periods in question.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Timely provide
the Agent with those financial reports, statements, and schedules required by
this Article 5 or otherwise, each of which reports, statements and schedules
shall be prepared, to the extent applicable, in accordance with GAAP applied
consistently with prior periods to fairly reflect the Consolidated financial
condition of the Borrowers at the close of, and the results of operations for,
the period(s) covered therein.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) At all times,
keep accurate current records of the Collateral including, without limitation,
accurate current stock, cost, and sales records of its Inventory, accurately and
sufficiently itemizing and describing the kinds, types, and quantities of
Inventory and the cost and selling prices thereof.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) At all times,
retain independent certified public accountants who are reasonably satisfactory
to the Agent and instruct such accountants to fully cooperate with, and be
available to, the Agent to discuss the Borrowers' financial performance,
financial condition, operating results, controls, and such other matters, within
the scope of the retention of such accountants, as may be raised by the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Not change any
Borrower's fiscal year.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.2. Access to Records.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Borrower
shall afford the Agent with access from time to time as the Agent may require to
all properties owned by or over which any Borrower has control. The Agent shall
have the right, and each Borrower will permit the Agent from time to time as
Agent may request, to examine, inspect, copy, and make extracts from any and all
of the Borrowers' books, records, electronically stored data, papers, and files.
Each Borrower shall make all of that Borrower's copying facilities available to
the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower
hereby authorizes the Agent to:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) Inspect, copy, duplicate, review, cause to be reduced to hard copy, run off,
draw off, and otherwise use any and all computer or electronically stored
information or data which relates to any Borrower, or any service bureau,
contractor, accountant, or other person, and directs any such service bureau,
contractor, accountant, or other person fully to cooperate with the Agent with
respect thereto.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(ii) Verify at any time the Collateral or any portion thereof, including
verification with Account Debtors, and/or with each Borrower's computer billing
companies, collection agencies, and accountants and to sign the name of each
Borrower on any notice to each Borrower's Account Debtors or verification of the
Collateral.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent from
time to time may designate one or more representatives to exercise the Agent's
rights under this Section 5.2 as fully as if the Agent were doing so.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.3. Immediate Notice to Agent.</B> The Lead Borrower shall provide the Agent with
written notice promptly upon the occurrence of any of the following events,
which written notice shall be with reasonable particularity as to the facts and
circumstances in respect of which such notice is being given:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any change in
any Borrower's President, chief executive officer, chief operating officer, and
chief financial officer (without regard to the title(s) actually given to the
Persons discharging the duties customarily discharged by officers with those
titles).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any ceasing of
any Borrower's making of payment, in the ordinary course, to any of its
creditors (other than its ceasing of making of such payments on account of a de
minimis dispute).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any failure by
any Borrower to pay rent at any of that Borrower's locations, which failure
continues for more than Twenty-one (21) days following the last day on which
such rent was payable without more than a de minimis adverse effect to that
Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Any Material
Adverse Change in the business, operations, or financial affairs of any
Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Any Borrower's
becoming In Default.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Any intention on
the part of any Borrower to discharge that Borrower's present independent
accountants or any withdrawal or resignation by such independent accountants
from their acting in such capacity (as to which, see Subsection 5.1(d)).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Any litigation
which, if determined adversely to any Borrower, might have a material adverse
effect on the financial condition of that Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.4. Borrowing Base Certificate.</B> The Lead Borrower shall provide the Agent by
12:30 p.m., daily, with a Borrowing Base Certificate (in the form of <B>EXHIBIT 5.4</B>
annexed hereto, as such form may be revised from time to time by the Agent).
Such Certificate may be sent to the Agent by facsimile transmission, provided
that the original thereof is forwarded to the Agent on the date of such
transmission.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.5. Weekly Reports.</B> Weekly, on Tuesday of each week (as of the then immediately
preceding Saturday) the Lead Borrower shall provide the Agent with a sales audit
report and a flash collateral report (each in such form as may be specified from
time to time by the Agent). Such report may be sent to the Agent by facsimile
transmission, provided that the original thereof is forwarded to the Agent on
the date of such transmission.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.6. Monthly Reports.</B> Monthly, the Lead Borrower shall provide the Agent with
those financial statements and reports described in <B>EXHIBIT 5.6</B>, annexed
hereto.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.7. Annual Reports.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Annually, in
addition to the timely submission of the monthly reporting required at the end
of every month, within ninety (90) days following the end of the Borrowers'
fiscal year, the Lead Borrower shall furnish the Agent with an original signed
counterpart of the Borrowers' Consolidated annual financial statement, which
statement shall have been prepared by, and bear the unqualified opinion of, the
Lead Borrower's independent certified public accountants (i.e. said statement
shall be "certified" by such accountants) and shall include, at a minimum (with
comparative information for the then prior fiscal year) a balance sheet, income
statement, statement of changes in shareholders' equity, cash flows, and
schedules of consolidation.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No later than
the earlier of Fifteen (15) days prior to the end of each of the Borrowers'
fiscal years or the date on which such accountants commence their work on the
preparation of the Borrowers' annual financial statement, the Lead Borrower
shall give written notice to such accountants (with a copy of such notice, when
sent, to the Agent) that:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Such annual
financial statement will be delivered by the Lead Borrower to the Agent (for
subsequent distribution to each Revolving Credit Lender).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) It is the
primary intention of the Borrowers, in its engagement of such accountants, to
satisfy the financial reporting requirements set forth in this Article 5.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) The Lead
Borrower has been advised that the Agent and each Revolving Credit Lender will
rely thereon with respect to the administration of, and transactions under, the
credit facility contemplated by this Agreement.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each annual
statement shall be accompanied by such accountant's Certificate indicating that,
in conducting the audit for such annual statement, nothing came to the attention
of such accountants to believe that the Borrower is not In Default (or that if
the Borrower is in Default, the facts and circumstances thereof).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.8. Officers' Certificates.</B> The Lead Borrower shall cause either the Lead
Borrower's President or its Chief Financial Officer, in each instance, to
provide such Person's Certificate with those monthly financial statements to be
provided within Thirty (30) days of the end of each month and with those to be
provided quarterly and annual statements to be furnished pursuant to this
Agreement, which Certificate shall:</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Indicate that
the subject statement was prepared in accordance with GAAP consistently applied
and presents fairly the Consolidated financial condition of the Borrowers at the
close of, and the results of the Borrowers' operations and cash flows for, the
period(s) covered, subject, however to the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Usual year end
adjustments (this exception shall not be included in the Certificate which
accompanies such annual statement).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Material
Accounting Changes (in which event, such Certificate shall include a schedule
(in reasonable detail) of the effect of each such Material Accounting Change)
not previously specifically taken into account in the determination of the
financial performance covenant imposed pursuant to Section 5.11.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Indicate either
that (i) no Borrower is In Default, or (ii) if such an event has occurred, its
nature (in reasonable detail) and the steps (if any) being taken or contemplated
by the Borrowers to be taken on account thereof.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Include
calculations concerning the Borrowers' compliance (or failure to comply) at the
date of the subject statement with each of the financial performance covenants
included in Section 5.11 hereof.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Include
confirmation that all of the Borrowers' taxes, insurance premiums, and rental
payments are current in all respects.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.9. Inventories, Appraisals, and Audits.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Agent, at
the expense of the Borrowers, may participate in and/or observe each physical
count and/or inventory of so much of the Collateral as consists of Inventory
which is undertaken on behalf of any Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrowers,
at their own expense, shall cause not less than One (1) physical inventories to
be undertaken with respect to each of the Borrowers' store locations, in each
Twelve (12) month period during which this Agreement is in effect (the
scheduling of which shall be subject to the Agent's discretion) conducted by
such inventory takers as are satisfactory to the Agent and following such
methodology as may be satisfactory to the Agent.</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(i) The Lead Borrower shall provide the Agent with a copy of the preliminary
results of each such inventory (as well as of any other physical inventory
undertaken by any Borrower) within Ten (10) days following the completion of
such inventory.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) The Lead
Borrower, within Thirty (30) days following the completion of such inventory,
shall provide the Agent with a reconciliation of the results of each such
inventory (as well as of any other physical inventory undertaken by any
Borrower) and shall post such results to the Borrowers' stock ledger and, as
applicable to the Borrowers' other financial books and records .</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) The Agent, in
its discretion, if any Borrower is In Default, may cause such additional
inventories to be taken as the Agent determines (each, at the expense of the
Borrowers).</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent
contemplates conducting up to Three (3) appraisals of the Collateral during any
Twelve (12) month period, but in its discretion may obtain additional appraisals
of the Collateral, from time to time (in all events, at the Borrowers' expense)
conducted by such appraisers as are satisfactory to the Agent during such
period.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Agent
contemplates conducting up to Three (3) commercial finance field examinations
(in each event, at the Borrowers' expense) of the Borrowers' books and records
during any Twelve (12) month period during which this Agreement is in effect,
but in its discretion, may undertake additional such audits (likewise at the
Borrower's expense) during such period.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.10. Additional Financial Information.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In addition to
all other information required to be provided pursuant to this Article 5, the
Lead Borrower promptly shall provide the Agent (and any guarantor of the
Liabilities), with such other and additional information concerning the
Borrowers, the Collateral, the operation of the Borrowers' business, and the
Borrowers' financial condition, including original counterparts of financial
reports and statements, as the Agent may from time to time request from the Lead
Borrower.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Lead
Borrower may provide the Agent, from time to time hereafter, with updated
forecasts of the Borrowers' anticipated performance and operating results.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In all events,
the Lead Borrower, no sooner than Ninety (90) nor later than Thirty (30) days
prior to the end of each of the Borrowers' fiscal years, shall provide the Agent
with an updated and extended forecast which shall go out at least through the
end of the then next fiscal year and shall include an income statement, balance
sheet, and statement of cash flow, by month, each Consolidated (with
consolidating schedules) and each prepared in conformity with GAAP and
consistent with the Borrowers' then current practices.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Agent,
following the receipt of any of such forecast, may, but shall not be under any
obligation to, provide its written sign-off on such forecast (in which event,
such forecast shall become the Business Plan) and if it provides such written
sign-off, may by written notice to the Lead Borrower, extend or revise the
financial performance covenants included on EXHIBIT 5.11, annexed hereto.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) In the event
that the Agent does not provide its sign-off with respect to the updated and
extended forecast to be provided at year-end pursuant to Section 5.10(c), above,
then the Agent, by written notice to the Lead Borrower, may revise, roll-over,
or extend, for the then coming fiscal year, the financial performance covenants
applicable to the Borrowers pursuant to Section 5.11 hereof by extrapolation
from the Business Plan.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Each Borrower
recognizes that all appraisals, inventories, analysis, financial information,
and other materials which the Agent may obtain, develop, or receive with respect
to the Borrowers are confidential to the Agent and that, except as otherwise
provided herein, no Borrower is entitled to receipt of any of such appraisals,
inventories, analysis, financial information, and other materials, nor copies or
extracts thereof or therefrom.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>5.11. Financial Performance Covenants.</B> The Borrowers shall observe and comply
with those financial performance covenants set forth on <B>EXHIBIT 5.11(a)</B>, annexed
hereto, certain of which covenants are based on the Business Plan set forth on
<B>EXHIBIT 5.11(b)</B>, annexed hereto. Such financial performance covenants are
subject to change, revision, roll over, and extension as provided in Section
5.10(d) hereof. Compliance with such financial performance covenants shall be
made as if no Material Accounting Changes had been made (other than any Material
Accounting Changes specifically taken into account in the setting of such
covenants). The Agent may determine the Borrowers' compliance with such
covenants based upon financial reports and statements provided by the Lead
Borrower to the Agent (whether or not such financial reports and statements are
required to be furnished pursuant to this Agreement) as well as by reference to
interim financial information provided to, or developed by, the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 6 Use of Collateral:</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.1. Use of Inventory Collateral.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Borrower
shall engage in any of the following with respect to its Inventory:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Any sale other
than</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (A) for fair
consideration in the conduct of the Borrowers' business in the ordinary course
or,</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10% ALIGN=LEFT></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (B) a Permitted
Disposition.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Sales or other
dispositions to creditors.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) Sales or
other dispositions in bulk (other than as part of a Permitted Disposition).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) Sales of any
Collateral in breach of any provision of this Agreement.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No sale of
Inventory shall be on consignment, approval, or under any other circumstances
such that, such Inventory may be returned to a Borrower without the consent of
the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.2. Inventory Quality.</B> All Inventory now owned or hereafter acquired by each
Borrower is and will be of good and merchantable quality and free from defects
(other than defects within customary trade tolerances).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.3. Adjustments and Allowances.</B> Each Borrower may grant such allowances or
other adjustments to that Borrower's Account Debtors (exclusive of extending the
time for payment of any Account or Account Receivable, which shall not be done
without first obtaining the Agent's prior written consent in each instance) as
that Borrower may reasonably deem to accord with sound business practice,
provided, however, the authority granted the Borrowers pursuant to this Section
6.3 may be limited or terminated by the Agent at any time in the Agent's
discretion.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.4. Validity of Accounts.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a) The amount of
each Account shown on the books, records, and invoices of the Borrowers
represented as owing by each Account Debtor is and will be the correct amount
actually owing by such Account Debtor and shall have been fully earned by
performance by the Borrowers.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent from
time to time may verify the Receivables Collateral directly with the Borrowers'
Account Debtors, such verification to be undertaken in keeping with commercially
reasonable commercial lending standards.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Borrower has
any knowledge of any impairment of the validity or collectability of any of the
Accounts. The Lead Borrower shall notify the Agent of any such impairment
immediately after any Borrower becomes aware of any such impairment.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) No Borrower
shall post any bond to secure any Borrower's performance under any agreement to
which any Borrower is a party nor cause any surety, guarantor, or other third
