ASSET PURCHASE AGREEMENT

Asset Purchase Agreement

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Children's Place Retail Stores, Inc | Children's Place Services Company, LLC | Disney Enterprises, Inc | Hoop Canada, Inc | Hoop Retail Stores, LLC | T1 WDC Inc

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Title: ASSET PURCHASE AGREEMENT
Governing Law: California Date: 4/7/2008
Industry: Retail (Apparel) Sector: Services

ASSET PURCHASE AGREEMENT, Parties: children's place retail stores inc , children's place services company llc , disney enterprises inc , hoop canada inc , hoop retail stores llc , t1 wdc inc

Exhibit 10.1

EXECUTION VERSION

ASSET PURCHASE AGREEMENT

dated as of

April 3, 2008

by and among

T2 Acquisition, LLC,

T1 WDC Inc.,

The Children's Place Services Company, LLC,

Hoop Retail Stores, LLC,

and

Hoop Canada, Inc.

TABLE OF CONTENTS

		Page
ARTICLE I	DEFINITIONS	3
1.1	Definitions	3
1.2	Interpretation	20

ARTICLE II	PURCHASE AND SALE OF ASSETS	21
2.1	Acquired Assets	21
2.2	Headquarters Office	26
2.3	Retained Assets	26
2.4	Assumed Liabilities	27
2.5	Retained Liabilities	28
2.6	Inventory Count	29
2.7	Purchase Price; Payments at Closing.	29
2.8	Post-Closing Adjustments.	31
2.9	Setoff of Amounts	34

ARTICLE III	CLOSING	35
3.1	Closing.	35
3.2	Filings	36
3.3	Closing Deliveries by Seller	37
3.4	Closing Deliveries by USA Buyer and Canadian Buyer	37
3.5	Conditions Precedent to Obligations of Each Party	38
3.6	Conditions Precedent to Obligations of Buyer	39
3.7	Conditions Precedent to Obligations of Seller	40

ARTICLE IV	REPRESENTATIONS AND WARRANTIES OF SELLER	41
4.1	Organization.	41
4.2	Financial Statements	41
4.3	Accounting Records and Accounting Controls; Minute Books.	41
4.4	Tax Matters.	42
4.5	Contracts.	43
4.6	Leases and Real Property.	43
4.7	Information Technology	44
4.8	Authorization; No Conflicts.	45
4.9	Legal Proceedings.	45
4.10	Permits	46
4.11	Compliance with Law	46
4.12	Employee Schedule	46
4.13	Environmental Compliance	46

		Page
4.14	No Brokers or Finders	46
4.15	Absence of Certain Changes and Events	46
4.16	Title to Assets	47
4.17	Labor Matters	47
4.18	No Other Agreements to Sell	47
4.19	Payments	47

ARTICLE V	REPRESENTATIONS AND WARRANTIES OF BUYER	48
5.1	Organization; Capitalization.	48
5.2	Authorization; No Conflicts.	48
5.3	Legal Proceedings	49
5.4	No Brokers or Finders	49
5.5	GST	49

ARTICLE VI	COVENANTS	49
6.1	Tax Matters.	49
6.2	Other Cooperation	52
6.3	Effect of Due Diligence and Related Matters	53
6.4	Employee Matters.	53
6.5	Wind-Down of Stores Other than Acquired Stores; Termination of License Agreement; Preservation of Buyer Claims.	55
6.6	Additional Covenants of Seller Prior to the Applicable Closing	59
6.7	Reimbursement of Prepaid Rent	61
6.8	Transitional Services Agreement	61

ARTICLE VII	TERMINATION	61
7.1	Termination	61
7.2	Procedure and Effect of Termination.	62

Article VIII	GENERAL	63
8.1	Non-Survival	63
8.2	Entire Agreement	63
8.3	Annexes and Schedules	63
8.4	Amendments	63
8.5	Assignment	63
8.6	Effect of Headings	64
8.7	Counterparts; Facsimile and Electronic Signatures	64
8.8	Publicity and Reports	64
8.9	Confidentiality	64
8.10	No Third Party Beneficiaries	65
8.11	Notices	65
8.12	Expenses	67
8.13	Interest	67

		Page
8.14	Waivers	67
8.15	Construction	67
8.16	Severability	67
8.17	Governing Law; Venue; Remedies; Waiver of Jury Trial.	67
8.18	Limitation of Liability	68
8.19	Release Agreement	69

iii

ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT (this " Agreement ") is entered into as of April 3, 2008, by and among Hoop Retail Stores, LLC, a Delaware limited liability company (" USA Seller "), Hoop Canada, Inc., a corporation incorporated under the laws of the Province of New Brunswick, Canada (" Canadian Seller " and, together with USA Seller, collectively, " Seller "), The Children's Place Services Company, LLC, a Delaware limited liability company (" TCP Services Co. ", but only with respect to the specific matters relating to TCP Services Co. as set forth herein), T2 Acquisition, LLC, a Delaware limited liability company (" USA Buyer "), and T1 WDC Inc., a corporation incorporated under the laws of the Province of Nova Scotia, Canada (" Canadian Buyer " and, together with USA Buyer, collectively, " Buyer ") (Seller and TCP Services Co., on the one hand, and Buyer, on the other hand, are sometimes referred to each as a " party " and collectively as the " parties ").

W I T N E S S E T H :

WHEREAS, USA Seller and Canadian Seller, which are wholly owned Subsidiaries of The Children's Place Retail Stores, Inc., a Delaware corporation (" TCP "), are engaged in the operation of a chain of specialty retail stores operated under the "Disney Store" name in the United States and Canada pursuant to the License Agreement;

WHEREAS, (i) Buyer desires to acquire certain of such specialty retail stores by way of the purchase by USA Buyer of the USA Acquired Assets from USA Seller and by Canadian Buyer of the Canadian Acquired Assets from Canadian Seller, and (ii) USA Seller and Canadian Seller wish to transfer such specialty retail stores by way of the sale of the USA Acquired Assets by USA Seller to USA Buyer and the sale of the Canadian Acquired Assets by Canadian Seller to Canadian Buyer, all in accordance with the terms and subject to the conditions of this Agreement;

WHEREAS, Seller's authority to operate the Stores using the "Disney Store" name and trademarks owned by Disney Enterprises, Inc., a Delaware corporation (" DEI "), and its Affiliates, including TDSF, and to sell the Disney Merchandise that is subject to copyrights and trademarks owned by DEI and its Affiliates derives solely from the License Agreement, a nonexclusive copyright and trademark license;

WHEREAS, TDSF alleges that the License Agreement is nonassignable as a matter of federal copyright and trademark law, and therefore nonassumable by Seller in the Bankruptcy Case pursuant to Section 365(c)(1) of the Bankruptcy Code;

WHEREAS, a Private Sale will be in the best interests of Seller;

WHEREAS, this Agreement was negotiated and documented with the understanding of all of the parties hereto that Seller would be filing a bankruptcy case and that the transactions contemplated herein would be carried out in such bankruptcy case; and

WHEREAS, TCP, DEI and TDSF have entered into a Mutual Release Agreement, dated as of March 17, 2008 (the " Mutual Release "), and concurrently herewith, TCP, DEI and TDSF are entering into a Support Agreement, dated as of even date herewith, pursuant to which, among other things, TCP has agreed to support this Agreement and the transactions contemplated hereby, including the filings with the Bankruptcy Court described in Section 3.2 (the " Support Agreement ").

NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements contained herein, the parties agree as follows:

ARTICLE I

DEFINITIONS

1.1 Definitions . As used in this Agreement, the following defined terms shall have the respective meanings set forth below:

" Acquired Agreements " has the meaning specified in Section 2.1.6 .

" Acquired Assets " has the meaning specified in Section 2.1 .

" Acquired Car Leases " has the meaning specified in Section 2.1.10 .

" Acquired Inventory " means the USA Acquired Inventory and the Canadian Acquired Inventory.

" Acquired Leases " means any and all Contracts under which the premises of the Acquired Stores (and related storage space, if any) are leased to USA Seller or Canadian Seller.

" Acquired Store Employees " has the meaning specified in Section 6.4.1 .

" Acquired Stores " means the specialty retail stores leased and operated by USA Seller or Canadian Seller under the " Disney Store " name and set forth on the Acquired Stores Schedule (as such schedule may be amended pursuant to Section 2.1 ).

" Acquired Stores Schedule " means Annex A , which sets forth the Acquired Stores by store number, location (by mall name or otherwise), city, state/province and country and such other information as the parties may desire (as such schedule may be amended pursuant to Section 2.1 ).

" Acquired Supplies " means the USA Acquired Supplies and the Canadian Acquired Supplies.

" Action " 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.

" Adjustment Statement " has the meaning specified in Section 2.8.1 .

" Adjustment Statement Due Date " has the meaning specified in Section 2.8.1 .

" Adjustment Statement Objection " has the meaning specified in Section 2.8.2 .

" Affiliate " 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; provided , that (i) in no event shall Seller or any of its Affiliates be deemed an Affiliate of Buyer or any of its Affiliates 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 Buyer: (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."

" Agreement " means this Agreement by and among the parties as amended, restated or supplemented from time to time.

" Applicable Closing " means the USA Closing or the Canadian Closing, as applicable or as the context may require.

" Applicable Closing Date " means the USA Closing Date or the Canadian Closing Date, as applicable or as the context may require.

" Applicable Petition Date " means the USA Petition Date or the Canadian Petition Date, as applicable or as the context may require.

" Assumed Liabilities " has the meaning specified in Section 2.4 .

" Assumed Real Estate Taxes " means the portion of any real estate and personal property Taxes with respect to the Acquired Assets listed in Sections 2.1.1 through 2.1.14 that relate to and accrue during periods after the Applicable Closing, based on an allocation between the number of days in the period before the Applicable Closing and the number of days in the period after the Applicable Closing, notwithstanding when such Taxes are payable or become a lien on the property. Such allocation will be determined based upon the number of days in each respective period divided by the total number of days in both periods.

" Bankruptcy Case " means the case commenced by USA Seller by the filing of a voluntary petition under chapter 11 of the Bankruptcy Code.

" Bankruptcy Code " means 11 U.S.C. § 101 et seq.

" Bankruptcy Court " means the court presiding over the Bankruptcy Case.

" Bankruptcy Proceedings " means the Bankruptcy Case and the Canadian Insolvency Proceeding, collectively.

" Bankruptcy Sale Motion " means the motion in the Bankruptcy Case seeking court approval of this Agreement and the Designation Rights Agreement.

" Bankruptcy Sale Order " means the Bankruptcy Court's order or orders approving the transactions set forth in this Agreement substantially in the form to be attached hereto as Annex B after the preparation thereof and approval thereof by the parties in their respective business judgment, which shall provide, among other things, that (i) other than the USA Assumed Liabilities, the sale of the USA Acquired Assets shall be free and clear of any and all liens, claims, or interests as permitted pursuant to Bankruptcy Code § 363(f), (ii) the sale of the USA Acquired Assets qualifies as a "good faith" sale within the meaning of Bankruptcy Code § 363(m) and (iii) Seller is authorized to enter into and consummate the Designation Rights Agreement and the transactions contemplated thereby.

" Base Amount " means Fifty Two Million Five Hundred Twelve Thousand Five Hundred Dollars ($52,512,500).

" Bifurcated Closing " has the meaning specified in Section 3.1.1 .

" Bill of Sale and Assignment and Assumption Agreement " has the meaning specified in Section 3.3.1 .

" Book Value " means, with respect to any item, the book value thereof as of the Applicable Closing, determined in accordance with GAAP, consistently applied.

" Business " means all operations and conduct in connection with (i) operating the Acquired Stores, (ii) developing, manufacturing or causing the manufacture of, offering for sale and selling merchandise within the Acquired Stores, (iii) warehousing and distributing such merchandise to and among the Acquired Stores, (iv) corporate administration of the foregoing activities, and (v) other comparable activities related to the Acquired Stores. For purposes of clarification, the "Business" does not include any conduct or operations related to or in connection with the USA Remaining Stores or the Canadian 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.

" Business Day " means any day except Saturday, Sunday or any day on which banks in the State of California are permitted to be closed.

" Business Records " has the meaning specified in Section 2.1.8 .

" Business Software " has the meaning specified in Section 2.1.9 .

" Buyer " has the meaning specified in the preamble to this Agreement.

" Canadian Acquired Assets " has the meaning specified in Section 2.1 .

" Canadian Acquired Inventory " has the meaning specified in Section 2.1.3 .

" Canadian Acquired Stores " has the meaning specified in Section 2.1 .

" Canadian Acquired Supplies " has the meaning specified in Section 2.1.5 .

" Canadian Assumed Liabilities " has the meaning specified in Section 2.4 .

" Canadian Buyer " has the meaning specified in the preamble to this Agreement.

" Canadian Cash-On-Hand " has the meaning specified in Section 2.1.11 .

" Canadian Closing " has the meaning specified in Section 3.1.1 .

" Canadian Closing Date " has the meaning specified in Section 3.1.1 .

" Canadian Closing Date Estimate " has the meaning specified in Section 2.7.3(c) .

" Canadian Disney Dollars and Tickets " has the meaning specified in Section 2.1.4 .

" Canadian Dollars/Theme Park Amount " means the total amount paid therefor by Seller (if any) with respect to all Canadian Disney Dollars and Tickets.

" Canadian Estimated Cash-On-Hand " has the meaning specified in Section 2.7.3(b) .

" Canadian Estimated Dollars/Theme Park Amount " has the meaning specified in Section 2.7.3(b) .

" Canadian Estimated Inventory Amount " has the meaning specified in Section 2.7.3(b) .

" Canadian Final Closure Date " has the meaning specified in Section 6.5.2 .

" Canadian Insolvency Court " means the Ontario Superior Court of Justice (Commercial List) in Toronto, Ontario.

" Canadian Insolvency Laws " means the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended, and any order, decree, judgment, rule or regulation made thereunder or in accordance therewith.

" Canadian Insolvency Proceeding " means the voluntary proceeding commenced by Canadian Seller under Canadian Insolvency Laws.

" Canadian Inventory " means all: (i) inventory (excluding any Supplies) that (A) is located in or on the premises of any Canadian Acquired Store (or any storage facility located at or near a Canadian Acquired Store), (B) is located in or on the premises of the Canadian Warehouse or (C) is in transit to the Canadian Acquired Stores from the Canadian Warehouse or in transit from a manufacturer to the Canadian Warehouse; and (ii) all Canadian Retained Stores Inventory.

" Canadian Inventory Amount " has the meaning specified in Section 2.7.3(a) .

" Canadian Petition Date " means the date on which the Canadian Insolvency Proceeding was commenced, which was March 27, 2008.

" Canadian Retained Leases " means any Leases under which the premises of the Canadian Retained Stores (and related storage space, if any) are leased.

" Canadian Retained Stores " means any Stores located in Canada that are not Canadian Acquired Stores, which Canadian Retained Stores are set forth on Annex C by store number, location (by mall name or otherwise), city, state/province and country and such other information as the parties may desire (as such annex may be amended to add any Stores that are removed from the Acquired Stores Schedule pursuant to Section 2.1 or to remove any Stores that are added to the Acquired Stores Schedule pursuant to Section 2.1 ).

" Canadian Retained Stores Dollars and Tickets " has the meaning specified in Section 2.3.5 .

" Canadian Retained Stores Inventory " means all inventory (excluding any Supplies) that (i) is located in or on the premises of any Canadian Retained Store (or any storage facility located at or near a Canadian Retained Store) or (ii) is in transit to the Canadian Retained Stores from the Canadian Warehouse.

" Canadian Retained Stores Supplies " means all Supplies that (i) are located in or on the premises of any Canadian Retained Store (or any storage facility located at or near a Canadian Retained Store) or (ii) are in transit to the Canadian Retained Stores from the Canadian Warehouse.