party obligee to become liable to perform any obligation of any Borrower (other
than to the Agent) in the event of any Borrower's failure so to perform.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.5. Notification to Account Debtors.</B> The Agent shall have the right (whether or
not an Event of Default has occurred) to notify any of the Borrowers' Account
Debtors to make payment directly to the Agent and to collect all amounts due on
account of the Collateral.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 7 Cash Management. Payment of Liabilities:</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.1. The Blocked, and Operating Accounts.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The following
checking accounts have been or will be established (and are so referred to
herein):</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The "Blocked
Account" (so referred to herein): Established by the Borrower with Wachovia
Bank.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) The "Operating
Account" (so referred to herein): Established by the Borrower with Wachovia
Bank.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The contents of
each DDA (other than the Operating Account) and of the Blocked Account
constitutes Collateral and Proceeds of Collateral.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Borrowers
shall pay all fees and charges of, and maintain such impressed balances as may
be required by the depository in which any account is opened as required hereby
(even if such account is opened by and/or is the property of the
Agent).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.2. Proceeds and Collections.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All Receipts and
all cash proceeds of any sale or other disposition of any of each Borrower's
assets:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Constitute
Collateral and proceeds of Collateral.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Shall be held
in trust by the Borrowers for the Agent.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) After deposit
into a DDA, if applicable, shall be transferred only to the Blocked
Account.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Lead
Borrower shall cause the ACH or wire transfer to the Blocked Account, not less
frequently than daily (except in a circumstance, as confirmed in writing by the
Agent, in the Agent's sole and exclusive discretion, where (x) remaining
Availability is greater than $20,000,000.00, and (y) the Borrowers are not In
Default and/or no Event of Default has occurred) of the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) The then
contents of each DDA (other than any Exempt DDA), each such transfer to be net
of any minimum balance, not to exceed $1,000.00, as may be required to be
maintained in the subject DDA by the bank at which such DDA is maintained.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) The proceeds
of all credit card charges not otherwise provided for pursuant hereto.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(iii)
Telephone advice (confirmed by written notice) shall be provided to the Agent on
each Business Day on which any such transfer is made.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the event
that, notwithstanding the provisions of this Section 7.2, any Borrower receives
or otherwise has dominion and control of any Receipts, or any proceeds or
collections of any Collateral, such Receipts, proceeds, and collections shall be
held in trust by that Borrower for the Agent and shall not be commingled with
any of that Borrower's other funds or deposited in any account of any Borrower
other than as instructed by the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.3. Payment of Liabilities.</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On each Business
Day, the Agent shall apply the then collected balance of the Blocked Account
(net of fees charged, and of such impressed balances as may be required by the
bank at which the Blocked Account is maintained) towards the unpaid balance of
the Loan Account and all other Liabilities; provided, however, for purposes of
the calculation of interest on the unpaid principal balance of the Loan Account,
such payment shall be deemed to have been made One (1) Business Day after such
transfer.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The following
rules shall apply to deposits and payments under and pursuant to this Section
7.3:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i) Funds shall be
deemed to have been deposited to the Blocked Account on the Business Day on
which deposited, provided that notice of such deposit is available to the Agent
by 2:00PM on that Business Day.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii) Funds paid to
the Agent, other than by deposit to the Blocked Account, shall be deemed to have
been received on the Business Day when they are good and collected funds,
provided that notice of such payment is available to the Agent by 2:00PM on that
Business Day.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii) If notice of
a deposit to the Blocked Account (Section 7.3(b)(i) or payment (Section
7.3(b)(ii)) is not available to the Agent until after 2:00PM on a Business Day,
such deposit or payment shall be deemed to have been made at 9:00AM on the then
next Business Day.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv) All deposits
to the Blocked Account and other payments to the Agent are subject to clearance
and collection.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent shall
transfer to the Operating Account any surplus in the Blocked Account remaining
after the application towards the Liabilities referred to in Section 7.3(a),
above (less those amount which are to be netted out, as provided therein)
provided, however, in the event that</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any Borrower is In Default; and<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) one or more L/C's are then outstanding,</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>then the Agent may establish a funded reserve of up to 103% of the aggregate
Stated Amounts of such L/C&#146;s. Such funded reserve shall either be (i)
returned to the Lead Borrower provided that no Borrower is In Default or (ii)
applied towards the Liabilities following the occurrence of any Event of Default
described in Section 10.11 or acceleration following the occurrence of any other
Event of Default.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.4. The Operating Account.</B> Except as otherwise specifically provided in, or
permitted by, this Agreement, all checks shall be drawn by the Lead Borrower
upon, and other disbursements shall be made by the Lead Borrower solely from,
the Operating Account.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 8 Grant of Security Interest:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>8.1. Grant of Security Interest.</B> To secure the Borrowers' prompt, punctual, and
faithful performance of all and each of the Liabilities, each Borrower hereby
grants to the Agent, for the ratable benefit of the Revolving Credit Lenders, a
continuing security interest in and to, and assigns to the Agent, for the
ratable benefit of the Revolving Credit Lenders, the following, and each item
thereof, whether now owned or now due, or in which that Borrower has an
interest, or hereafter acquired, arising, or to become due, or in which that
Borrower obtains an interest, and all products, Proceeds, substitutions, and
accessions of or to any of the following (all of which, together with any other
property in which the Agent may in the future be granted a security interest, is
referred to herein as the <B>"Collateral"</B>):</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
All Accounts and accounts receivable.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All Inventory.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All General Intangibles.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) All Equipment.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) All Goods.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) All Fixtures.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) All Chattel Paper.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) All Letter-of-Credit Rights.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) All Payment Intangibles.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) All Supporting Obligations.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) All books,
records, and information relating to the Collateral and/or to the operation of
each Borrowers' business, and all rights of access to such books, records, and
information, and all property in which such books, records, and information are
stored, recorded, and maintained.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) All Leasehold Interests.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) All Investment
Property, Instruments, Documents, Deposit Accounts, money, policies and
certificates of insurance, deposits, impressed accounts, compensating balances,
cash, or other property.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) All insurance
proceeds, refunds, and premium rebates, including, without limitation, proceeds
of fire and credit insurance, whether any of such proceeds, refunds, and premium
rebates arise out of any of the foregoing. (8.1(a)) through 8.1(m)) or
otherwise.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) All liens,
guaranties, rights, remedies, and privileges pertaining to any of the foregoing
(8.1(a)) through 8.1(n)), including the right of stoppage in transit.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=95%><FONT SIZE=3>The foregoing notwithstanding, none of the following
shall be part of the Collateral: Disney Dollars, Gift Cards, Disney Stored Value
Cards, or Theme Park Admission Passes (as such terms are defined in the License
Agreement).</FONT></TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>8.2. Extent and Duration of Security Interest.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The security
interest created and granted herein is in addition to, and supplemental of, any
security interest previously granted by any Borrower to the Agent and shall
continue in full force and effect applicable to all Liabilities until
both</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) all Liabilities
have been paid and/or satisfied in full; and<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the security
interest created herein is specifically terminated in writing by a duly
authorized officer of the Agent.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) It is intended
that the Collateral Interests created herein extend to and cover all assets of
each Borrower, other than those assets specifically excluded from the
Collateral, as set forth on <B>EXHIBIT 8.2(b)</B>, annexed hereto.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 9 Agent As Borrowers' Attorney-In-Fact:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>9.1. Appointment as Attorney-In-Fact.</B> Each Borrower hereby irrevocably
constitutes and appoints the Agent (acting through any officer of the Agent) as
that Borrowers' true and lawful attorney, with full power of substitution,
following the occurrence of an Event of Default, to convert the Collateral into
cash at the sole risk, cost, and expense of that Borrower, but for the sole
benefit of the Agent and the Revolving Credit Lenders. The rights and powers
granted the Agent by this appointment include but are not limited to the right
and power to:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) Prosecute, defend, compromise, or release any action relating to the
Collateral.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Sign change of
address forms to change the address to which each Borrowers' mail is to be sent
to such address as the Agent shall designate; receive and open each Borrowers'
mail; remove any Receivables Collateral and Proceeds of Collateral therefrom and
turn over the balance of such mail either to the Lead Borrower or to any trustee
in bankruptcy or receiver of the Lead Borrower, or other legal representative of
a Borrower whom the Agent determines to be the appropriate person to whom to so
turn over such mail.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Endorse the name
of the relevant Borrower in favor of the Agent upon any and all checks, drafts,
notes, acceptances, or other items or instruments; sign and endorse the name of
the relevant Borrower on, and receive as secured party, any of the Collateral,
any invoices, schedules of Collateral, freight or express receipts, or bills of
lading, storage receipts, warehouse receipts, or other documents of title
respectively relating to the Collateral.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Sign the name of
the relevant Borrower on any notice to that Borrowers' Account Debtors or
verification of the Receivables Collateral; sign the relevant Borrowers' name on
any Proof of Claim in Bankruptcy against Account Debtors, and on notices of
lien, claims of mechanic's liens, or assignments or releases of mechanic's liens
securing the Accounts.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Take all such
action as may be necessary to obtain the payment of any letter of credit and/or
banker's acceptance of which any Borrower is a beneficiary.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Repair,
manufacture, assemble, complete, package, deliver, alter or supply goods, if
any, necessary to fulfill in whole or in part the purchase order of any customer
of each Borrower.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Use, license or
transfer any or all General Intangibles of each Borrower.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>9.2. No Obligation to Act.</B> The Agent shall not be obligated to do any of the
acts or to exercise any of the powers authorized by Section 9.1 herein, but if
the Agent elects to do any such act or to exercise any of such powers, it shall
not be accountable for more than it actually receives as a result of such
exercise of power, and shall not be responsible to any Borrower for any act or
omission to act except for any act or omission to act as to which there is a
final determination made in a judicial proceeding (in which proceeding the Agent
has had an opportunity to be heard) which determination includes a specific
finding that the subject act or omission to act had been grossly negligent or in
actual bad faith.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 10 Events of Default:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
occurrence of any event described in this Article 10 respectively shall
constitute an &#147;<B>Event of Default</B>&#148; herein. The occurrence of any
Event of Default shall also constitute, without notice or demand, a default
under all other agreements between the Agent or any Revolving Credit Lender and
any Borrower and instruments and papers heretofore, now, or hereafter given the
Agent or any Revolving Credit Lender by any Borrower.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.1. Failure to Pay the Revolving Credit.</B> The failure by any Borrower to pay
when due any principal of, interest on, or fees in respect of, the Revolving
Credit.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.2. Failure To Make Other Payments.</B> The failure by any Borrower to pay when
due (or upon demand, if payable on demand) any payment Liability other than any
payment liability on account of the principal of, or interest on, or fees in
respect of, the Revolving Credit.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.3. Failure to Perform Covenant or Liability (No Grace Period).</B> The failure by
any Borrower to promptly, punctually, faithfully and timely perform, discharge,
or comply with any covenant or Liability included in any of the following
provisions hereof:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=20%><U>Section  Relates to</U></TD>
<TD WIDTH=75%></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=20%>4.7</TD>
<TD WIDTH=75%>Indebtedness</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=20%>4.14</TD>
<TD WIDTH=75%>Pay taxes</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=20%>4.19</TD>
<TD WIDTH=75%>Dividends. Investments. Other  Corporate Actions</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=20%>4.23</TD>
<TD WIDTH=75%>Affiliate Transactions</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=20%>Article 5</TD>
<TD WIDTH=75%>Reporting Requirements and Financial Performance Covenants</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=20%>Article 7</TD>
<TD WIDTH=75%>Cash Management</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.4. Failure to Perform Covenant or Liability (Grace Period).</B> The failure by
any Borrower, within ten (10) days following the earlier of any Borrowers'
knowledge of a breach of any covenant or Liability not described in any of
Sections 10.2, or 10.3 or of its receipt of written notice from the Agent of the
breach of any of any of such covenants or Liabilities.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.5. Misrepresentation.</B> The determination by the Agent that any representation
or warranty at any time made by any Borrower to the Agent or any Revolving
Credit Lender was not true or complete in all material respects when given.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.6. Acceleration of Other Debt. Breach of Other Agreements.</B> The occurrence of
any event such that (i) any Indebtedness of any Borrower to any creditor other
than the Agent or any Revolving Credit Lender in an amount greater than
$500,000.00 could be accelerated, (ii) without the consent of any Borrower, any
material Lease could be terminated (whether or not the subject creditor or
lessor takes any action on account of such occurrence), or (iii) the occurrence
of any event which constitutes an event of default, or any event which would,
solely with notice or the passage of time, or both, would constitute an event of
default under any documents, instruments, or agreements entered into by any
Borrower with the Walt Disney Companies, including without limitation, the
Disney License Agreement (whether or not any of the Walt Disney Companies has
taken any action on account of such occurrence).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.7. Default Under Other Agreements.</B> The occurrence of any breach of any
covenant or Liability imposed by, or of any default under, any agreement
(including any Loan Document) between the Agent or any Revolving Credit Lender
and any Borrower or instrument given by any Borrower to the Agent or any
Revolving Credit Lender and the expiry, without cure, of any applicable grace
period (notwithstanding that the subject Agent or Revolving Credit Lender may
not have exercised all or any of its rights on account of such breach or
default).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.8. Uninsured Casualty Loss.</B> The occurrence of any uninsured loss, theft,
damage, or destruction of or to any material portion of the Collateral.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.9. Attachment. Judgment. Restraint of Business.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The service of
process upon the Agent or any Revolving Credit Lender or any Participant seeking
to attach, by trustee, mesne, or other process, any funds of any Borrower on
deposit with, or assets of any Borrower in the possession of, the Agent or that
Revolving Credit or such Participant.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The entry of any
judgment against any Borrower in an amount of $500,000.00 or more, which
judgment is not satisfied (if a money judgment) or appealed from (with execution
or similar process stayed) within fifteen (15) days of its entry.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The entry of any
order or the imposition of any other process having the force of law, the effect
of which is to restrain in any material way the conduct by any Borrower of its