" Canadian Sale Motion " means the motion in the Canadian Insolvency Court seeking approval of the transactions set forth in this Agreement.

" Canadian Sale Order " means the Canadian Insolvency Court's order or orders approving the transactions set forth in this Agreement, including an order vesting in Canadian Buyer all right, title and interest of Canadian Seller in and to the Canadian Acquired Assets, free and clear of any and all Encumbrances (except the Permitted Encumbrances).

" Canadian Seller " has the meaning specified in the preamble to this Agreement.

" Canadian Supplies " means: (i) all Supplies (A) located in or on the premises of any Canadian Acquired Store (or any storage facility located at or near a Canadian Acquired Store), (B) located in or on the premises of the Canadian Warehouse or (C) in transit to the Canadian Acquired Stores from the Canadian Warehouse or in transit from a manufacturer or other seller thereof to the Canadian Warehouse and (ii) all Canadian Retained Stores Supplies.

" Canadian Warehouse " means the Warehouse located in Canada.

" Canadian Wind-Down Commencement " has the meaning specified in Section 6.5.2 .

" Carrying Costs " has the meaning specified in Section 6.5.1 .

" Cash-On-Hand " means the USA Cash-On-Hand plus, if there is a Canadian Closing, the Canadian Cash-On-Hand.

" Closing Date Estimate " means the sum of the USA Closing Date Estimate plus , if there is a Canadian Closing, the Canadian Closing Date Estimate.

" Closing Date Payments " has the meaning specified in Section 2.7.3(c) .

" COBRA " means the benefit continuation provisions of Section 4980B of the Tax Code and Section 601 et. seq. of ERISA and the related regulations and published interpretations.

" Competition Act " means the Competition Act, R.S.C. 1985, c-34.

" Competition Act Approval " means the receipt of an Advance Ruling Certificate or a no-action letter from the Commissioner of Competition under the Competition Act, on terms acceptable to Buyer.

" Confidential Information " has the meaning specified in Section 8.9 .

" Consent " 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 Seller or TCP Services Co. (including the Acquired Leases and the Headquarters Lease).

" Contract " means any agreement, lease, sublease, license, evidence of debt, mortgage, hypothecation, 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 all amendments, renewals, extensions or other modifications thereof.

" CPA Firm " has the meaning specified in Section 2.8.2 .

" DEI " has the meaning specified in the recitals to this Agreement.

" Designation Rights " has the meaning specified in the Designation Rights Agreement.

" Designation Rights Agreement " means an agreement, by and between USA Seller and USA Buyer, to be dated as of the USA Closing Date, substantially in the form to be attached hereto as Annex D after the preparation thereof and approval thereof by the parties in their respective business judgment.

" Disney Dollars " 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 the Stores and certain venues owned, leased, licensed, controlled and/or operated by DEI or its Affiliates.

" Disney Dollars and Tickets " means the USA Disney Dollars and Tickets and the Canadian Disney Dollars and Tickets.

" Disney Merchandise " has the meaning specified in the License Agreement.

" Disney Store Headquarters " has the meaning specified in Section 2.2 .

" Disney Theme Park Passports " means general admission tickets and passes and other admission media for the entertainment, recreation and lodging complexes located in Anaheim, California, known as DISNEYLAND ^® Resort, and in Orange County and Osceola County, Florida, known as the WALT DISNEY WORLD® Resort, including paper Disney Theme Park Passports used in Canada.

" Dollars/Theme Park Amount " means the USA Dollars/Theme Park Amount plus , if there is a Canadian Closing, the Canadian Dollars/Theme Park Amount.

" Employee Benefit Plan " means (i) any employee benefit plan within the meaning of Section 3(3) of ERISA (regardless of whether or not such plan is subject to ERISA), (ii) 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 any "voluntary employees' beneficiary association" as defined in Section 501(c)(9) of the Tax 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.

" Encumbrance " means any easement, encumbrance, lease, trust or deemed trust, mortgage, security interest, lien, claim, interest, execution, levy, other financial or monetary claim, hypothecation, charge, pledge, or comparable restriction.

" Entire Disney Store Business " means all operations and conduct in connection with (i) operating the Stores (including the Acquired Stores), (ii) developing, manufacturing or causing the manufacture of, offering for sale and selling merchandise within the Stores, (iii) warehousing and distributing such merchandise to and among the Stores, (iv) corporate administration of the foregoing activities, and (v) other comparable activities related to the Stores.

" Entity " means any corporation, partnership, limited partnership, limited liability company, unlimited liability company, trust or other form of legal entity.

" Environmental Requirements " 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.

" ERISA " means the Employee Retirement Income Security Act of 1974, as amended, and the related regulations and published interpretations.

" ERISA Affiliate " means USA Seller, Canadian Seller and all trades or businesses (whether or not incorporated) that are members of a group of which USA Seller or Canadian Seller is a member and that are (i) a "controlled group" within the meaning of Section 414(b) of the Tax Code, (ii) a group "under common control" within the meaning of Section 414(c) of the Tax Code, or (iii) an "affiliated service group" within the meaning of Section 414(m) or (o) of the Tax Code.

" Escrow Agent " means an escrow agent to be selected and mutually agreed upon by Buyer and Seller in their respective business judgment.

" Escrow Agreement " means an Escrow Agreement by and among Buyer, Seller and the Escrow Agent, to be dated as of the USA Closing Date, substantially in the form to be attached hereto as Annex E after the preparation thereof and approval thereof by the parties in their respective business judgment.

" Estimated Cash-On-Hand " means the USA Estimated Cash-On-Hand plus , if there is a Canadian Closing, the Canadian Estimated Cash-On-Hand.

" Estimated Dollars/Theme Park Amount " means the USA Estimated Dollars/Theme Park Amount plus , if there is a Canadian Closing, the Canadian Estimated Dollars/Theme Park Amount.

" Estimated Inventory Amount " means USA Estimated Inventory Amount plus , if there is a Canadian Closing, the Canadian Estimated Inventory Amount.

" Excess Amount " has the meaning specified in Section 2.8.3(c ).

" Existing Environmental Requirements " means those applicable provisions of any Environmental Requirements relating to the Business that are both in effect and required to be met by Seller prior to the Applicable Closing.

" Expiration Date " has the meaning specified in Section 3.1.3 .

" Final Amount " means an amount equal to the sum of the following: (i) the Final Inventory Amount, plus (ii) the Final Dollars/Theme Park Amount, plus (iii) the Final Cash-On-Hand.

" Final Cash-On-Hand " has the meaning specified in Section 2.8.2 .

" Final Dollars/Theme Park Amount " has the meaning specified in Section 2.8.2 .

" Final Inventory Amount " has the meaning specified in Section 2.8.2 .

" Financial Statements " has the meaning specified in Section 4.2 .

" GAAP " means generally accepted accounting principles in the United States or in Canada, as applicable, 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 Seller on a consistent basis prior to the Applicable Closing.

" Governmental Entity " 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, territorial, municipal, or local, domestic or foreign, exercising or purporting to exercise executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, government.

" GST " means goods and services tax or harmonized sales tax imposed under Part IX of the GST Act.

" GST Act " means the Excise Tax Act (Canada).

" Hazardous Substances " 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.

" Headquarters Assets " has the meaning specified in Section 2.2 .

" Headquarters Assets Purchase Price " has the meaning specified in Section 2.7.1 .

" Headquarters Assignment and Assumption Agreement " has the meaning specified in Section 2.2 .

" Headquarters Lease " means the Contract under which the premises of the Disney Store Headquarters are leased to TCP Services Co.

" HSR Act " means the Hart Scott Rodino Antitrust Improvements Act of 1976, as amended.

" Indebtedness " 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 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 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) above.

" Independent Third Party " has the meaning specified in Section 2.6 .

" Information Technology " means hardware, software and/or other technology constituting part of any digital or electronic information system, together with all services and Contracts related thereto.

" Inventory Adjustment Amount " means one of the following:

(i) if the Book Value of the USA Acquired Inventory is less than Seventy Million Three Hundred Fifty Thousand Dollars ($70,350,000), then the "Inventory Adjustment Amount" shall mean a subtraction from the Base Amount equal to the sum of the following: (A) seventy-five percent (75%) of any amount of such shortfall that is over Fifty Eight Million Three Hundred Fifty Thousand Dollars ($58,350,000) and up to Seventy Million Three Hundred Fifty Thousand Dollars ($70,350,000), (B) if applicable, ninety percent (90%) of any amount of such shortfall that is over Fifty Two Million Three Hundred Fifty Thousand Dollars ($52,350,000) and up to and including Fifty Eight Million Three Hundred Fifty Thousand Dollars ($58,350,000) and (C) if applicable, one hundred percent (100%) of any amount of such shortfall that is over the Book Value of the USA Acquired Inventory and up to and including Fifty Two Million Three Hundred Fifty Thousand Dollars ($52,350,000); or

(ii) if the Book Value of the USA Acquired Inventory equals or exceeds Seventy Million Three Hundred Fifty Thousand Dollars ($70,350,000), then the "Inventory Adjustment Amount" shall mean an addition to the Base Amount equal to the sum of the following: (A) seventy-five percent (75%) of any amount of such excess that is over Seventy Million Three Hundred Fifty Thousand Dollars ($70,350,000) and up to Eighty Million Three Hundred Fifty Thousand Dollars ($80,350,000) and (B) if applicable, sixty-five percent (65%) of any amount of such excess that is equal to or greater than Eighty Million Three Hundred Fifty Thousand Dollars ($80,350,000).

" Inventory Adjustment Escrow Amount " has the meaning specified in Section 2.7.2 .

" Inventory Adjustment Escrow Fund " has the meaning specified in Section 2.7.2 .

" Inventory Amount " means the USA Inventory Amount plus , if there is a Canadian Closing, the Canadian Inventory Amount.

" Inventory Report " has the meaning specified in Section 2.6 .

" Investment Canada Act " means the Investment Canada Act, R.S.C. 1985, c-29.

" Investment Canada Act Approval " means approval from the Minister under the Investment Canada Act, on terms acceptable to Buyer.

" IRS " means the Internal Revenue Service or any successor entity.

" Knowledge " 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; provided , that with respect to Seller, "Knowledge" means the actual knowledge of Perry Mandarino and Glenn Reisch.

" Landlord " means the party that, as of the Applicable Closing, holds the landlord's or lessor's interest in a Lease.

" Law " or " Laws " 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.

" Lease " means (i) any Contract pursuant to which any real property is leased to USA Seller or Canadian Seller, including the Acquired Leases, the USA Remaining Leases, the Canadian Retained Leases, and any lease constituting a Retained Asset and (ii) the Headquarters Lease.

" License Agreement " means the License and Conduct of Business Agreement, dated as of November 21, 2004, by and among TDSF, USA Seller (as successor to The Disney Store, LLC, a California limited liability company) and Canadian Seller (as successor to The Disney Store (Canada), Ltd., a corporation incorporated under the laws of the Province of Ontario, Canada), as amended to date.

" Loss " means any and all claims, damages, losses, liabilities, obligations, settlements, injunctions, suits, actions, proceedings, liens, demands, charges, fines, Taxes, 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 reasonable fees and expenses of attorneys and other professionals.

" Material Adverse Event " 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; provided that none of the following events or occurrences, singly or in the aggregate, shall be deemed to constitute a Material Adverse Event: (i) the loss of any employees of the Business, whether arising from or related to the transactions contemplated by this Agreement or otherwise, unless any such losses of employees in the aggregate make it impracticable for Buyer to operate the Acquired Stores or the USA Remaining Stores as determined by Buyer in its business judgment; (ii) subject to Section 3.6.8 , the closure of any Store or Stores or the financial or operational performance of any Store or Stores; (iii) the failure to order inventory subsequent to the order of merchandise for the fall season or the failure to take possession of On-Order Unpaid Merchandise that is not owned by Seller at the time of filing of the Bankruptcy Case unless such merchandise is paid in advance at the time Seller takes possession; (iv) events or conditions affecting TCP or any of its Affiliates other than Seller, provided that such events do not materially adversely affect the Bankruptcy Proceedings or the transactions contemplated by this Agreement; (v) any events generally affecting the economy or world events generally, including terrorist activities or potential or actual military conflicts so long as they do not have a disproportionate effect on the Business in relation to other industry participants; (vi) events generally affecting the industry in which Seller does business so long as they do not have a disproportionate effect on the Business in relation to other industry participants; or (vii) events or conditions arising from the announcement of the transactions contemplated by this Agreement or the Bankruptcy Proceedings.

" Material Acquired Contract " has the meaning specified in Section 4.5.1 .

" Material Contract " means any Contract that is material to the Business or to which Seller is a party, including any such Contracts of the following types: (i) distributor, supplier, vendor and manufacturing Contracts, (ii) marketing or promotional Contracts, (iii) franchise, license, sales, commission, consulting or agency Contracts, (iv) personal property leases, (v) any Contract relating to the sale or disposition of material assets of the Business, (vi) any joint venture Contract or any other Contract involving the sharing of profits, losses, costs or liabilities by Seller with any other Person, (vii) any Contract that relates to any Indebtedness of Seller or any other Person, (viii) any Contract that imposes on Seller an obligation to pay amounts in connection with termination of such Contract and (ix) any Contract that limits Seller's ability to conduct any business or to enter into transactions with third parties. In addition, Material Contracts shall specifically (i) exclude Acquired Leases, USA Remaining Leases, Canadian Retained Leases and the Headquarters Lease, Employee Benefit Plans and the License Agreement and (ii) include all of the Acquired Agreements, the Acquired Car Leases and any other Material Acquired Contracts (other than Acquired Leases, USA Remaining Leases, Canadian Retained Leases, the Headquarters Lease and Employee Benefit Plans).

" Multiemployer Plan " means any "multiemployer plan" as defined in Section 4001(a)(3) of ERISA that is (or was) subject to Title IV of ERISA.

" Mutual Release " has the meaning specified in the recitals to this Agreement.

" On-Order Unpaid Merchandise " means all Disney Merchandise that has been ordered by Seller for sale through the Stores but that has not yet been received by and is not in the possession of Seller or its Affiliates and has not yet been paid for by Seller or its Affiliates (whether in cash, by issuance of a trade letter of credit or by other means), wherever located and in whatever stage of development, but specifically excluding the Acquired Inventory. A detailed listing of the On-Order Unpaid Merchandise has been made available to Buyer.

" Original Sale Date " means November 21, 2004.

" Other Store Employees " has the meaning specified in Section 6.4.1 .

" Outstanding Royalty Amounts " has the meaning specified in Section 2.9.

" Permits " means any approval, authorization, consent, qualification, registration, license, permit, franchise, certificate of authority or order, or any waiver of the foregoing, including Investment Canada Act Approval and Competition Act Approval, 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.

" Permitted Encumbrance " means (i) any Encumbrance that is a lease for personal property and is reflected on Seller Schedule 1.1(a) or entered into in the ordinary course of business or (ii) easements, rights-of-way, restrictions and other similar charges or Encumbrances on real property, in each case that do not materially detract from the value of Seller'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.

" Person " means any natural person or Entity.

" Prime Rate " 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.

" Private Sale " means a sale in the Bankruptcy Proceedings that is to be approved on notice and hearing that is not subject to any auction, overbidding, or shopping; provided, however, that, if notwithstanding Seller's commercially reasonable efforts to achieve a sale on such terms, a court shall order a sale by auction, overbidding, shopping or other form of public sale, then "Private Sale" shall include such sale in the form and manner as ordered by the court.

" Related Agreements " means the Bill of Sale and Assignment and Assumption Agreement, Designation Rights Agreement, the Escrow Agreement, the Headquarters Assignment and Assumption Agreement, the Mutual Release, the Release Agreement, the Support Agreement and the Transitional Services Agreement.

" Release Agreement " has the meaning specified in Section 8.19 .