business in the ordinary course.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.10. Business Failure.</B> Any act by, against, or relating to any Borrower, or
its property or assets, which act constitutes the determination, by any
Borrower, to initiate a program of partial or total self-liquidation;
application for, consent to, or sufferance of the appointment of a receiver,
trustee, or other person, pursuant to court action or otherwise, over all, or
any part of any Borrower's property; the granting of any trust mortgage or
execution of an assignment for the benefit of the creditors of any Borrower, or
the occurrence of any other voluntary or involuntary liquidation or extension of
debt agreement for any Borrower; the offering by or entering into by any
Borrower of any composition, extension, or any other arrangement seeking relief
from or extension of the debts of any Borrower; or the initiation of any
judicial or non-judicial proceeding or agreement by, against, or including any
Borrower which seeks or intends to accomplish a reorganization or arrangement
with creditors; and/or the initiation by or on behalf of any Borrower of the
liquidation or winding up of all or any part of any Borrower's business or
operations.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.11. Bankruptcy.</B> The failure by any Borrower to generally pay the debts of
that Borrower as they mature; adjudication of bankruptcy or insolvency relative
to any Borrower; the entry of an order for relief or similar order with respect
to any Borrower in any proceeding pursuant to the Bankruptcy Code or any other
federal bankruptcy law; the filing of any complaint, application, or petition by
any Borrower initiating any matter in which any Borrower is or may be granted
any relief from the debts of that Borrower pursuant to the Bankruptcy Code or
any other insolvency statute or procedure; the filing of any complaint,
application, or petition against any Borrower initiating any matter in which
that Borrower is or may be granted any relief from the debts of that Borrower
pursuant to the Bankruptcy Code or any other insolvency statute or procedure,
which complaint, application, or petition is not timely contested in good faith
by that Borrower by appropriate proceedings or, if so contested, is not
dismissed within thirty (30) days of when filed.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.12. Indictment - Forfeiture.</B> The indictment of, or institution of any legal
process or proceeding against, any Borrower, under any Applicable Law where the
relief, penalties, or remedies sought or available include the forfeiture of any
property of any Borrower and/or the imposition of any stay or other order, the
effect of which could be to restrain in any material way the conduct by any
Borrower of its business in the ordinary course.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.13. Guarantor's Default</B> The occurrence of any Guarantor's Default.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.14. Termination of Guaranty.</B> The termination or attempted termination of any
guaranty by any Guarantor or Secondary Guarantor.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.15. Challenge to Loan Documents.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any challenge by
or on behalf of any Borrower to the validity of any Loan Document or the
applicability or enforceability of any Loan Document strictly in accordance with
the subject Loan Document's terms or which seeks to void, avoid, limit, or
otherwise adversely affect any security interest created by or in any Loan
Document or any payment made pursuant thereto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any
determination by any court or any other judicial or government authority that
any Loan Document is not enforceable strictly in accordance with the subject
Loan Document's terms or which voids, avoids, limits, or otherwise adversely
affects any security interest created by any Loan Document or any payment made
pursuant thereto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.16. Key Management.</B> The death or disability of, or failure to exercise that
authority and discharge those management responsibilities with respect to the
Lead Borrower as are exercised and discharged by, both Ezra Dabah and Mario
Ciampi at the execution of this Agreement if not replaced by executives approved
by the Agent in its reasonable credit judgment within Ninety (90) days after
such death or disability or the commencement of such failure.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.17. Change in Control.</B> Any Change in Control.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 11 Rights and Remedies Upon Default:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.1. Acceleration.</B> Upon the occurrence of any Event of Default as described in
Section 10.11, all Indebtedness of the Borrowers to the Revolving Credit Lenders
shall be immediately due and payable. Upon the occurrence of any Event of
Default other than as described in Section 10.11, the Agent may (and on the
issuance of Acceleration Notice(s) requisite to the causing of Acceleration, the
Agent shall) declare all Indebtedness of the Borrowers to the Revolving Credit
Lenders to be immediately due and payable and may exercise all of the Agent's
Rights and Remedies as the Agent from time to time thereafter determines as
appropriate.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.2. Rights of Enforcement.</B> Subject to and only to the extent permitted by the
terms and conditions of the Designation and in compliance with Section 16.5 of
the Disney License Agreement, the Agent shall have all of the rights and
remedies of a secured party upon default under the UCC, in addition to which the
Agent shall have all and each of the following rights and remedies:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) To
give notice to any bank at which any DDA or Blocked Account is maintained and in
which Proceeds of Collateral are deposited, to turn over such Proceeds directly
to the Agent.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) To give notice
to any customs broker of any of the Borrowers to follow the instructions of the
Agent as provided in any written agreement or undertaking of such broker in
favor of the Agent.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) To collect the
Receivables Collateral with or without the taking of possession of any of the
Collateral.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) To take
possession of all or any portion of the Collateral.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) To sell, lease,
or otherwise dispose of any or all of the Collateral, in its then condition or
following such preparation or processing as the Agent deems advisable and with
or without the taking of possession of any of the Collateral.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) To apply the
Receivables Collateral or the Proceeds of the Collateral towards (but not
necessarily in complete satisfaction of) the Liabilities.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) To exercise all
or any of the rights, remedies, powers, privileges, and discretions under all or
any of the Loan Documents.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.3. Sale of Collateral.</B> Subject to and only to the extent permitted by the
terms and conditions of the Designation and in compliance with Section 16.5 of
the Disney License Agreement,</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any sale or
other disposition of the Collateral may be at public or private sale upon such
terms and in such manner as the Agent deems advisable, having due regard to
compliance with any statute or regulation which might affect, limit, or apply to
the Agent's disposition of the Collateral.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Unless the
Collateral is perishable or threatens to decline speedily in value, or is of a
type customarily sold on a recognized market (in which event the Agent shall
provide the Lead Borrower such notice as may be practicable under the
circumstances), the Agent shall give the Lead Borrower at least ten (10) days
prior notice, by authenticated record, of the date, time, and place of any
proposed public sale, and of the date after which any private sale or other
disposition of the Collateral may be made. Each Borrower agrees that such
written notice shall satisfy all requirements for notice to that Borrower which
are imposed under the UCC or other applicable law with respect to the exercise
of the Agent's rights and remedies upon default.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent and
any Revolving Credit Lender may purchase the Collateral, or any portion of it at
any sale held under this Article.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If any of the
Collateral is sold, leased, or otherwise disposed of by the Agent on credit, the
Liabilities shall not be deemed to have been reduced as a result thereof unless
and until payment is finally received thereon by the Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Agent shall
apply the proceeds of the Agent's exercise of its rights and remedies upon
default pursuant to this Article 11</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.4. Occupation of Business Location.</B> Subject to and only to the extent
permitted by the terms and conditions of the Designation and in compliance with
Section 16.5 of the Disney License Agreement, in connection with the Agent's
exercise of the Agent's rights under this Article 11, the Agent may enter upon,
occupy, and use any premises owned or occupied by each Borrower, and may exclude
each Borrower from such premises or portion thereof as may have been so entered
upon, occupied, or used by the Agent. The Agent shall not be required to remove
any of the Collateral from any such premises upon the Agent's taking possession
thereof, and may render any Collateral unusable to the Borrowers. In no event
shall the Agent be liable to any Borrower for use or occupancy by the Agent of
any premises pursuant to this Article 11, nor for any charge (such as wages for
any Borrowers' employees and utilities) incurred in connection with the Agent's
exercise of the Agent's Rights and Remedies.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.5. Grant of Nonexclusive License.</B> Each Borrower hereby grants to the Agent a
royalty free nonexclusive irrevocable license to use, apply, and affix any
trademark, trade name, logo, or the like in which any Borrower now or hereafter
has rights (but excluding any such rights under the Disney License Agreement),
such license being with respect to the Agent's exercise of the rights hereunder
including, without limitation, in connection with any completion of the
manufacture of Inventory or sale or other disposition of Inventory.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.6. Assembly of Collateral.</B> Subject to and only to the extent permitted by the
terms and conditions of the Designation and in compliance with Section 16.5 of
the Disney License Agreement,, the Agent may require any Borrower to assemble
the Collateral and make it available to the Agent at the Borrowers' sole risk
and expense at a place or places which are reasonably convenient to both the
Agent and the Lead Borrower.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.7. Rights and Remedies.</B> The rights, remedies, powers, privileges, and
discretions of the Agent hereunder (herein, the "<B>Agent's Rights and Remedies</B>")
shall be cumulative and not exclusive of any rights or remedies which it would
otherwise have. No delay or omission by the Agent in exercising or enforcing any
of the Agent's Rights and Remedies shall operate as, or constitute, a waiver
thereof. No waiver by the Agent of any Event of Default or of any default under
any other agreement shall operate as a waiver of any other default hereunder or
under any other agreement. No single or partial exercise of any of the Agent's
Rights or Remedies, and no express or implied agreement or transaction of
whatever nature entered into between the Agent and any person, at any time,
shall preclude the other or further exercise of the Agent's Rights and Remedies.
No waiver by the Agent of any of the Agent's Rights and Remedies on any one
occasion shall be deemed a waiver on any subsequent occasion, nor shall it be
deemed a continuing waiver. Subject to and only to the extent permitted by the
terms and conditions of the Designation and in compliance with Section 16.5 of
the Disney License Agreement. the Agent's Rights and Remedies may be exercised
at such time or times and in such order of preference as the Agent may
determine. The Agent's Rights and Remedies may be exercised without resort or
regard to any other source of satisfaction of the Liabilities.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 12 Cure and Reinstatement Rights</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
anything to the contrary contained in Article 10, or Article 11, or Article 14,
the Agent&#146;s Rights and Remedies shall be subject to the following terms and
conditions, and subject to and only to the extent permitted by the terms and
conditions of the Designation and in compliance with Section 16.5 of the Disney
License Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>12.1. Financially Curable Defaults.</B> The following Defaults or Events of Default
shall constitute "<B>Financially Curable Defaults</B>" (so referred to herein): (i)
payment defaults, whether with respect to the Liabilities, or otherwise; (ii)
breach of Financial Performance Covenants, and (iii) breach of Availability and
Borrowing Base requirements.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Upon any
Borrower becoming In Default or upon the occurrence of any Event of Default with
respect to Financially Curable Defaults, the Agent shall provide written notice
thereof to the Borrowers and to the Walt Disney Companies. The notice shall set
forth the actions necessary to be taken, and the amount of cash required to be
paid to the Agent by either the Borrowers and/or a third party on their behalf
to so implement the cure required by the Agent. The Borrowers acknowledge that
any such cure may be further conditioned upon the Borrowers and/or such third
party reimbursing the Agent for all costs and expenses incurred incidental to
the Default or Event of Default and the implementation of the cure, including
attorneys fees and expenses, as well as the assessment by the Lender and the
payment by the Borrowers and/or such third party of an appropriate waiver fee in
an amount to be determined by the Agent, in the Agent's sole and exclusive
discretion.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any such cure
shall be implemented to the satisfaction of the Agent, in its reasonable
discretion, and the required amounts paid to the Agent, within Five (5) Business
Days of delivery of the notice from the Agent. If the Borrowers and/or such
third party do in fact implement the steps and make the payment required by the
Agent, then the Agent shall deliver written confirmation thereof, whereupon the
Default or Event of Default shall be deemed cured and the Revolving Credit shall
be reinstated.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>12.2. Non-Curable Defaults.</B> The Borrowers acknowledge and agree that the
following Defaults and Events of Default constitute "<B>Non-Curable Defaults</B> (so
referred to herein)," cannot be cured, and that they have no right to cure or
attempt to cure any Default or Event of Default related to the events described
in any of Sections 10.5 (Misrepresentation), 10.10 (Business Failure), 10.11
(Bankruptcy), 10.12 (Indictment - Forfeiture), or 10.15 (Challenge to Loan
Documents). Upon the occurrence of any Default or Event of Default with respect
to Non-Curable Defaults, the Agent may commence enforcing the Agent's Rights and
Remedies in accordance with Article 11.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>12.3. Other Defaults.</B> To the extent that a Default or Event of Default occurs
for a reason other than those specified in Section 12.1 or Section 12.2
(collectively, "<B>Other Defaults</B>"), and the circumstance(s) giving rise to any
Other Defaults is(are) susceptible of being cured, as determined by the Agent in
its sole and exclusive discretion, the Agent may, in its sole and exclusive
discretion, afford the Borrowers and any third party acting on the Borrowers'
behalf the opportunity of attempting to cure any such Other Default.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In such
circumstance, the Agent shall provide written notice thereof to the Borrowers
and to the Walt Disney Companies. The notice shall set forth the actions
necessary to be taken, and/or the amount of cash required to be paid to the
Agent by either the Borrowers and/or such third party to so implement the cure
required by the Agent. The Borrowers acknowledge that any such cure may be
further conditioned upon the Borrowers and/or such third party reimbursing the
Agent for all costs and expenses incurred incidental to the Default or Event of
Default and the implementation of the cure, including attorneys fees and
expenses, as well as the assessment by the Lender and the payment by the
Borrowers and/or such third party of an appropriate waiver fee in an amount to
be determined by the Agent, in the Agent's sole and exclusive
discretion.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any such cure
shall be implemented to the satisfaction of the Agent, in its reasonable
discretion, and the required amounts paid to the Agent, within Five (5) Business
Days of delivery of the notice from the Agent. If the Borrowers and/or such
third party do in fact implement the steps and make the payment required by the
Agent, then the Agent shall deliver written confirmation thereof, whereupon the
Default or Event of Default shall be deemed cured and the Revolving Credit shall
be reinstated.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>12.4. Pending Cure; Failure to Cure.</B> The Borrowers acknowledge and agree that
pending the potential cure by the Borrowers or any third party of any
Financially Curable Default or Other Default, the Agent and the Revolving Credit
Lenders shall have no obligation to make any additional Revolving Credit Loans
or extend financial accommodations to or for the benefit of any Borrower. In the
event that the Walt Disney Companies or any third party that is acceptable to
the Agent in its reasonable credit judgment desires to assist with any potential
cure, the Agent and the Borrowers each agree and commit to work diligently and
in good faith to address the Default or Event of Default and endeavor to reach a
mutually acceptable resolution thereof. Such a resolution could include, as
examples and without limitation:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
A waiver of any Default or Event of Default by the Agent and the
Lenders;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)
A curing of the Default or Event of Default by the Borrowers, or a third party
on the Borrowers' behalf;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)
An amendment to the provision of the Loan Documents which have been breached so
as to resolve the Default or Event of Default;</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)
An infusion of cash or other equity injection on the Borrowers' behalf;
and</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)
Any and all other similar and reasonable methods of addressing and resolving the
Default or Event of Default.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
In the event that either (i) the good faith negotiations are discontinued, or
(ii) the Agent and the Borrowers and any third party involved in such
negotiations are unable to reach a mutually acceptable resolution of the Default
or Event of Default within Thirty (30) days after the date of the predicating
Default, or such longer time as the parties may agree, the Agent may thereupon
commence enforcing the Agent's Rights and Remedies as provided in Article 11