" Representatives " 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.

" Retained Assets " has the meaning specified in Section 2.3 .

" Retained Employees " means all employees of Seller, TCP and their respective Affiliates, including all employees of the Entire Disney Store Business, but excluding the Transferred Employees.

" Retained Liabilities " has the meaning specified in Section 2.5 .

" Sale Motions " has the meaning specified in Section 3.2

" Sale Orders " means the Bankruptcy Sale Order and the Canadian Insolvency Sale Order, collectively.

" Securities " means any and all debt and equity securities and other ownership interests in whatever form, including 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 any securities, warrants, options or rights convertible into or exercisable for any of the foregoing.

" Seller " has the meaning specified in the preamble to this Agreement.

" Seller Information Technology " means any Information Technology included in the Acquired Assets.

" Seller Only Taxes " has the meaning specified in Section 6.1.1 .

" Seller Schedules " means those certain disclosure schedules in final form that have been separately delivered by Seller to Buyer not later than five (5) Business Days after the date of execution of this Agreement.

" Severance Escrow Amount " has the meaning specified in Section 2.7.2 .

" Severance Escrow Expiration Date " means the date that is ninety (90) days following the earlier to occur of the Expiration Date and the Canadian Closing, provided that, upon Buyer's reasonable request made in writing to Seller at any time prior to the Severance Escrow Expiration Date, the Severance Escrow Expiration Date will be extended by an additional ninety (90) days for a total of one hundred eighty (180) days.

" Severance Escrow Fund " has the meaning specified in Section 2.7.2 .

" Severance Fund Election " has the meaning specified in Section 2.7.2 .

" Stores " means the specialty retail stores operated by Seller under the " Disney Store " name on the date of this Agreement. For purposes of clarification, the Stores include the Acquired Stores, the USA Remaining Stores and the Canadian Retained Stores.

" Store Closing Sales " has the meaning specified in Section 6.5.1 .

" Subsidiaries ", 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.

" Supplies " means all supplies used in the Stores but not offered for sale in the Stores to the public, including bags, register tapes and hangers.

" Support Agreement " has the meaning specified in the recitals to this Agreement.

" Tax " or " Taxes " means (i) any and all federal, state, provincial, territorial, local, municipal and foreign taxes, assessments and other governmental charges, duties, impositions, levies, fees, surtaxes, withholdings, dues 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, GST, consumption, anti-dumping, countervail, net worth, stamp, registration, education, business, school, local improvement, development, 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 Canadian Seller, Canada Pension Plan and provincial pension plan contributions, employment and unemployment insurance contributions and premiums, worker's compensation and deductions at source, together, in each case, with all interest, penalties and additions imposed with respect to such amounts; (ii) any liability for the payment of any amounts of the type described in subparagraph (i) as a result of being a member of an affiliated, consolidated, combined or unitary group for any period (including pursuant to Section 1.1502-6 of the Treasury Regulations or comparable provision of state, provincial, local or foreign Tax law); and (iii) any liability for the payments of the amounts of the types described in subparagraph (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 including any obligations under any agreements or arrangements with any person with respect to the liability for, or sharing of, Taxes (other than an indemnification obligation arising under this Agreement).

" Tax Code " means the Internal Revenue Code of 1986, as amended.

" Tax Escrow Expiration Date " means the date that is nine (9) months after the USA Closing (or, in the case of a Bifurcated Closing, the Canadian Closing, if applicable).

" Tax Proceeding " has the meaning specified in Section 6.1.2.

" Tax Return " 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.

" TCP " has the meaning specified in the recitals to this Agreement .

" TCP Services Co. " has the meaning specified in the preamble to this Agreement.

" TDSF " means TDS Franchising, LLC, a California limited liability company.

" Transaction Taxes " has the meaning specified in Section 6.1.1 .

" Transaction Taxes Escrow Amount " has the meaning specified in Section 2.7.2 .

" Transaction Taxes Escrow Fund " has the meaning specified in Section 2.7.2 .

" Transfer " means any issuance, sale, transfer, assignment, subletting, licensing, 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 pledged assets in complete or partial satisfaction of the indebtedness for which such assets are security.

" Transferred Employees " has the meaning specified in Section 6.4.1 .

" Transferred Employee Severance Costs " has the meaning specified in Section 6.4.2(a) .

" Transitional Services Agreement " means a Transitional Services Agreement to be dated as of the USA Closing Date and entered into by and between Buyer and TCP Services Co., substantially in the form to be attached hereto as Annex F after the preparation thereof and approval thereof by Buyer and TCP Services Co. as contemplated by Section 6.8 .

" USA Acquired Assets " has the meaning specified in Section 2.1 .

" USA Acquired Inventory " has the meaning specified in Section 2.1.3 .

" USA Acquired Stores " has the meaning specified in Section 2.1 .

" USA Acquired Supplies " has the meaning specified in Section 2.1.5 .

" USA Assumed Liabilities " has the meaning specified in Section 2.4 .

" USA Buyer " has the meaning specified in the preamble to this Agreement.

" USA Cash-On-Hand " has the meaning specified in Section 2.1.11 .

" USA Closing " has the meaning specified in Section 3.1.1 .

" USA Closing Date " has the meaning specified in Section 3.1.1 .

" USA Closing Date Estimate " has the meaning specified in Section 2.7.3(c) .

" USA Disney Dollars and Tickets " has the meaning specified in Section 2.1.4 .

" USA Dollars/Theme Park Amount " means the total amount paid therefor by Seller (if any) with respect to all USA Disney Dollars and Tickets.

" USA Estimated Dollars/Theme Park Amount " has the meaning specified in Section 2.7.3(b) .

" USA Estimated Cash-On-Hand " has the meaning specified in Section 2.7.3(b) .

" USA Estimated Inventory Amount " has the meaning specified in Section 2.7.3(b) .

" USA Inventory " means all inventory (excluding any Supplies), other than Canadian Inventory, consisting of the following: (i) all inventory (including Disney Merchandise) that is in the possession of Seller, wherever located and in whatever stage of development, including any such inventory that is located in or on the premises of any Store (or any storage facility located at or near a Store), located in or on the premises of any USA Warehouse, in transit to the Stores from a USA Warehouse or in transit from a manufacturer to a USA Warehouse, and (ii) all inventory (including Disney Merchandise) other than any inventory described in subparagraph (i), that has been paid for by Seller (whether in cash, by issuance of a trade letter of credit or by other means), wherever located and in whatever stage of development, including any such inventory that is in the possession of a manufacturer, whether in the form of raw materials and supplies, goods in process or finished goods, or in transit from a manufacturer to a USA Warehouse.

" USA Inventory Amount " has the meaning specified in Section 2.7.3(a) .

" USA Petition Date " means the date on which the Bankruptcy Case was commenced, which was March 26, 2008.

" USA Remaining Leases " means any Leases under which premises of the USA Remaining Stores (and related storage space, if any) are leased.

" USA Remaining Stores " means any Stores located in the United States that are not USA Acquired Stores, which USA Remaining Stores are set forth on Annex G by store number, location (by mall name or otherwise), city, state/province and country and such other information as the parties may desire (as such annex may be amended to add any Stores that are removed from the Acquired Stores Schedule pursuant to Section 2.1 or to remove any Stores that are added to the Acquired Stores Schedule pursuant to Section 2.1 ).

" USA Seller " has the meaning specified in the preamble to this Agreement.

" USA Supplies " means all Supplies, other than Canadian Supplies, consisting of the following: (i) all Supplies that are in the possession of Seller, wherever located, including any Supplies that are located in or on the premises of any Store (or any storage facility located at or near a Store), located in or on the premises of any USA Warehouse, in transit to the Stores from a USA Warehouse or in transit from a manufacturer or other seller thereof to a USA Warehouse, and (ii) all Supplies, other than any Supplies described in subparagraph (i), that have been paid for by Seller (whether in cash, by issuance of a trade letter of credit or by other means), wherever located, including any Supplies that are in the possession of a manufacturer or other seller thereof or in transit from a manufacturer or other seller thereof to a USA Warehouse.

" USA Warehouses " means all Warehouses other than the Canadian Warehouse.

" Warehouses " has the meaning specified in Section 2.3.1 .

" Wind-down Period " has the meaning specified in Section 6.5.1 .

1.2 Interpretation . 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, restatements, renewals, extensions and replacements; (iv) 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) 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) 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) references herein to "Dollars" or "$" shall mean United States dollars unless otherwise specifically stated; and (ix) 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.

ARTICLE II

PURCHASE AND SALE OF ASSETS

2.1 Acquired Assets . On the terms and subject to the conditions set forth in this Agreement (i) at the USA Closing, USA Seller shall, in accordance with the Bankruptcy Sale Order and pursuant to sections 363 and 365 of the Bankruptcy Code, assume and assign to USA Buyer, and USA Buyer shall acquire, (A) those Stores set forth and listed on Part 1 of Annex A hereto (the " USA Acquired Stores "), and (B) all of USA Seller's rights, title, and interest in each of its executory contracts, assets, properties, operations and businesses and other rights and privileges directly used in connection with or related to the USA Acquired Stores and, to the extent set forth below in subparagraphs 2.1.1 through 2.1.14 , the USA Remaining Stores (subparagraphs (A) and (B), collectively, the " USA Acquired Assets "), and (ii) at the Canadian Closing, Canadian Seller shall, in accordance with the Canadian Sale Order and pursuant to Canadian Insolvency Laws, sell, convey, assign, transfer and deliver to Canadian Buyer, and Canadian Buyer shall acquire, (A) those Stores set forth and listed on Part 2 of Annex A hereto (the " Canadian Acquired Stores "), and (B) all of Canadian Seller's rights, title, and interest in each of its executory contracts, assets, properties, operations and businesses and other rights and privileges directly used in connection with or related to the Canadian Acquired Stores (subparagraphs (A) and (B) collectively, the " Canadian Acquired Assets ," and together with the USA Acquired Assets and the Headquarters Assets, collectively, the " Acquired Assets "), including Seller's right, title and interest in:

2.1.1 the Acquired Leases (and no other real property leases, except as may be otherwise provided in the Designation Rights Agreement);

2.1.2 all furniture, fixtures, equipment and other tangible personal property in all Stores (other than the Canadian Retained Stores), including machinery, computers, cash registers, tools, parts, supplies and motor vehicles, subject to Permitted Encumbrances;

2.1.3 all (i) USA Inventory in existence as of the USA Closing Date (the " USA Acquired Inventory ") and (ii) Canadian Inventory, other than any Canadian Retained Stores Inventory, in existence as of the Canadian Closing Date (the " Canadian Acquired Inventory ");

2.1.4 all (i) Disney Dollars and Disney Theme Park Passports held for sale by Seller as of the USA Closing Date in or with respect to the Stores other than the Canadian Retained Stores, the Canadian Acquired Stores and the Canadian Warehouse (the " USA Disney Dollars and Tickets ") and (ii) the Disney Dollars and Disney Theme Park Passports held for sale by Seller as of the Canadian Closing Date in or with respect to the Canadian Acquired Stores and the Canadian Warehouse (the " Canadian Disney Dollars and Tickets " );

2.1.5 all (i) USA Supplies in existence as of the USA Closing Date (the " USA Acquired Supplies ") and (ii) Canadian Supplies, other than any Canadian Retained Stores Supplies, in existence as of the Canadian Closing Date (the " Canadian Acquired Supplies ");

2.1.6 all Contracts listed on Annex H , which annex will be prepared by Buyer after the date of this Agreement and will be attached hereto (the " Acquired Agreements ") (provided that Seller shall have the right to maintain copies thereof to the extent required by Law or Seller's existing recordkeeping policies), but no other Contracts (other than the Acquired Leases and the Acquired Car Leases);

2.1.7 all Permits, and all pending applications therefor or renewals thereof, in each case to the extent transferable, relating to the use or operation of all of the Stores (other than the Canadian Retained Stores) and the Acquired Assets;

2.1.8 all data, manuals, files, computer tapes, databases, correspondence, lists and other books and records for the Entire Disney Store Business to the extent not related exclusively to TCP or its Affiliates other than Seller, including client and customer lists and records, price lists or pricing structures, research and development reports and records, production reports and records, product designs and drawings, operating guides and manuals, financial and accounting records, plans, budgets, forecasts and projections, creative materials, advertising materials, promotional materials, studies, reports, correspondence and other similar documents and records but, with respect to personnel records, only length of service information and not other personnel records (the " Business Records ") (provided that Seller shall have the right to maintain copies thereof to the extent required by law or Seller's existing recordkeeping policies and (i) to the extent any such materials (other than client and customer lists and records) are required for the operation of TCP's business (other than the Business) and (ii) in the case of a Bifurcated Closing, to the extent such materials are required for the operation of the Stores located in Canada until the Canadian Final Closure Date);

2.1.9 all intellectual, proprietary and intangible rights and property related to the Entire Disney Store Business, in any and all media, anywhere in the world, including, (i) going concern value, (ii) goodwill, (iii) telephone, telecopy, internet and e-mail addresses, listings websites and domain names, (iv) names, trade names, trademarks, service marks, trade dress, logos, slogans, symbols and emblems, in each case including all registrations, applications for registration and common law rights and all goodwill associated therewith, (v) all patents and patent applications, (vi) all computer software (including source code, object code, user interfaces, templates, menus and related technology) that is used primarily in connection with the Entire Disney Store Business and not primarily used by TCP or any Affiliate thereof in connection with any business other than the Entire Disney Store Business (and specifically excluding the SAS/Market Max software) (the " Business Software "), subject to obtaining, at no cost to Seller or its Affiliates, any required third party Consent and provided that Buyer acknowledges that a material amount of the Business Software may be subject to "umbrella" license agreements granted to TCP or TCP Services Co. for itself and its Affiliates, such that Seller is entitled to use such Business Software in the Entire Disney Store Business only in its capacity as an Affiliate of TCP or TCP Services Co., and, in such situations, although the parties will use good faith efforts (without incurring material fees or expenses to the licensor) to transfer rights in such Business Software to Buyer, if such transfer is not possible through such efforts, then such Business Software will not be transferred to Buyer but Buyer's needs for such Business Software will be addressed in a commercially reasonable and mutually approved manner through the Transitional Services Agreement until such time as Buyer is able to make arrangements for replacement software, (vii) all works of authorship (whether or not copyrightable) and all registered and unregistered copyrights (whether in published or unpublished works), excluding copyrights in software that is not Business Software, (viii) all ideas, inventions, know-how, trade secrets, confidential or proprietary information, techniques, processes, plans, designs, concepts, works in progress, drawings and blue prints, (ix) moral rights and rights of attribution and integrity, (x) all licenses and assignments of any kind relating to any of the foregoing, and (xi) all documentation and tangible embodiments of or relating to any of the foregoing, in each case relating to the operation of the Entire Disney Store Business;

2.1.10 the leases for cars that are leased by Seller and set forth on Annex I , which annex will be prepared by Buyer after the date of this Agreement and will be attached hereto (the " Acquired Car Leases "), but no other leases for cars;

2.1.11 (i) all cash-on-hand in the USA Acquired Stores and USA Remaining Stores as of the USA Closing (the " USA Cash-On-Hand ") and (ii) all cash-on-hand in the Canadian Acquired Stores as of the Canadian Closing (" Canadian Cash-On-Hand ");

2.1.12 all claims (other than Tax claims) against third parties (other than TCP or its Affiliates) from or related to the use or operation of the Acquired Assets;

2.1.13 subject to Section 6.7 , all rights relating to deposits, prepaid rent and other prepaid expenses, claims for refunds and rights to offset in respect thereof related to the Acquired Assets; and

2.1.14 the Internet Store (as defined in the License Agreement) (which is currently operated by certain Affiliates of TDSF and currently occupies a portion of the website owned by certain Affiliates of TDSF located at www.disneyshopping.com) and the properties, assets, businesses and operations relating thereto, but specifically excluding any Warehouses.