without further notice to the Borrowers or any such third party.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>12.5. Limitation on Cure Rights.</B> The Borrowers further acknowledge and agree
that although they may cure successive Financially Curable Defaults and Other
Defaults, they shall have no right to cure (i) any Other Defaults which the
Agent has determined is not susceptible of being cured and as to which the Agent
has not delivered a notice of default specifying the actions and/or payments
required to be made in order to cure the subject Other Default, (ii) more than
Three (3) Defaults or Events of Default in the aggregate, and (iii) any Default
or Event of Default which occurs within Sixty (60) days after the occurrence of
any Default or Event of Default which had been cured as provided herein.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 13 Revolving Credit Fundings and Distributions:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>13.1. Revolving Credit Funding Procedures.</B> Subject to Section 13.2:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
The Agent shall advise each Revolving Credit Lender, no later than 2:00PM on a
date on which any Revolving Credit Loan is to be made on that date. Such advice,
in each instance, may be by telephone or facsimile transmission, provided that
if such advice is by telephone, it shall be confirmed in writing. Advice of a
Revolving Credit Loan shall include the amount of and interest rate applicable
to the subject Revolving Credit Loan.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subject to that
Revolving Credit Lender's Revolving Credit Dollar Commitment, each Revolving
Credit Lender, by no later than the end of business on the day on which the
subject Revolving Credit Loan is to be made, shall Transfer that Revolving
Credit Lender's Revolving Credit Percentage Commitment of the subject Revolving
Credit Loan to the Agent.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>13.2. Agent's Covering of Fundings:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Revolving
Credit Lender shall make available to the Agent, as provided herein, that
Revolving Credit Lender's Revolving Credit Percentage Commitment of the
following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Each Revolving
Credit Loan, up to the maximum amount of that Revolving Credit Lender's
Revolving Credit Dollar Commitment of the Revolving Credit Loans.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Up to the
maximum amount of that Revolving Credit Lender's Revolving Credit Dollar
Commitment of each L/C Drawing (to the extent that such L/C Drawing is not
"covered" by a Revolving Credit Loan as provided herein).</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In all circumstances, the Agent may:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Assume that each
Revolving Credit Lender, subject to Section 13.3(a), timely shall make available
to the Agent that Revolving Credit Lender's Revolving Credit Percentage
Commitment of each Revolving Credit Loan, notice of which is provided pursuant
to Section 12.1 and shall make available, to the extent not "covered" by a
Revolving Credit Loan, that Revolving Credit Lender's Revolving Credit
Percentage Commitment of any honoring of an L/C.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) In reliance
upon such assumption, make available the corresponding amount to the Borrowers.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Assume that
each Revolving Credit Lender timely shall pay, and shall make available, to the
Agent all other amounts which that Revolving Credit Lender is obligated to so
pay and/or make available hereunder or under any of the Loan Documents.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the event
that, in reliance upon any of such assumptions, the Agent makes available, a
Revolving Credit Lender's Revolving Credit Percentage Commitment of one or more
Revolving Credit Loans, or any other amount to be made available hereunder or
under any of the Loan Documents, which amount a Revolving Credit Lender (a
"<B>Delinquent Revolving Credit Lender</B>") fails to provide to the Agent within One
(1) Business Day of written notice of such failure, then:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The amount which
had been made available by the Agent is an "<B>Agent's Cover</B>" (and is so referred
to herein).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) All interest
paid by the Borrowers on account of the Revolving Credit Loan or coverage of the
subject L/C Drawing which consist of the Agent's Cover shall be retained by the
Agent until the Agent's Cover, with interest, has been paid.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Delinquent
Revolving Credit Lender shall pay to the Agent, on demand, interest at a rate
equal to the prevailing federal funds rate on any Agent's Cover in respect of
that Delinquent Revolving Credit Lender<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The Agent shall
have succeeded to all rights to payment to which the Delinquent Revolving Credit
Lender otherwise would have been entitled hereunder in respect of those amounts
paid by or in respect of the Borrowers on account of the Agent's Cover together
with interest until it is repaid. Such payments shall be deemed made first
towards the amounts in respect of which the Agent's Cover was provided and only
then towards amounts in which the Delinquent Revolving Credit Lender is then
participating. For purposes of distributions to be made pursuant to Section
13.3(a) (which relates to ordinary course distributions) or Section 14.6 (which
relates to distributions of proceeds of a Liquidation) below, amounts shall be
deemed distributable to a Delinquent Revolving Credit Lender (and consequently,
to the Agent to the extent to which the Agent is then entitled) at the highest
level of distribution (if applicable) at which the Delinquent Revolving Credit
Lender would otherwise have been entitled to a distribution.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Subject to
Subsection 13.2(c)(iv), the Delinquent Revolving Credit Lender shall be entitled
to receive any payments from the Borrowers to which the Delinquent Revolving
Credit Lender is then entitled, provided however there shall be deducted from
such amount and retained by the Agent any interest to which the Agent is then
entitled on account of Section 13.2(c)(ii), above.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) A Delinquent
Revolving Credit Lender shall not be relieved of any obligation of such
Delinquent Revolving Credit Lender hereunder (all and each of which shall
constitute continuing obligations on the part of any Delinquent Revolving Credit
Lender).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) A Delinquent
Revolving Credit Lender may cure its status as a Delinquent Revolving Credit
Lender by paying the Agent the aggregate of the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Agent's
Cover (to the extent not previously repaid by the Borrowers and retained by the
Agent in accordance with Subsection 13.2(c)(iv)), above) with respect to that
Delinquent Revolving Credit Lender.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Plus<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The aggregate
of the amount payable under Subsection 13.2(c)(iii), above (which relates to
interest to be paid by that Delinquent Revolving Credit Lender).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Plus<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) All such costs
and expenses as may be incurred by the Agent in the enforcement of the Agent's
rights against such Delinquent Revolving Credit Lender.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>13.3. Ordinary Course Distributions.</B> (This Section 13.3 applies unless the
provisions of Section 14.6 (which relates to distributions in the event of a
Liquidation) becomes operative).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On such day as
may be set from time to time by the Agent (or more frequently at the Agent's
option) the Agent and each Revolving Credit Lender shall settle up on amounts
advanced under the Revolving Credit and collected funds received in the Blocked
Account.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent shall
distribute to each Revolving Credit Lender, such Person's respective pro-rata
share of principal, fees, and interest payments on the Revolving Credit Loans
when actually received and collected by the Agent (excluding the One (1)
Business Days for settlement provided for in Section 7.3(a), which shall be for
the account of the Agent only). For purposes of calculating interest due to a
Revolving Credit Lender, that Revolving Credit Lender shall be entitled to
receive interest on the actual amount contributed by that Revolving Credit
Lender towards the principal balance of the Revolving Credit Loans outstanding
during the applicable period covered by the interest payment made by the
Borrowers. Any net principal reductions to the Revolving Credit Loans received
by the Agent in accordance with the Loan Documents during such period shall not
reduce such actual amount so contributed, for purposes of calculation of
interest due to that Revolving Credit Lender, until the Agent has distributed to
that Revolving Credit Lender its pro-rata share thereof.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Revolving
Credit Lender shall have any interest in, or right to receive any part of any
interest which reflects "float" as described in the proviso included in
Section7.3(a). Any such float shall be for the account of the Agent
only.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) No Revolving
Credit Lender shall have any interest in, or right to receive any part of, the
Agent's Fee to be paid by the Borrowers to the Agent pursuant to this
Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Any amount
received by the Agent as reimbursement for any cost or expense (including
without limitation, attorneys' reasonable fees) shall be distributed by the
Agent to that Person which is entitled to such reimbursement as provided in this
Agreement (and if such Person(s) is (are) the Revolving Credit Lenders, pro-rata
based upon their respective Revolving Credit Commitment Percentages at the date
on which the expense, in respect of which such reimbursement is being made, was
incurred).</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Each
distribution pursuant to this Section 13.3 is subject to Section 13.2(c),
above.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 14 Acceleration and Liquidation:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Subject to and only to the extent permitted by the terms and conditions of the
Designation and in compliance with Section 16.5 of the Disney License Agreement:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14.1. Acceleration Notices</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Agent may
give the Revolving Credit Lenders an Acceleration Notice at any time following
the occurrence of an Event of Default.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The
SuperMajority Lenders may give the Agent an Acceleration Notice at any time
following the occurrence of an Event of Default. Such notice may be by multiple
counterparts, provided that counterparts executed by the requisite Revolving
Credit Lenders are received by the Agent within a period of five (5) consecutive
Business Days.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14.2. Acceleration.</B> Unless stayed by judicial or statutory process, the Agent
shall Accelerate the Liabilities on account of the Revolving Credit within a
commercially reasonable time following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) The Agent's giving of an Acceleration Notice to the Revolving Credit Lenders
as provided in Section 14.1(a).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent's
receipt of an Acceleration Notice from the SuperMajority Lenders, in compliance
with Section 14.1(b).</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14.3. Initiation of Liquidation</B> Unless stayed by judicial or statutory process,
a Liquidation shall be initiated by the Agent within a commercially reasonable
time following Acceleration of Liabilities on account of the Revolving Credit.
The Agent shall provide written notice of the initiation of any Liquidation to
the Walt Disney Companies.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14.4. Actions At and Following Initiation of Liquidation</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) At the
initiation of a Liquidation the Agent and the Revolving Credit Lenders shall
"net out" each Revolving Credit Lender's respective contributions towards the
Revolving Credit Loans, so that each Revolving Credit Lender holds that
Revolving Credit Lender's Revolving Credit Percentage Commitment of the
Revolving Credit Loans and advances.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Following the
initiation of a Liquidation, each Revolving Credit Lender shall contribute,
towards any L/C thereafter honored and not immediately reimbursed by the
Borrowers, that Revolving Credit Lender's Revolving Credit Percentage Commitment
of such honoring.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14.5. Agent's Conduct of Liquidation</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any Liquidation
shall be conducted by the Agent, with the advice and assistance of the Revolving
Credit Lenders.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent may
establish one or more Nominees to "bid in" or otherwise acquire ownership to any
Post Foreclosure Asset.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent shall
manage the Nominee and manage and dispose of any Post Foreclosure Assets with a
view towards the realization of the economic benefits of the ownership of the
Post Foreclosure Assets and in such regard, the Agent and/or the Nominee may
operate, repair, manage, maintain, develop, and dispose of any Post Foreclosure
Asset in such manner as the Agent determines as appropriate under the
circumstances.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Agent may
decline to undertake or to continue taking a course of action or to execute an
action plan (whether proposed by the Agent or any Revolving Credit Lender)
unless indemnified to the Agent's satisfaction by the Revolving Credit Lenders
against any and all liability and expense which may be incurred by the Agent by
reason of taking or continuing to take that course of action or action
plan.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Each Revolving
Credit Lender shall execute all such instruments and documents not inconsistent
with the provisions of this Agreement as the Agent and/or the Nominee reasonably
may request with respect to the creation and governance of any Nominee, the
conduct of the Liquidation, and the management and disposition of any Post
Foreclosure Asset.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Agent shall
provide written notice of the material courses of action undertaken in a
Liquidation to the Walt Disney Companies.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14.6. Distribution of Liquidation Proceeds:</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Agent may
establish one or more reasonably funded reserve accounts into which proceeds of
the conduct of any Liquidation may be deposited in anticipation of future
expenses which may be incurred by the Agent in the exercise of rights as a
secured creditor of the Borrowers and prior claims which the Agent anticipates
may need to be paid.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent shall
distribute the net proceeds of Liquidation in accordance with the relative
priorities set forth in Section 14.7.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Revolving
Credit Lender, on the written request of the Agent and/or any Nominee, not more
frequently than once each month, shall reimburse the Agent and/or any Nominee,
Pro-Rata, for any cost or expense reasonably incurred by the Agent and/or the
Nominee in the conduct of a Liquidation, which amount is not covered out of
current proceeds of the Liquidation, which reimbursement shall be paid over to
and distributed by the Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14.7. Relative Priorities To Proceeds of Liquidation</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All
distributions of proceeds of a Liquidation shall be net of payment over to the
Agent as reimbursement for all reasonable third party costs and expenses
incurred by the Agent and to Lenders' Special Counsel and to any funded reserve
established pursuant to Section 14.6(a).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The proceeds of
a Liquidation, net of those amounts described in Section 13.2(c)(iv), shall be
distributed based on the following priorities:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) To the Revolving
Credit Lenders (other than any Delinquent Revolving Credit Lender), pro-rata, to
those fees distributable hereunder to the Revolving Credit Lenders; and then<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) To the
Revolving Credit Lenders (other than any Delinquent Revolving Credit Lender),
pro-rata, to accrued interest on the Revolving Credit; and then<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) To the
Revolving Credit Lenders (other than any Delinquent Revolving Credit Lender),
pro-rata, to the unpaid principal balance of the Revolving Credit (including
amounts necessary to cover any undrawn L/C's); and then<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) To any
Delinquent Revolving Credit Lenders, pro-rata to amounts to which such Revolving
Credit Lenders otherwise would have been entitled pursuant to Sections
14.7(b)(i), 14.7(b)(ii), 14.7(b)(iii); and then<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) To the Revolving
Credit Lenders, pro-rata, to the extent of the Revolving Credit Early
Termination Fee; and then<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) To any other
Liabilities.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 15 The Agent:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.1. Appointment of The Agent</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Lender
appoints and designates Wells Fargo Retail Finance, LLC as the "Agent" hereunder
and under the Loan Documents.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Revolving
Credit Lender authorizes the Agent:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) To execute those
of the Loan Documents and all other instruments relating thereto to which the
Agent is a party.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) To take such
action on behalf of the Revolving Credit Lenders and to exercise all such powers
as are expressly delegated to the Agent hereunder and in the Loan Documents and
all related documents, together with such other powers as are reasonably
incident thereto.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.2. Responsibilities of Agent</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Agent shall
not have any duties or responsibilities to, or any fiduciary relationship with,
any Revolving Credit Lender except for those expressly set forth in this
Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Neither the
Agent nor any of its Affiliates shall be responsible to any Revolving Credit
Lender for any of the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any recitals,
statements, representations or warranties made by any Borrower or any other
Person.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Any appraisals
or other assessments of the assets of any Borrower or of any other Person
responsible for or on account of the Liabilities.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The value,
validity, effectiveness, genuineness, enforceability, or sufficiency of the Loan
Agreement, the Loan Documents or any other document referred to or provided for
therein.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any failure by
any Borrower or any other Person (other than the Agent) to perform its
obligations under the Loan Documents.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent may