Notwithstanding the foregoing:

(i) If, at any time prior to the Applicable Closing, with respect to any Store set forth on the Acquired Stores Schedule, Buyer discovers (through its due diligence investigation, Landlord negotiations or otherwise) that: (A) such Store is no longer operating in the ordinary course of business, consistent with the past practice of such Store, other than as a result of the failure to order or replenish inventory, (B) there is, prior to the Applicable Petition Date, either (x) outstanding unpaid rent under the Lease relating to such Store that is forty-five (45) days or more past due or (y) outstanding unpaid rent or other unpaid occupancy-related expenses or other amounts due (other than year-end adjustments) under the Lease relating to such Store that are in excess of an aggregate of $30,000 that would be required to be assumed or cured by Buyer if the Store were an Acquired Store, (C) one-third (1/3) or more of the management employees for such Store have resigned, been terminated or been reassigned to another position (whether within such Store, to another Store or otherwise) and have not been replaced by qualified individuals in accordance with the Seller's past and customary management employee hiring and replacement procedures, (D) there are outstanding remodel obligations for such Store that have been agreed to with the Landlord thereof and/or other outstanding repair, maintenance or remodel requirements or obligations for such Store that, in the aggregate, exceed One Hundred Thousand Dollars ($100,000), (E) the sales for such Store for the March 2008 retail month have decreased as compared with the sales for such Store for the January 2008 retail month, provided that this subparagraph (E) shall not apply to any Store that was opened after October 31, 2007, any Store for which a remodel was completed on or after October 31, 2007, or any Store that is undergoing a substantial remodel as of the Applicable Petition Date, (F) the actual sales or operating income for such Store for the March 2008 retail month are less than Seller's forecast for such Store for the March 2008 retail month by fifteen percent (15%) or more, provided that this subparagraph (F) shall not apply to any Store that was opened after October 31, 2007, any Store for which a remodel was completed on or after October 31, 2007, or any Store that is undergoing a substantial remodel as of the Applicable Petition Date, and/or (G) either the book value of the inventory in such Store, or the number of units of inventory in such Store, measured as of the date that is three (3) Business Days prior to the Applicable Closing Date, has decreased by more than thirty percent (30%) from the book value of the inventory or the number of units of inventory in such Store, respectively, measured as of March 1, 2008, then , Buyer may, at any time prior to the Applicable Closing, at its option and in its sole discretion, determine that such Store shall be deleted from the Acquired Stores Schedule. If Buyer determines that any Store shall be deleted from the Acquired Stores Schedule, then (I) Buyer shall provide written notice of such deletion to Seller, (II) the Acquired Stores Schedule shall, upon such notice, be automatically amended to delete any such Store therefrom and (III) such Store shall not be included in the Acquired Assets, shall not constitute an Acquired Store and the Lease therefor shall not constitute an Acquired Lease, and instead such Store shall be included in the USA Remaining Stores (if such Store is located in the United States) or the Canadian Retained Stores (if such Store is located in Canada), and the Lease therefor shall constitute a USA Remaining Lease (if such Lease is for a Store located in the United States), or a Canadian Retained Lease (if such Lease is for a Store located in Canada), in each case, for all purposes of this Agreement.

(ii) At any time prior to the Applicable Closing, Buyer may elect, in its sole discretion by providing written notice to Seller, to add any Store to the Acquired Stores Schedule, in which event the Acquired Stores Schedule shall, upon such notice, be automatically amended to add any such Store thereto and such Store shall no longer constitute a USA Remaining Store or a Canadian Retained Store, as applicable, and the Lease therefor shall no longer constitute a USA Remaining Lease or a Canadian Retained Lease, as applicable, and instead such Store shall be included in the Acquired Stores, and the Lease therefor shall constitute an Acquired Lease, in each case, for all purposes of this Agreement; provided, however, that, in addition to Buyer's Store removal rights under the preceding subparagraph (i), if any addition of a Store under this subparagraph (ii) results in there being more than Two Hundred Twenty (220) Acquired Stores on the Acquired Stores Schedule, then Buyer may, from time to time, prior to the Applicable Closing, in its sole discretion and without specifying any reason (including not specifying any reason set forth in the preceding subparagraph (i)), by providing written notice to Seller, remove any one or more of the Acquired Stores from the Acquired Stores Schedule up to a number of removed Acquired Stores that would result in the total number of Acquired Stores not exceeding Two Hundred Twenty (220), in which event the Acquired Stores Schedule shall, upon such notice, be automatically amended to remove such Store or Stores and such Store or Stores shall not be included in the Acquired Assets, shall not constitute Acquired Store(s) and the Lease(s) therefor shall not constitute Acquired Lease(s), and instead such Store or Stores shall be included in the USA Remaining Stores (if such Stores are located in the United States) or Canadian Retained Stores (if such Stores are located in Canada), and the Lease(s) therefor shall constitute USA Remaining Lease(s) (if such Stores are located in the United States) or Canadian Retained Leases (if such Stores are located in Canada), in each case, for all purposes of this Agreement.

(iii) If at any time prior to the Applicable Closing, Buyer, at its option and in its sole discretion, determines not to assume any of the Acquired Agreements on Annex H or the Acquired Car Leases on Annex I , then Buyer shall, at any time prior to the Applicable Closing, provide written notice thereof to Seller, and upon any such notice (A) Annex H or Annex I , as applicable, shall automatically be amended to delete any such Contract therefrom and (B) any such Contract shall not constitute an Acquired Agreement or an Acquired Car Lease (as applicable), and therefore shall not constitute an Acquired Asset (and the liabilities relating thereto shall not constitute Assumed Liabilities), and shall instead constitute a Retained Asset (and the liabilities relating thereto shall constitute Retained Liabilities), in each case, for all purposes of this Agreement.

(iv) Buyer hereby agrees that, with respect to the Lease for any Acquired Store (after taking into account any amendments to the Acquired Stores Schedule pursuant to this Section 2.1) , prior to the Applicable Closing, Buyer shall not terminate the existing Lease for such Acquired Store or renegotiate a new Lease with the Landlord thereof (and shall instead assume such Lease, either as it exists or with modifications agreed to between Buyer and the Landlord thereof), unless in connection with any such termination, the Landlord releases Seller from all liabilities and obligations under such Lease.

2.2 Headquarters Office . On the terms and subject to the conditions set forth in this Agreement, at the USA Closing, TCP Services Co. shall, and hereby agrees to, sell, convey, assign, transfer and deliver to USA Buyer its interests in the headquarters office located at 443 S. Raymond Avenue, Pasadena, California (the " Disney Store Headquarters "), together with all assets relating specifically thereto, including the Headquarters Lease, deposits and prepaid expenses, furniture, fixtures, equipment, and supplies and Information Technology located therein and owned, leased or licensed by Seller on the USA Closing Date (collectively, the " Headquarters Assets "), pursuant to an Assignment and Assumption Agreement, by and between TCP Services Co. and USA Buyer, to be dated as of the USA Closing Date, substantially in the form to be attached hereto as Annex J after the preparation thereof and approval thereof by the parties in their respective business judgment (the " Headquarters Assignment and Assumption Agreement ").