employ attorneys, accountants, and other professionals and agents and
attorneys-in-fact and shall not be responsible for the negligence or misconduct
of any such attorneys, accountants, and other professionals or agents or
attorneys-in-fact selected by the Agent with reasonable care. No such attorney,
accountant, other professional, agent, or attorney-in-fact shall be responsible
for any action taken or omitted to be taken by any other such Person.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Neither the
Agent, nor any of its directors, officers, or employees shall be responsible for
any action taken or omitted to be taken or omitted to be taken by any other of
them in connection herewith in reliance upon advice of its counsel nor, in any
other event except for any action taken or omitted to be taken as to which a
final judicial determination has been or is made (in a proceeding in which such
Person has had an opportunity to be heard) that such Person had acted in a
grossly negligent manner, in actual bad faith, or in willful
misconduct.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Agent shall
not have any responsibility in any event for more funds than the Agent actually
receives and collects.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Agent, in
its separate capacity as a Lender, shall have the same rights and powers
hereunder as any other Lender.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.3. Concerning Distributions By the Agent</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Agent in the
Agent's reasonable discretion based upon the Agent's determination of the
likelihood that additional payments will be received, expenses incurred, and/or
claims made by third parties to all or a portion of such proceeds, may delay the
distribution of any payment received on account of the Liabilities.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent may
disburse funds prior to determining that the sums which the Agent expects to
receive have been finally and unconditionally paid to the Agent. If and to the
extent that the Agent does disburse funds and it later becomes apparent that the
Agent did not then receive a payment in an amount equal to the sum paid out,
then any Revolving Credit Lender to whom the Agent made the funds available, on
demand from the Agent, shall refund to the Agent the sum paid to that
person.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If, in the
opinion of the Agent, the distribution of any amount received by the Agent might
involve the Agent in liability, or might be prohibited hereby, or might be
questioned by any Person, then the Agent may refrain from making distribution
until the Agent's right to make distribution has been adjudicated by a court of
competent jurisdiction.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The proceeds of
any Revolving Credit Lender's exercise of any right of, or in the nature of,
set-off shall be deemed, First, to the extent that a Revolving Credit Lender is
entitled to any distribution hereunder, to constitute such distribution and
Second, shall be shared with the other Revolving Credit Lenders as if
distributed pursuant to (and shall be deemed as distributions under) Section
14.7.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Each Revolving
Credit Lender recognizes that the crediting of the Borrowers with the "proceeds"
of any transaction in which a Post Foreclosure Asset is acquired is a non-cash
transaction and that, in consequence, no distribution of such "proceeds" will be
made by the Agent to any Lender.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) In the event
that (x) a court of competent jurisdiction shall adjudge that any amount
received and distributed by the Agent is to be repaid or disgorged or (y) those
Lenders adversely affected thereby determine to effect such repayment or
disgorgement, then each Revolving Credit Lender to which any such distribution
shall have been made shall repay, to the Agent which had made such distribution,
that Revolving Credit Lender's Pro-Rata share of the amount so adjudged or
determined to be repaid or disgorged.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.4. Dispute Resolution:</B> Any dispute among the Revolving Credit Lenders and/or
the Agent concerning the interpretation, administration, or enforcement of the
financing arrangements contemplated by this or any other Loan Document or the
interpretation or administration of this or any other Loan Document which cannot
be resolved amicably shall be resolved in the United States District Court for
the District of Massachusetts, sitting in Boston or in the Superior Court of
Suffolk County, Massachusetts, to the jurisdiction of which courts each
Revolving Credit Lender hereto hereby submits.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.5. Distributions of Notices and Other Documents</B> The Agent will forward to
each Revolving Credit Lender, promptly after the Agent's receipt thereof, a copy
of each notice or other document furnished to the Agent pursuant to this
Agreement, including monthly, quarterly, and annual financial statements
received from the Lead Borrower pursuant to Article 4.28 of this Agreement,
other than any of the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
Routine communications associated with requests for Revolving Credit Loans
and/or the issuance of L/C's.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Routine or nonmaterial communications.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any notice or
document required by any of the Loan Documents to be furnished to the Revolving
Credit Lenders by the Lead Borrower.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Any notice or
document of which the Agent has knowledge that such notice or document had been
forwarded to the Revolving Credit Lenders other than by the Agent.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.6. Confidential Information</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Revolving
Credit Lender and any Participant will maintain, as confidential, all of the
following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Proprietary
approaches, techniques, and methods of analysis which are applied by the Agent
in the administration of the credit facility contemplated by this Agreement.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Proprietary
forms and formats utilized by the Agent in providing reports to the Revolving
Credit Lenders pursuant hereto, which forms or formats are not of general
currency.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The results of
financial examinations, reviews, inventories, analysis, appraisals, and other
information concerning, relating to, or in respect of any Borrower and prepared
by or at the request of, or furnished to any of, the Revolving Credit Lenders by
or on behalf of the Agent.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) None of the
Agent or the Revolving Credit Lenders shall in any manner whatsoever, directly
or indirectly, disclose any confidential information (including without
limitation any of the Licensed Materials, as defined in the Disney License
Agreement) of the Disney Companies to any Person.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Nothing included
herein shall prohibit the disclosure of any such information as may be required
to be provided by judicial process or by regulatory authorities having
jurisdiction over any party to this Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.7. Reliance by Agent</B> The Agent shall be entitled to rely upon any
certificate, notice or other document (including any cable, telegram, telex, or
facsimile) reasonably believed by the Agent to be genuine and correct and to
have been signed or sent by or on behalf of the proper person or persons, and
upon advice and statements of attorneys, accountants and other experts selected
by the Agent. As to any matters not expressly provided for in this Agreement,
any Loan Document, or in any other document referred to therein, the Agent shall
in all events be fully protected in acting, or in refraining from acting, in
accordance with the applicable Consent required by this Agreement. Instructions
given with the requisite Consent shall be binding on all Revolving Credit
Lenders.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.8. Non-Reliance on Agent and Other Revolving Credit Lenders</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Revolving
Credit Lender represents to all other Revolving Credit Lenders and to the Agent
that such Revolving Credit Lender:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Independently
and without reliance on any representation or act by Agent or by any other
Revolving Credit Lender, and based on such documents and information as that
Revolving Credit Lender has deemed appropriate, has made such Revolving Credit
Lender's own appraisal of the financial condition and affairs of the Borrowers
and decision to enter into this Agreement.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Has relied upon
that Revolving Credit Lender's review of the Loan Documents by that Revolving
Credit Lender and by counsel to that Revolving Credit Lender as that Revolving
Credit Lender deemed appropriate under the circumstances.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Revolving
Credit Lender agrees that such Revolving Credit Lender, independently and
without reliance upon Agent or any other Revolving Credit Lender, and based upon
such documents and information as such Revolving Credit Lender shall deem
appropriate at the time, will continue to make such Revolving Credit Lender's
own appraisals of the financial condition and affairs of the Borrowers when
determining whether to take or not to take any discretionary action under this
Agreement.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent, in
the discharge of that Agent's duties hereunder, shall not</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Be required to
make inquiry of, or to inspect the properties or books of, any Person.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Have any
responsibility for the accuracy or completeness of any financial examination,
review, inventory, analysis, appraisal, and other information concerning,
relating to, or in respect of any Borrower and prepared by or at the request of,
or furnished to any of, the Revolving Credit Lenders by or on behalf of the
Agent.</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Except for
notices, reports, and other documents and information expressly required to be
furnished to the Revolving Credit Lenders by the Agent hereunder (as to which,
see Section 15.5), the Agent shall not have any affirmative duty or
responsibility to provide any Lender with any credit or other information
concerning any Person, which information may come into the possession of Agent
or any Affiliate of the Agent.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Each Revolving
Credit Lender, at such Revolving Credit Lender's request, shall have reasonable
access to all nonprivileged documents in the possession of the Agent, which
documents relate to the Agent's performance of its duties hereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.9. Indemnification</B> Without limiting the liabilities of the Borrowers under
any this or any of the other Loan Documents, each Revolving Credit Lender shall
indemnify the Agent, Pro-Rata, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (including attorneys' reasonable fees and
expenses and other out-of-pocket expenditures) which may at any time be imposed
on, incurred by, or asserted against the Agent and in any way relating to or
arising out of this Agreement or any other Loan Document or any documents
contemplated by or referred to therein or the transactions contemplated thereby
or the enforcement of any of terms hereof or thereof or of any such other
documents, provided, however, no Revolving Credit Lender shall be liable for any
of the foregoing to the extent that any of the foregoing arises from any action
taken or omitted to be taken by the Agent as to which a final judicial
determination has been or is made (in a proceeding in which the Agent has had an
opportunity to be heard) that the Agent had acted in a grossly negligent manner,
in actual bad faith, or in willful misconduct.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>15.10. Resignation of Agent</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Agent may
resign at any time by giving 60 days prior written notice thereof to the
Revolving Credit Lenders. Upon receipt of any such notice of resignation, the
SuperMajority Lenders shall have the right to appoint a successor to such Agent
(and if no Event of Default has occurred, with the consent of the Lead Borrower,
not to be unreasonably withheld and, in any event, deemed given by the Lead
Borrower if no written objection is provided by the Lead Borrower to the
(resigning) Agent within seven (7) Business Days notice of such proposed
appointment). If a successor Agent shall not have been so appointed and accepted
such appointment within 30 days after the giving of notice by the resigning
Agent, then the resigning Agent may appoint a successor Agent, which shall be a
financial institution having a combined capital and surplus in excess of $100
Million. The consent of the Lead Borrower otherwise required by this Section
15.10(a) shall not be required if an Event of Default has occurred.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor shall thereupon succeed to, and become vested with, all the rights,
powers, privileges, and duties of the (resigning) Agent so replaced, and the
(resigning) Agent shall be discharged from the (resigning) Agent's duties and
obligations hereunder, other than on account of any responsibility for any
action taken or omitted to be taken by the (resigning) Agent as to which a final
judicial determination has been or is made (in a proceeding in which the
(resigning) Person has had an opportunity to be heard) that such Person had
acted in a grossly negligent manner or in bad faith.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) After any
retiring Agent's resignation, the provisions of this Agreement and of all other
Loan Documents shall continue in effect for the retiring Person's benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>15.11. Documentation Agent; Co-Agent.</B> Notwithstanding the provisions of this
Agreement or any of the other Loan Documents, Congress Financial Corporation
(New England) (in its capacity as Documentation Agent, as opposed to its
capacity as a Revolving Credit Lender), and LaSalle Retail Finance, a division
of LaSalle Business Credit LLC (in its capacity as Co-Agent, as opposed to its
capacity as a Revolving Credit Lender) shall have no powers, rights, duties,
responsibilities, or liabilities with respect to this Agreement and the other
Loan Documents, nor shall Congress Financial Corporation (New England) or
LaSalle Retail Finance, a division of LaSalle Business Credit LLC, have or be
deemed to have any fiduciary relationship with any Lender.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 16 Action By Agents - Consents - Amendments - Waivers:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.1. Administration of Credit Facilities</B></FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as
otherwise specifically provided in this Agreement, the Agent may take any action
with respect to the credit facility contemplated by the Loan Documents as the
Agent determines to be appropriate , provided, however, the Agent is not under
any affirmative obligation to take any action which it is not required by this
Agreement or the Loan Documents specifically to so take.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as
specifically provided in the following Sections of this Agreement, whenever a
Loan Document or this Agreement provides that action may be taken or omitted to
be taken in an Agent's discretion, the Agent shall have the sole right to take,
or refrain from taking, such action without, and notwithstanding, any vote of
the Revolving Credit Lender:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=45%><U>Actions Described in Section</U><BR>
<BR>
16.2<BR>
<BR>
16.3<BR>
<BR>
16.4<BR>
<BR>
16.5<BR>
<BR>
16.6</TD>
<TD WIDTH=45%><U>Type of Consent Required</U><BR>
<BR>
Majority Lenders<BR>
<BR>
SuperMajority Lenders<BR>
<BR>
Certain Consent<BR>
<BR>
Unanimous Consent<BR>
<BR>
Consent of the Agent</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The rights
granted to the Revolving Credit Lenders in those sections referenced in Section
16.1(b) shall not otherwise limit or impair the Agent's exercise of its
discretion under the Loan Documents.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.2. Actions Requiring or On Direction of Majority Lenders</B> Except as otherwise
provided in this Agreement, the Consent or direction of the Majority Lenders is
required for any amendment, waiver, or modification of any Loan Document.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.3. Actions Requiring or On Direction of SuperMajority Lenders</B> The Consent or
direction of the SuperMajority Lenders is required as follows:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
The SuperMajority Lenders may direct the Agent to require the prompt repayment
of Protective OverAdvances that have been outstanding for more than Sixty (60)
consecutive Business Days (the Revolving Credit Lenders recognizing that, except
as described in this Section 16.3(a), any loan or advance under the Revolving
Credit which results in a Protective OverAdvance may be made by the Agent in its
discretion without the Consent of the Revolving Credit Lenders and that each
Revolving Credit Lender shall be bound thereby.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The
SuperMajority Lenders may direct the Agent to suspend the Revolving Credit
(including the making of any Protective OverAdvances), if any Borrower is then
In Default, following which direction, and for as long as a Borrower is In
Default, the only Revolving Credit Loans which may be made are the
following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Protective
OverAdvances not otherwise terminated as provided in 16.3(a).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Revolving
Credit Loans made to "cover" the honoring of L/C's.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Revolving
Credit Loans made with Consent of the SuperMajority Lenders.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
The SuperMajority Lenders may undertake the following if an Event of Default has
occurred and not been duly waived, :</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Give the Agent
an Acceleration Notice in accordance with Section 14.1(b).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Direct the
Agent to increase the rate of interest to the default rate of interest as
provided in, and to the extent permitted by, this Agreement.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.4. Action Requiring Certain Consent</B> The Consent or direction of the following
is required for the following actions:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
Any forgiveness of all or any portion of any payment Liability: All Lenders
whose payment Liability is being so forgiven: (other than any Delinquent
Revolving Credit Lender).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any decrease in
any interest rate or fee payable under any of the Loan Documents (other than any
fee payable to the Agent (for which the consent of the Agent shall be required):
Any Lenders adversely affected thereby (other than any Delinquent Revolving
Credit Lender).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any waiver,
amendment, or modification which has the effect of increasing any Revolving
Credit Dollar Commitment or Revolving Credit Percentage Commitment shall be
subject to the Consent of all Revolving Credit Lenders (other than any
Delinquent Revolving Credit Lender) except that no Consent shall be required for
any such increase which is the result of the application of the following
Sections of this Agreement:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Section 16.9