2.3 Retained Assets . Notwithstanding anything to the contrary contained in this Agreement or in any other agreement or instrument, and other than as provided in the Headquarters Assignment and Assumption Agreement and the Designation Rights Agreement, Seller shall not sell, assign, transfer, convey or deliver to Buyer, and Buyer shall neither purchase nor acquire from Seller or its Affiliates, any of the following assets (collectively, the " Retained Assets "):

2.3.1 any warehouse facility used by Seller in connection with the Entire Disney Store Business (collectively, the " Warehouses ") and the assets relating specifically thereto, including Contracts, deposits and prepaid expenses, insurance policies, furniture, fixtures, equipment, supplies and Information Technology located in the Warehouses on the Applicable Closing Date, but excluding the Acquired Inventory, Acquired Supplies and Disney Dollars and Tickets located in the Warehouses;

2.3.2 the Canadian Retained Stores and all furniture, fixtures, equipment and other tangible personal property in the Canadian Retained Stores, including machinery, computers, cash registers, tools, parts, supplies and motor vehicles;

2.3.3 Canadian Retained Stores Inventory as of the Canadian Closing;

2.3.4 Canadian Retained Stores Supplies as of the Canadian Closing;

2.3.5 Disney Dollars and Disney Theme Park Passports held for sale by Seller as of the Canadian Closing in or with respect to the Canadian Retained Stores (and specifically excluding Disney Dollars and Tickets) (" Canadian Retained Stores Dollars and Tickets ");

2.3.6 any office space used by Seller in connection with the Entire Disney Store Business and the assets relating specifically thereto, including any Contracts, deposits and prepaid expenses, insurance policies, and furniture, fixtures, equipment, supplies and Information Technology located therein on the Applicable Closing Date, other than the Headquarters Assets as provided in Section 2.2 and the Headquarters Assignment and Assumption Agreement;

2.3.7 all accounts receivable;

2.3.8 all rights to refunds of Taxes for periods prior to the Applicable Closing (whether actually refunded or applied as a credit against future Tax liabilities), which, if paid or credited to Buyer, shall promptly be paid by Buyer to Seller, and all Tax benefits resulting from losses incurred by Seller and its Affiliates before the Applicable Closing;

2.3.9 all rights in software, other than the Business Software;

2.3.10 all cash and cash equivalents, other than Cash-on-Hand; and

2.3.11 except as may otherwise be provided in the Designation Rights Agreement, any other assets, properties, operations or businesses of TCP, Seller or their Affiliates other than the Acquired Assets.

2.4 Assumed Liabilities . Buyer shall assume the following liabilities of Seller and its Affiliates, and no others (collectively, the " Assumed Liabilities "), with USA Buyer assuming the following Assumed Liabilities that relate to the USA Acquired Assets (such Assumed Liabilities, the " USA Assumed Liabilities "), and Canadian Buyer assuming the following Assumed Liabilities that relate to the Canadian Acquired Assets (such Assumed Liabilities, the " Canadian Assumed Liabilities "):

2.4.1 all liabilities relating to the Acquired Assets listed in Sections 2.1.1 through 2.1.14 to the extent arising after the Applicable Closing, including any such liabilities arising under the Acquired Leases, the Acquired Car Leases and the Acquired Agreements and any Assumed Real Estate Taxes;

2.4.2 all amounts necessary to cure any arrearages prior to the Applicable Petition Date under the Acquired Car Leases, the Acquired Agreements and the Acquired Leases, but specifically excluding (i) any monthly rents and other amounts for the period from the Applicable Petition Date to the Applicable Closing, which shall be Retained Liabilities and which shall be paid by Seller when due and (ii) any intercompany liabilities arising between Seller and TCP or its Affiliates, whether arising before or after the Applicable Petition Date, which shall be Retained Liabilities;

2.4.3 all obligations to honor, as a means of payment in the Stores (other than the Canadian Retained Stores), outstanding Disney-branded Gift Cards (as defined in the License Agreement) and Disney Dollars sold by Seller to consumers prior to the Applicable Closing Date; and

2.4.4 the Carrying Costs, as provided in Section 6.5.1 and, if applicable, Section 6.5.4 .

For purposes of clarification, the Assumed Liabilities shall specifically exclude any accounts payable of Seller, all of which shall be Retained Liabilities. Other than the Assumed Liabilities and the Permitted Encumbrances, the sale of the Acquired Assets to Buyer shall be free and clear of any and all liens, claims, interests or Encumbrances pursuant to Bankruptcy Code § 363(f) and the Canadian Sale Order.

In addition, with respect to any Acquired Car Leases, Acquired Agreements and Acquired Leases for which Seller or its Affiliates have provided a letter of credit, to the extent necessary, upon the assumption thereof or as soon as reasonably practicable thereafter, Buyer shall provide a replacement letter of credit therefor.

2.5 Retained Liabilities . Notwithstanding anything to the contrary contained in this Agreement or in any other agreement or instrument, other than as provided in the Headquarters Assignment and Assumption Agreement and other than the Assumed Liabilities, Buyer shall not assume or be liable with respect to any liability or obligation of Seller or its Affiliates of whatever nature (collectively, the " Retained Liabilities "), and Seller and its Affiliates, as applicable, shall remain solely responsible and liable for all Retained Liabilities, including any liability or obligation of Seller or its Affiliates relating to or arising from the following:

2.5.1 any Leases, including Canadian Retained Leases, other than the Acquired Leases;

2.5.2 any arrearages of Seller, including any arrearages relating to Canadian Retained Leases, other than those specifically set forth in Section 2.4.2 ;

2.5.3 any and all Taxes, whether imposed by Contract, Law or otherwise, other than as set forth in Section 6.1 and the Assumed Real Estate Taxes;

2.5.4 other than as set forth below in Section 6.4.2(b) with respect to the Transferred Employees, any and all employee obligations, including salary, bonus, equity, payroll taxes, benefits arising under Employee Benefit Plans, severance, accrued vacation, COBRA obligations and Contracts;

2.5.5 any escheat liability relating to Seller's operations;

2.5.6 all accounts payable, intercompany debt (including any intercompany debt between Seller and TCP or its Affiliates) and other liabilities;

2.5.7 any monthly rents and other amounts for the period from the Applicable Petition Date to the Applicable Closing (which amounts shall be paid by Seller when due);

2.5.8 any Retained Asset (including the Canadian Retained Stores), including any liability or obligation arising out of a claim by any party to any Contract that does not constitute an Acquired Asset arising out of the determination not to transfer such Contract;

2.5.9 any Action arising against Seller at any time; provided , however , that, with respect to any Action relating to or arising out of the Acquired Assets or the USA Remaining Stores, the Retained Liabilities shall only include such Actions that relate to the operation of the Acquired Assets or the USA Remaining Stores prior to the Applicable Closing; and

2.5.10 any claim or assertion that Buyer has transferee liability (other than for the Assumed Liabilities) or successor liability, including for any Tax claims or Actions, whether such claims or Actions are made by any Taxing authority where Seller currently files Tax Returns or by any other Taxing authority in any other jurisdiction (whether located in the United States, Canada, or any other country).

2.6 Inventory Count . The parties agree that prior to the USA Closing, they shall engage an independent third party that is in the business of conducting physical inventory counts, to be mutually agreed upon by Buyer and Seller (the " Independent Third Party "), to conduct a physical inventory of (i) the USA Acquired Inventory as of the USA Closing and (ii) the Canadian Acquired Inventory as of the Canadian Closing (if there is a Canadian Closing). Seller and Buyer shall each pay one half (1/2) of the fees of such Independent Third Party for each of the foregoing physical inventories. Such Independent Third Party shall deliver to Buyer and Seller a written inventory report, describing the quantity of the USA Acquired Inventory and, if there is a Canadian Closing, then the Canadian Acquired Inventory (such reports, the " Inventory Report "), as promptly as possible following the Applicable Closing, but in no event later than five (5) Business Days following the Applicable Closing Date .

2.7 Purchase Price; Payments at Closing .

2.7.1 Purchase Price for Headquarters Assets and Closing Payment for Headquarters Assets . The Purchase Price payable to TCP Services Co. for the Headquarters Assets shall be an amount equal to Four Million Dollars ($4,000,000) (the " Headquarters Assets Purchase Price "). At the USA Closing, Buyer shall pay to TCP Services Co. an amount equal to the Headquarters Assets Purchase Price, which shall be apportioned between TCP Services Co. and Seller in the manner, and shall be paid to the accounts, specified in written instructions provided to Buyer by TCP Services Co. at least two (2) Business Days prior to the USA Closing.

2.7.2 Deposit by Buyer into Escrow . At the USA Closing, (i) Seller and Buyer shall execute and deliver to each other and the Escrow Agent the Escrow Agreement and (ii) Buyer shall deliver to the