(which relates to NonConsenting Revolving Credit Lenders).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Section 17.1
(which relates to assignments and assumptions).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
Volitional Disgorgement as described in 15.3(f): Each Lender (other than any
Delinquent Revolving Credit Lender) which is adversely affected thereby.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.5. Actions Requiring or Directed By Unanimous Consent</B> None of the following
may take place except with Unanimous Consent:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
Any release of a material portion of the Collateral, but such Consent to such
release is not required if any of the following conditions is satisfied:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Such release is
otherwise required or provided for in the Loan Documents.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Such release is
being made to facilitate a Liquidation.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) No OverLoan
exists immediately after giving effect to the application to the Loan Account of
the net proceeds received on account of the transaction in which such release is
made.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any affirmative
subordination of the Liabilities to any material obligation of any Borrower,
unless such subordination is otherwise required pursuant to, or is permitted by
this Agreement.</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
Any amendment of the Definitions of "Borrowing Base" or "Availability" or of any
Definition of any component thereof, such that more credit would be available to
the Borrowers, based on the same assets, as would have been available to the
Borrowers immediately prior to such amendment , it being understood, however,
that:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
The foregoing shall not limit the adjustment by the Agent of any reserve in the
Agent's administration of the Revolving Credit as otherwise permitted by this
Agreement.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The foregoing shall
not prevent the Agent, in its administration of the Revolving Credit, from
restoring any component of Borrowing Base which had been lowered by the Agent
back to the value of such component, as stated in this Agreement or to an
intermediate value.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The amendment
of any financial performance covenant to which direct or indirect reference is
made in the Definition of "Availability" or "Borrowing Base" or in the
Definition of any component thereof shall be subject to amendment as otherwise
provided in this Agreement (and by Consent of the Majority Lenders if not
subject to any other specific provision of this Agreement).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
Any release of any Person obligated on account of the Liabilities.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any amendment or
modification to the date on which any payment of principal, interest, fees, or
other Liabilities are to be paid, including any extension of the Maturity Date.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The making of
any Revolving Credit Loan which, when made, exceeds Availability and is not a
Protective OverAdvance, subject, however, to the following:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) No
Consent is required in connection with the making of any Revolving Credit Loan
to "cover" any honoring of a drawing under any L/C.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Each Lender
recognizes that subsequent to the making of a Revolving Credit Loan which does
not constitute a Protective OverAdvance, the unpaid principal balance of the
Loan Account may exceed Borrowing Base on account of changed circumstances
beyond the control of the Agent (such as a drop in collateral value).</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
Any amendment which has the effect of limiting the Agent's right or ability to
make Protective OverAdvances.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The waiver of
the obligation of the Borrowers to reduce the unpaid principal balance of loans
under the Revolving Credit to an amount so that no OverLoan (other than a
Protective OverAdvance) is outstanding.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Any amendment of Section 7.2(b).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Any amendment of Section 14.7.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any amendment of this Article 16.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Amendment of any of the following Definitions:<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Majority Lender"<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Protective OverAdvance"<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"SuperMajority Lenders<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Unanimous Consent"</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.6. Actions Requiring Agent's Consent.</B> No action, amendment, or waiver of
compliance with, any provision of the Loan Documents or of this Agreement which
affects the Agent in its capacity as Agent may be undertaken without the written
consent of the Agent.(b) No action referenced herein which affects the rights,
duties, obligations, or liabilities of the Agent shall be effective without the
written consent of the Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>16.7. Miscellaneous Actions</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Notwithstanding
any other provision of this Agreement, no single Revolving Credit Lender
independently may exercise any right of action or enforcement against or with
respect to any Borrower.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Agent shall
be fully justified in failing or refusing to take action under this Agreement or
any Loan Document on behalf of any Revolving Credit Lender unless the Agent
shall first</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) receive such
clear, unambiguous, written instructions as the Agent deems appropriate; and<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) be indemnified
to the Agent's satisfaction by the Revolving Credit Lenders against any and all
liability and expense which may be incurred by the Agent by reason of taking or
continuing to take any such action, unless such action had been grossly
negligent, in willful misconduct, or in bad faith.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent may
establish reasonable procedures for the providing of direction and instructions
from the Revolving Credit Lenders to the Agent, including its reliance on
multiple counterparts, facsimile transmissions, and time limits within which
such direction and instructions must be received in order to be included in a
determination of whether the requisite Lenders have provided their direction,
Consent, or instructions.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.8. Actions Requiring Lead Borrower's Consent</B> The Lead Borrower's consent is
required for any amendment of this Agreement, except that each of the following
Articles of this Agreement may be amended without the consent of the Lead
Borrower:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=20%><U>Article</U><BR>
<BR>
12<BR>
<BR>
13<BR>
<BR>
14<BR>
<BR>
15<BR>
<BR>
16</TD>
<TD WIDTH=70%><U>Title of Article</U><BR>
<BR>
Revolving Credit Fundings and Distributions<BR>
<BR>
Acceleration and Liquidation<BR>
<BR>
The Agent<BR>
<BR>
Action By Agents - Consents - Amendments - Waivers<BR>
<BR>
Assignments and Participations</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.9. NonConsenting Revolving Credit Lender</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In the event
that a Revolving Credit Lender (in this Section 16.9, a "<B>NonConsenting Revolving
Credit Lender</B>") does not provide its Consent to a proposal by the Agent to take
action which requires consent under this Article 15, then one or more Revolving
Credit Lenders who provided Consent to such action may require the assignment,
without recourse and in accordance with the procedures outlined in Section 17.1,
below, of the NonConsenting Revolving Credit Lender's commitment hereunder on
fifteen (15) days written notice to the Agent and to the NonConsenting Revolving
Credit Lender.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) At the end of
such fifteen (15) days, and provided that the NonConsenting Revolving Credit
Lender delivers the Revolving Credit Note held by the NonConsenting Revolving
Credit Lender to the Agent, the Revolving Credit Lenders who have given such
written notice shall Transfer the following to the NonConsenting Revolving
Credit Lender:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Such
NonConsenting Revolving Credit Lender's Pro-Rata share of the principal and
interest of the Revolving Credit Loans to the date of such assignment.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) All fees
distributable hereunder to the NonConsenting Revolving Credit Lender to the date
of such assignment.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Any
out-of-pocket costs and expenses for which the NonConsenting Revolving Credit
Lender is entitled to reimbursement from the Borrowers.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the event
that the NonConsenting Revolving Credit Lender fails to deliver to the Agent the
Revolving Credit Note held by the NonConsenting Revolving Credit Lender as
provided in Section 16.9(b) (other than as a result of the subject Revolving
Credit Note having been lost or destroyed, in which event an appropriate lost
note affidavit and indemnity shall suffice), then:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The amount
otherwise to be Transferred to the NonConsenting Revolving Credit Lender shall
be Transferred to the Agent and held by the Agent, without interest, to be
turned over to the NonConsenting Revolving Credit Lender upon delivery of the
Revolving Credit Note held by that NonConsenting Revolving Credit Lender.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Revolving
Credit Note held by the NonConsenting Revolving Credit Lender shall have no
force or effect whatsoever.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The
NonConsenting Revolving Credit Lender shall cease to be a "Revolving Credit
Lender".<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The Revolving
Credit Lender(s) which have Transferred the amount to the Agent as described
above shall have succeeded to all rights and become subject to all of the
obligations of the NonConsenting Revolving Credit Lender as "Revolving Credit
Lender".</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) In the event
that more than One (1) Revolving Credit Lender wishes to require such
assignment, the NonConsenting Revolving Credit Lender's commitment hereunder
shall be divided among such Revolving Credit Lenders, pro-rata based upon their
respective Revolving Credit Percentage Commitments, with the Agent coordinating
such transaction.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Agent shall
coordinate the retirement of the Revolving Credit Note held by the NonConsenting
Revolving Credit Lender and the issuance of Revolving Credit Notes to those
Revolving Credit Lenders which "take-out" such NonConsenting Revolving Credit
Lender, provided, however, no processing fee otherwise to be paid as provided in
Section 17.2(b) shall be due under such circumstances.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 17 Assignments By Revolving Credit Lenders:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17.1. Assignments and Assumptions:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as
provided herein, each Revolving Credit Lender (in this Section 17.1(a), an
"<B>Assigning Revolving Credit Lender</B>") may assign to one or more Eligible
Assignees (in this Section 17.1(a), each an "<B>Assignee Revolving Credit Lender</B>")
all or a portion of that Revolving Credit Lender's interests, rights and
obligations under this Agreement and the Loan Documents (including all or a
portion of its Commitment) and the same portion of the Revolving Credit Loans at
the time owing to it, and of the Revolving Credit Note held by the Assigning
Revolving Credit Lender, provided that:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Agent shall
have given its prior written consent to such assignment, which consent shall not
be unreasonably withheld, but need not be given if the proposed assignment would
result in any resulting Revolving Credit Lender's having a Dollar Commitment of
less than the "minimum hold" amount specified in Section 17.1(a)(iv) or if there
would be more than Three (3) Revolving Credit Lenders.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) So long as no
Default or Event of Default then exists, the Lead Borrower shall have given its
prior written consent to such assignment, which consent shall not be
unreasonably withheld.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Each such
assignment shall be of a constant, and not a varying, percentage of all the
Assigning Revolving Credit Lender's rights and obligations under this Agreement.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Following the
effectiveness of such assignment, the Assigning Revolving Credit Lender's Dollar
Commitment (if not an assignment of all of the Assigning Revolving Credit
Lender's Commitment) shall not be less than $5,000,000.00.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Anything
contained herein to the contrary notwithstanding, the consent of the Agent shall
not be required (and payment of any fees shall not be required) if such
assignment is in connection with any merger, consolidation, sale, transfer, or
other disposition of all or any substantial portion of the business or loan
portfolio of such Assigning Revolving Credit Lender.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>17.2. Assignment Procedures.</B> (This Section 17.2 describes the procedures to be
followed in connection with an assignment effected pursuant to this Article 17
and permitted by Section 17.1).</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The parties to
such an assignment shall execute and deliver to the Agent, for recording in the
Register, an <B>Assignment and Acceptance</B> substantially in the form of <B>EXHIBIT
16.1</B>, annexed hereto.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Assigning
Revolving Credit Lender shall deliver to the Agent, with such Assignment and
Acceptance, the Revolving Credit Note held by the subject Assigning Revolving
Credit Lender and the Agent's processing fee of $2,500.00, provided, however, no
such processing fee shall be due where the Assigning Revolving Credit Lender is
one of the Revolving Credit Lenders at the initial execution of this
Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Agent shall
maintain a copy of each Assignment and Acceptance delivered to it and a register
or similar list (the <B>"Register"</B>) for the recordation of the names and
addresses of the Revolving Credit Lenders and of the Revolving Credit Percentage
Commitment and Revolving Credit Percentage Commitment of each Revolving Credit
Lender. The Register shall be available for inspection by the Revolving Credit
Lenders at any reasonable time and from time to time upon reasonable prior
notice. In the absence of manifest error, the entries in the Register shall be
conclusive and binding on all Revolving Credit Lenders. The Agent and the
Revolving Credit Lenders may treat each Person whose name is recorded in the
Register as a "Revolving Credit Lender" hereunder for all purposes of this
Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Assigning
Revolving Credit Lender and Assignee Revolving Credit Lender, directly between
themselves, shall make all appropriate adjustments in payments for periods prior
to the effective date of an Assignment and Assumption.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.3. Effect of Assignment.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) From and after
the effective date specified in an Assignment and Acceptance which has been
executed, delivered, and recorded (which effective date the Agent may delay by
up to Five (5) Business Days after the delivery of such Assignment and
Acceptance):</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Assignee Revolving Credit Lender:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) Shall be a party
to this Agreement and the Loan Documents (and to any amendments thereof) as
fully as if the Assignee Revolving Credit Lender had executed each.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) Shall have the
rights of a Revolving Credit Lender hereunder to the extent of the Revolving
Credit Percentage Commitment and Revolving Credit Percentage Commitment assigned
by such Assignment and Acceptance.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Assigning
Revolving Credit Lender shall be released from the Assigning Revolving Credit
Lender's obligations under this Agreement and the Loan Documents to the extent
of the Commitment assigned by such Assignment and Acceptance.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Agent
shall undertake to obtain and distribute replacement Revolving Credit Notes to
the subject Assigning Revolving Credit Lender and Assignee Revolving Credit
Lender.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) By executing and
delivering an Assignment and Acceptance, the parties thereto confirm to and
agree with each other and with all parties to this Agreement as to those matters
which are set forth in the subject Assignment and Acceptance.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 18 Notices:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>18.1. Notice Addresses.</B> All notices, demands, and other communications made in
respect of any Loan Document (other than a request for a loan or advance or
other financial accommodation under the Revolving Credit) shall be made to the
following addresses, each of which may be changed upon seven (7) days written
notice to all others given by certified mail, return receipt requested:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=90%>If to the Agent:<BR>
<BR>
Wells Fargo Retail Finance, LLC<BR>
One Boston Place - - 18th Floor<BR>
Boston, Massachusetts 02108<BR>
Attention : David Molinario<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vice President<BR>
Fax : 617-523-4029<BR>
<BR>
With a copy to:<BR>
<BR>
Riemer &amp; Braunstein LLP<BR>
Three Center Plaza<BR>
Boston, Massachusetts 02108<BR>
Attention : Donald E. Rothman, Esquire<BR>
Fax : 617-880-3456<BR>
<BR>
If to the Lead Borrower  and all Borrowers:<BR>
<BR>
The Disney Store, LLC<BR>
c/o The Children's Place Retail Stores, Inc.<BR>
915 Secaucus Road<BR>
Secaucus, New Jersey  07049<BR>
Attention : Chief Financial Officer<BR>
Fax : 201-558-2847<BR>
<BR>
With a copy to:<BR>
<BR>
The Children's Place Stores, Inc.<BR>
915 Secaucus Road<BR>
Secaucus, New Jersey 07094<BR>
Attention : Chief Financial Officer<BR>
Fax : 201-558-2837<BR>
<BR>
With a copy to:<BR>
<BR>
Stroock &amp; Stroock &amp; Lavan LLP<BR>
180 Maiden Lane<BR>
New York, New York  10038-4928<BR>
Attention : Jeffrey Lowental, Esq.<BR>
Fax : 212-806-6006</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3><B>18.2.    Notice Given.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as
otherwise specifically provided herein, notices shall be deemed made and
correspondence received, as follows (all times being local to the place of
delivery or receipt):</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) By mail: the
sooner of when actually received or Three (3) days following deposit in the
United States mail, postage prepaid.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) By recognized
overnight express delivery: the Business Day following the day when sent.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) By Hand: If
delivered on a Business Day after 9:00 AM and no later than Three (3) hours
prior to the close of customary business hours of the recipient, when delivered.
Otherwise, at the opening of the then next Business Day.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) By Facsimile
transmission (which must include a header on which the party sending such
transmission is indicated): If sent on a Business Day after 9:00 AM and no later
than Three (3) hours prior to the close of customary business hours of the
recipient, one (1) hour after being sent. Otherwise, at the opening of the then
next Business Day.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Rejection or
refusal to accept delivery and inability to deliver because of a changed address
or Facsimile Number for which no due notice was given shall each be deemed
receipt of the notice sent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>18.3. Wire Instructions.</B> Notice Given. Subject to change in the same manner that
a notice address may be changed (as to which, see Section 18.1), wire transfers
to the Agent shall be made in accordance with the following wire instructions:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=90%>Wells Fargo Bank<BR>
San Francisco, CA<BR>
ABA # 121-000-248<BR>
Wells Fargo Retail Finance, LLC<BR>
Account Number - 4945088607<BR>
: Disney Stores N. A., Inc.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3><B>Article 19 Term:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>19.1. Termination of Revolving Credit.</B> The Revolving Credit shall remain in
effect (subject to suspension as provided in Section 2.6 hereof) until the
Termination Date.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>19.2. Actions On Termination.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On the
Termination Date, the Borrowers shall pay the Agent (whether or not then due),
in immediately available funds, all then Liabilities including, without
limitation: the following:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The entire
balance of the Loan Account (including the unpaid principal balance of the
Revolving Credit Loans).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Any payments
due on account of the indemnification obligations included in Section 2.10(e).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Any remaining
installment of the Revolving Credit Closing Fee.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any accrued and
unpaid Unused Line Fee.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Any applicable
Revolving Credit Early Termination Fee.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) All
unreimbursed costs and expenses of the Agent and of Lenders' Special Counsel for
which each Borrower is responsible.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) All other Liabilities.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) On the
Termination Date, the Borrowers shall also shall make such arrangements
concerning any L/C's and any Bank Products and Bank Product Obligations then
outstanding as are reasonably satisfactory to the Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Until such
payment (Section 19.2(a)) and arrangements concerning L/C's, Bank Products, and
Bank Product Obligations (Section 19.2(b)), all provisions of this Agreement,
other than those included in Article 2 which place any obligation on the Agent
or any Revolving Credit Lender to make any loans or advances or to provide any
financial accommodations to any Borrower shall remain in full force and effect
until all Liabilities shall have been paid in full.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The release by
the Agent of the Collateral Interests granted the Agent by the Borrowers
hereunder may be upon such conditions and indemnifications as the Agent may
require.</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3><B>Article 20 General:</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.1. Protection of Collateral.</B> The Agent has no duty as to the collection or
protection of the Collateral beyond the safe custody of such of the Collateral
as may come into the possession of the Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.2. Publicity.</B> The Agent may issue a "tombstone" notice of the establishment
of the credit facility contemplated by this Agreement and may make reference to
each Borrower (and may utilize any logo or other distinctive symbol associated
with each Borrower) in connection with any advertising, promotion, or marketing
(including reference in any "case study" of the creditor facility contemplated
hereby) undertaken by the Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.3. Successors and Assigns.</B> This Agreement shall be binding upon the Borrowers
and their respective representatives, successors, and assigns and shall inure to
the benefit of the Agent and each Revolving Credit Lender and their respective
successors and assigns, provided, however, no trustee or other fiduciary
appointed with respect to any Borrower shall have any rights hereunder. In the
event that the Agent or any Revolving Credit Lender assigns or transfers its
rights under this Agreement, the assignee shall thereupon succeed to and become
vested with all rights, powers, privileges, and duties of such assignor
hereunder and such assignor shall thereupon be discharged and relieved from its
duties and obligations hereunder.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.4. Severability.</B> Any determination that any provision of this Agreement or
any application thereof is invalid, illegal, or unenforceable in any respect in
any instance shall not affect the validity, legality, or enforceability of such
provision in any other instance, or the validity, legality, or enforceability of
any other provision of this Agreement.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.5. Amendments. Course of Dealing.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Agreement
and the other Loan Documents incorporate all discussions and negotiations
between each Borrower and the Agent and each Revolving Credit Lender, either
express or implied, concerning the matters included herein and in such other
instruments, any custom, usage, or course of dealings to the contrary
notwithstanding. No such discussions, negotiations, custom, usage, or course of
dealings shall limit, modify, or otherwise affect the provisions thereof. No
failure by the Agent or any Revolving Credit Lender to give notice to the Lead
Borrower of any Borrower's having failed to observe and comply with any warranty
or covenant included in any Loan Document shall constitute a waiver of such
warranty or covenant or the amendment of the subject Loan Document. No change
made by the Agent to the manner by which Borrowing Base is determined shall
obligate the Agent to continue to determine Borrowing Base in that
manner.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower
may undertake any action otherwise prohibited hereby, and may omit to take any
action otherwise required hereby, upon and with the express prior written
consent of the Agent. Subject to Article 15, no consent, modification,
amendment, or waiver of any provision of any Loan Document shall be effective
unless executed in writing by or on behalf of the party to be charged with such
modification, amendment, or waiver (and if such party is the Agent then by a
duly authorized officer thereof). Any modification, amendment, or waiver
provided by the Agent shall be in reliance upon all representations and
warranties theretofore made to the Agent by or on behalf of the Borrowers (and
any guarantor, endorser, or surety of the Liabilities) and consequently may be
rescinded in the event that any of such representations or warranties was not
true and complete in all material respects when given.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.6. Power of Attorney.</B> In connection with all powers of attorney included in
this Agreement, each Borrower hereby grants unto the Agent (acting through any
of its officers) full power to do any and all things necessary or appropriate in
connection with the exercise of such powers as fully and effectually as that
Borrower might or could do, hereby ratifying all that said attorney shall do or
cause to be done by virtue of this Agreement. No power of attorney set forth in
this Agreement shall be affected by any disability or incapacity suffered by any
Borrower and each shall survive the same. All powers conferred upon the Agent by
this Agreement, being coupled with an interest, shall be irrevocable until this
Agreement is terminated by a written instrument executed by a duly authorized
officer of the Agent.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.7. Application of Proceeds.</B> The proceeds of any collection, sale, or
disposition of the Collateral, or of any other payments received hereunder,
shall be applied towards the Liabilities in such order and manner as the Agent
determines in its sole discretion, consistent, however, with Sections 14.6 and
14.7 and any other applicable provisions of this Agreement. The Borrowers shall
remain liable for any deficiency remaining following such application.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.8. Increased Costs.</B> If, as a result of any Requirement of Law, or of the
interpretation or application thereof by any court or by any governmental or
other authority or entity charged with the administration thereof, whether or
not having the force of law, which:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a) subjects any Revolving Credit Lender to any taxes or changes the basis of
taxation, or increases any existing taxes, on payments of principal, interest or
other amounts payable by any Borrower to the Agent or any Revolving Credit
Lender under this Agreement (except for taxes on the Agent or any Revolving
Credit Lender based on net income or capital imposed by the jurisdiction in
which the principal or lending offices of the Agent or that Revolving Credit
Lender are located);<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) imposes,
modifies or deems applicable any reserve, cash margin, special deposit or
similar requirements against assets held by, or deposits in or for the account
of or loans by or any other acquisition of funds by the relevant funding office
of any Revolving Credit Lender;<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) imposes on any
Revolving Credit Lender any other condition with respect to any Loan Document;
or<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) imposes on any
Revolving Credit Lender a requirement to maintain or allocate capital in
relation to the Liabilities;</TD>
</TR>
</TABLE>
<BR>

<P ALIGN=LEFT><FONT SIZE=3>and the result of any of the foregoing, in such Revolving Credit Lender&#146;s
reasonable opinion, is to increase the cost to that Revolving Credit Lender of
making or maintaining any loan, advance or financial accommodation or to reduce
the income receivable by that Revolving Credit Lender in respect of any loan,
advance or financial accommodation by an amount which that Revolving Credit
Lender deems to be material, then upon written notice from the Agent, from time
to time, to the Lead Borrower (such notice to set out in reasonable detail the
facts giving rise to and a summary calculation of such increased cost or reduced
income), the Borrowers shall forthwith pay to the Agent, for the benefit of the
subject Revolving Credit Lender, upon receipt of such notice, that amount which
shall compensate the subject Revolving Credit Lender for such additional cost or
reduction in income.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.9. Costs and Expenses of the Agent.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Borrowers
shall pay from time to time on demand all Costs of Collection and all reasonable
costs, expenses, and disbursements (including attorneys' reasonable fees and
expenses) which are incurred by the Agent in connection with the preparation,
negotiation, execution, and delivery of this Agreement and of any other Loan
Documents, and all other reasonable costs, expenses, and disbursements which may
be incurred in connection with or in respect to the credit facility contemplated
hereby or which otherwise are incurred with respect to the
Liabilities.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Borrowers
shall pay from time to time on demand all reasonable costs and expenses
(including attorneys' reasonable fees and expenses) incurred, following the
occurrence of any Event of Default, by the Revolving Credit Lenders to Lenders'
Special Counsel.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Borrower
authorizes the Agent to pay all such fees and expenses and in the Agent's
discretion, to add such fees and expenses to the Loan Account.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The undertaking
on the part of each Borrower in this Section 20.9 shall survive payment of the
Liabilities and/or any termination, release, or discharge executed by the Agent
in favor of any Borrower, other than a termination, release, or discharge which
makes specific reference to this Section 20.9.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.10. Copies and Facsimiles.</B> Each Loan Document and all documents and papers
which relates thereto which have been or may be hereinafter furnished the Agent
or any Revolving Credit Lender may be reproduced by that Revolving Credit Lender
or by the Agent by any photographic, microfilm, xerographic, digital imaging, or
other process, and such Person making such reproduction may destroy any document
so reproduced. Any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding (whether or not the
original is in existence and whether or not such reproduction was made in the
regular course of business). Any facsimile which bears proof of transmission
shall be binding on the party which or on whose behalf such transmission was
initiated and likewise shall be so admissible in evidence as if the original of
such facsimile had been delivered to the party which or on whose behalf such
transmission was received.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.11. Massachusetts Law.</B> This Agreement and all rights and obligations
hereunder, including matters of construction, validity, and performance, shall
be governed by the law of The Commonwealth of Massachusetts.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.12. Consent to Jurisdiction.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Borrower
agrees that any legal action, proceeding, case, or controversy against any
Borrower with respect to any Loan Document may be brought in the Superior Court
of Suffolk County Massachusetts or in the United States District Court, District
of Massachusetts, sitting in Boston, Massachusetts, as the Agent may elect in
the Agent's sole discretion. By execution and delivery of this Agreement, each
Borrower, for itself and in respect of its property, accepts, submits, and
consents generally and unconditionally, to the jurisdiction of the aforesaid
courts.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Borrower
WAIVES personal service of any and all process upon it, and 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 certified mail, postage
prepaid, to the Lead Borrower at the Lead Borrower's address for notices as
specified herein, such service to become effective five (5) Business Days after
such mailing.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Borrower
WAIVES any objection based on forum non conveniens and any objection to venue of
any action or proceeding instituted under any of the Loan Documents and consents
to the granting of such legal or equitable remedy as is deemed appropriate by
the Court.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Nothing herein
shall affect the right of the Agent to bring legal actions or proceedings in any
other competent jurisdiction.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Each Borrower
agrees that any action commenced by any Borrower asserting any claim arising
under or in connection with this Agreement or any other Loan Document shall be
brought solely in the Superior Court of Suffolk County Massachusetts or in the
United States District Court, District of Massachusetts, sitting in Boston,
Massachusetts, and that such Courts shall have exclusive jurisdiction with
respect to any such action.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>20.13.
Indemnification.</B> Each Borrower shall indemnify, defend, and hold the Agent
and each Revolving Credit Lender and any Participant and any of their respective
employees, officers, or agents (each, an "<B>Indemnified Person</B>") harmless
of and from any claim brought or threatened against any Indemnified Person by
any Borrower, any guarantor or endorser of the Liabilities, or any other Person
(as well as from attorneys' reasonable fees, expenses, and disbursements in
connection therewith) on account of the relationship of the Borrowers or of any
other guarantor or endorser of the Liabilities, including all costs, expenses,
liabilities, and damages as may be suffered by any Indemnified Person in
connection with (x) the Collateral; (y) the occurrence of any Event of Default;
or (z) the exercise of any rights or remedies under any of the Loan Documents
(each of claims which may be defended, compromised, settled, or pursued by the
Indemnified Person with counsel of the Lender's selection, but at the expense of
the Borrowers) other than any claim as to which a final determination is made in
a judicial proceeding (in which the Agent and any other Indemnified Person has
had an opportunity to be heard), which determination includes a specific finding
that the Indemnified Person seeking indemnification had acted in a grossly
negligent manner or in actual bad faith. This indemnification shall survive
payment of the Liabilities and/or any termination, release, or discharge
executed by the Agent in favor of the Borrowers, other than a termination,
release, or discharge duly executed on behalf of the Agent which makes specific
reference to this Section 20.13.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.14. Rules of Construction.</B> The following rules of construction shall be
applied in the interpretation, construction, and enforcement of this Agreement
and of the other Loan Documents:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
Unless otherwise specifically provided for herein (and then only to the extent
so provided), interest and any fee or charge which is stated as a per annum
percentage shall be calculated based on a 360 day year and actual days elapsed.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Words in the
singular include the plural and words in the plural include the singular.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Unless otherwise
specifically provided for herein or in a specific Loan Document (and then only
to the extent so provided), as between the parties hereto or to any Loan
Document, the definitions of the following terms, as included in the UCC, are
deemed to be as follows for purposes of the performance of obligations arising
under or in respect of any Loan Document:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) "Authenticate" means "signed".<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) "Record" means
written information in a tangible form.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
Cross references to Sections in this Agreement begin with the Article in which
that Section appears, and then the Section to which reference is made.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Titles, headings
(indicated by being underlined or shown in Small Capitals) and any Table of
Contents are solely for convenience of reference; do not constitute a part of
the instrument in which included; and do not affect such instrument's meaning,
construction, or effect.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The words
"includes" and "including" are not limiting.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Text which
follows the words "including, without limitation" (or similar words) is
illustrative and not limitational.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Text which is
shown in italics (except for parenthesized italicized text), shown in bold,
shown IN ALL CAPITAL LETTERS, or in any combination of the foregoing, shall be
deemed to be conspicuous.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The words "may
not" are prohibitive and not permissive.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Any reference to
a Person's "knowledge" (or words of similar import) are to such Person's
knowledge assuming that such Person has undertaken reasonable and diligent
investigation with respect to the subject of such "knowledge" (whether or not
such investigation has actually been undertaken).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) Terms which are
defined in one section of any Loan Document are used with such definition
throughout the instrument in which so defined.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) The term
"Dollars" and the symbol "$" each refers to United States Dollars.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) Unless limited
by reference to a particular Section or provision, any reference to "herein",
"hereof", or "within" is to the entire Loan Document in which such reference is
made.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) References to
"this Agreement" or to any other Loan Document is to the subject instrument as
amended to the date on which application of such reference is being made.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) Except as
otherwise specifically provided, all references to time are to Boston time.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) In the
determination of any notice, grace, or other period of time prescribed or
allowed hereunder:</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=90%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
Unless otherwise provided (I) the day of the act, event, or default from which
the designated period of time begins to run shall not be included and the last
day of the period so computed shall be included unless such last day is not a
Business Day, in which event the last day of the relevant period shall be the
then next Business Day and (II) the period so computed shall end at 5:00 PM on
the relevant Business Day.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The word "from" means "from and including".<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The words "to"
and "until" each mean "to, but excluding".<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The word "through" means "to and including".</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q)
The Loan Documents shall be construed and interpreted in a harmonious manner and
in keeping with the intentions set forth in Section 20.15 hereof, provided,
however, in the event of any inconsistency between the provisions of this
Agreement and any other Loan Document, the provisions of this Agreement shall
govern and control.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.15. Intent.</B> It is intended that:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
This Agreement take effect as a sealed instrument.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The scope of all
Collateral Interests created by any Borrower to secure the Liabilities be
broadly construed in favor of the Agent and that they cover all assets of each
Borrower.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All Collateral
Interests created in favor of the Agent at any time and from time to time secure
all Liabilities, whether now existing or contemplated or hereafter arising.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) All reasonable
costs, expenses, and disbursements incurred by the Agent and, to the extent
provided in Section 20.9 each Revolving Credit Lender, in connection with such
Person's relationship(s) with any Borrower shall be borne by the Borrowers.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Unless otherwise
explicitly provided herein, the Agent's consent to any action of any Borrower
which is prohibited unless such consent is given may be given or refused by the
Agent in its sole discretion and without reference to Section 2.17(a)
hereof.</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.16. Right of Set-Off.</B> Any and all deposits or other sums at any time credited
by or due to any Borrower from the Agent or any Revolving Credit Lender or any
Participant or from any Affiliate of any of the foregoing, and any cash,
securities, instruments or other property of any Borrower in the possession of
any of the foregoing, whether for safekeeping or otherwise (regardless of the
reason such Person had received the same) shall at all times constitute security
for all Liabilities and for any and all obligations of each Borrower to the
Agent and such Revolving Credit Lender or any Participant or such Affiliate and
may be applied or set off against the Liabilities and against such obligations
at any time, whether or not such are then due and whether or not other
collateral is then available to the Agent or that Revolving Credit Lender.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.17. Pledges To Federal Reserve Banks:</B> Nothing included in this Agreement
shall prevent or limit any Revolving Credit Lender, to the extent that such
Revolving Credit Lender is subject to any of the twelve Federal Reserve Banks
organized underss.4 of the Federal Reserve Act (12 U.S.C.ss.341) from pledging
all or any portion of that Lender's interest and rights under this Agreement,
provided, however, neither such pledge nor the enforcement thereof shall release
the pledging Revolving Credit Lender from any of its obligations hereunder or
under any of the Loan Documents.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>20.18. Maximum Interest Rate.</B> Regardless of any provision of any Loan Document,
neither the Agent nor any Revolving Credit Lender shall be entitled to contract
for, charge, receive, collect, or apply as interest on any Liability, any amount
in excess of the maximum rate imposed by Applicable Law. Any payment which is
made which, if treated as interest on a Liability would result in such
interest's exceeding such maximum rate shall be held, to the extent of such
excess, as additional collateral for the Liabilities as if such excess were
"Collateral."</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>20.19. Waivers.</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Borrower
(and all guarantors, endorsers, and sureties of the Liabilities) make each of
the waivers included in Section 20.19(b), below, knowingly, voluntarily, and
intentionally, and understands that Agent and each Revolving Credit Lender, in
establishing the facilities contemplated hereby and in providing loans and other
financial accommodations to or for the account of the Borrowers as provided
herein, whether not or in the future, is relying on such waivers.</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) EACH BORROWER,
AND EACH SUCH GUARANTOR, ENDORSER, AND SURETY RESPECTIVELY WAIVES THE
FOLLOWING:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=95%>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Except as
otherwise specifically required hereby, notice of non-payment, demand,
presentment, protest and all forms of demand and notice, both with respect to
the Liabilities and the Collateral.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Except as
otherwise specifically required hereby, the right to notice and/or hearing prior
to the Agent's exercising of the Agent's rights upon default.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) THE RIGHT TO A
JURY IN ANY TRIAL OF ANY CASE OR CONTROVERSY IN WHICH THE AGENT OR ANY REVOLVING
CREDIT LENDER IS OR BECOMES A PARTY (WHETHER SUCH CASE OR CONTROVERSY IS
INITIATED BY OR AGAINST THE AGENT OR ANY REVOLVING CREDIT LENDER OR IN WHICH THE
AGENT OR ANY REVOLVING CREDIT LENDER IS JOINED AS A PARTY LITIGANT), WHICH CASE
OR CONTROVERSY ARISES OUT OF OR IS IN RESPECT OF, ANY RELATIONSHIP AMONGST OR
BETWEEN ANY BORROWER OR ANY OTHER PERSON AND THE AGENT AND EACH REVOLVING CREDIT
LENDER LIKEWISE WAIVES THE RIGHT TO A JURY IN ANY TRIAL OF ANY SUCH CASE OR
CONTROVERSY).<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The benefits or
availability of any stay, limitation, hindrance, delay, or restriction
(including, without limitation, any automatic stay which otherwise might be
imposed pursuant to Section 362 of the Bankruptcy Code) with respect to any
action which the Agent may or may become entitled to take hereunder.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Any defense,
counterclaim, set-off, recoupment, or other basis on which the amount of any
Liability, as stated on the books and records of the Agent, could be reduced or
claimed to be paid otherwise than in accordance with the tenor of and written
terms of such Liability.<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Any claim to
consequential, special, or punitive damages.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%></TD>
<TD WIDTH=50%><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;("Lead Borrower")</B><BR>
<BR>
<B>THE DISNEY STORE, LLC</B><BR>
<BR>
By <U>/s/ Steven Balasiano&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: Steven Balasiano<BR>
<BR>
Title: Senior Vice President<BR>
<BR>
<BR>
<B>&#147;Borrowers&#148;:</B><BR>
<BR>
<B>THE DISNEY STORE, LLC</B><BR>
<BR>
By <U>/s/ Steven Balasiano&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: Steven Balasiano<BR>
<BR>
Title: Senior Vice President<BR>
<BR>
<BR>
<B>HOOP RETAIL STORES, LLC</B><BR>
<BR>
By <U>/s/ Steven Balasiano&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: Steven Balasiano<BR>
<BR>
Title: Senior Vice President<BR>
<BR>
<BR>
<B>&#147;Guarantor&#148;</B><BR>
<BR>
<B>HOOP CANADA HOLDINGS, INC.</B><BR>
<BR>
By <U>/s/ Steven Balasiano&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: Steven Balasiano<BR>
<BR>
Title: Senior Vice President<BR>
<BR>
<BR>
<B>"Secondary Guarantors"</B><BR>
<BR>
<B>THE DISNEY STORE (CANADA) LTD.</B><BR>
<BR>
By <U>/s/ Steven Balasiano&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: Steven Balasiano<BR>
<BR>
Title: Senior Vice President<BR>
<BR>
<BR>
<B>HOOP CANADA, INC.</B><BR>
<BR>
By <U>/s/ Steven Balasiano&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: Steven Balasiano<BR>
<BR>
Title: Senior Vice President<BR>
<BR>
<BR>
<B>(&#147;Agent&#148;)</B><BR>
<BR>
<B>WELLS FARGO RETAIL FINANCE, LLC</B><BR>
<BR>
By <U>/s/ David Molinario&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: David Molinario<BR>
<BR>
Title: Vice President<BR>
<BR>
<BR>
<B>WELLS FARGO RETAIL FINANCE, LLC,<BR>
As Revolving Credit Lender</B><BR>
<BR>
By: <U>/s/ David Molinario&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: David Molinario<BR>
<BR>
Title: Vice President<BR>
<BR>
<BR>
<B>CONGRESS FINANCIAL CORPORATION (NEW ENGLAND), As Documentation Agent<BR>
and as Revolving Credit Lender</B><BR>
<BR>
By:<U>/s/ Christopher S. Hudik&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: Christopher S. Hudik<BR>
<BR>
Title: First Vice President<BR><BR>
<BR>
<BR>
<B>LASALLE RETAIL FINANCE,<BR>
a Division of LaSalle Business Credit, LLC,<BR>
as Agent for Standard Federal Bank National Association,<BR>
As Co-Agent and as Revolving Credit Lender</B><BR>
<BR>
By:<U>/s/ Matthew D. Potter&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name:  Matthew D. Potter<BR>
<BR>
Title: Assistant Vice President<BR>
<BR>
<BR>
<B>WEBSTER BUSINESS CREDIT CORP.,<BR>
as Revolving Credit Lender</B><BR>
<BR>
By:<U>/s/ Evan Israelson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Print Name: Evan Israelson<BR>
<BR>
Title: Vice President</TD>
</TR>
</TABLE>
<BR>


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</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>7
<FILENAME>tcp-ex31_120804.htm
<DESCRIPTION>EXHIBIT 31
<TEXT>
<HTML>
<HEAD>
<TITLE>Exhibit 31</TITLE>
</HEAD>
<BODY>

<P ALIGN=CENTER><FONT SIZE=3><B>EXHIBIT 31</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>SECTION 302 CERTIFICATIONS</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>CERTIFICATIONS</B></FONT></P>

<P><FONT SIZE=3>I, Ezra Dabah, certify that:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I have reviewed this quarterly
report on Form 10-Q of The Children's Place Retail Stores, Inc.; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The registrant's other certifying
officers 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)) for the registrant and have:
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The registrant's other certifying
officers 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
equivalent functions): </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All significant deficiencies and material
weaknesses in the design or operation of internal controls over financial
reporting which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial information; and
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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. </FONT></P>
<BR>
<BR>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>Date: December 9, 2004</TD>
<TD WIDTH=50%>
By: <U>/s/ Ezra Dabah
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chairman of the Board and<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Executive Officer
</TD>
</TR>
</TABLE>
<BR>

<PAGE>

<P ALIGN=CENTER><FONT SIZE=3><B>CERTIFICATIONS</B></FONT></P>

<P><FONT SIZE=3>I, Seth L. Udasin, certify that:</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I have reviewed this quarterly
report on Form 10-Q of The Children's Place Retail Stores, Inc.; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The registrant's other certifying
officers 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)) for the registrant and have:
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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; </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The registrant's other certifying
officers 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
equivalent functions): </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All significant deficiencies and material
weaknesses in the design or operation of internal controls over financial
reporting which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial information; and
</FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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. </FONT></P>
<BR>
<BR>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>Date: December 9, 2004</TD>
<TD WIDTH=50%>
By: <U>/s/ Seth L. Udasin
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vice President and<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Financial Officer
</TD>
</TR>
</TABLE>
<BR>

</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>8
<FILENAME>tcp-ex32_120804.htm
<DESCRIPTION>EXHIBIT 32
<TEXT>
<HTML>
<HEAD>
<TITLE>Exhibit 32</TITLE>
</HEAD>
<BODY>

<P ALIGN=CENTER><FONT SIZE=3><B>EXHIBIT 32</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>SECTION 906 CERTIFICATIONS</B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>CERTIFICATIONS</B></FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
I, Ezra Dabah, Chairman and Chief Executive Officer of The Children&#146;s Place
Retail Stores, Inc. (the &#147;Company&#148;), pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, do hereby certify as follows: </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>1.</TD>
<TD WIDTH=95%>
The quarterly report of the Company on Form 10-Q for the period ended October
30, 2004 fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934; and
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>2.</TD>
<TD WIDTH=95%>
The information contained in such quarterly report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.
</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>IN WITNESS WHEREOF, I have executed this Certification this 9th
day of December, 2004. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>&nbsp;</TD>
<TD WIDTH=50%>
By: <U>/s/  Ezra Dabah
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chairman of the Board and<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Executive Officer
</TD>
</TR>
</TABLE>
<BR>
<BR>
<BR>
<BR>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
I, Seth L. Udasin, Vice President and Chief Financial Officer of The Children's
Place Retail Stores, Inc. (the "Company"), pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, do hereby certify as follows: </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>1.</TD>
<TD WIDTH=95%>
The quarterly report of the Company on Form 10-Q for the period ended October
30, 2004 fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934; and
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%>2.</TD>
<TD WIDTH=95%>
The information contained in such quarterly report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.
</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>IN WITNESS WHEREOF, I have executed this Certification this 9th
day of December, 2004. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%>&nbsp;</TD>
<TD WIDTH=50%>
By: <U>/s/ Seth L. Udasin
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vice President and<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Financial Officer
</TD>
</TR>
</TABLE>
<BR>

</BODY>
</HTML>

</TEXT>
</DOCUMENT>
</SUBMISSION>
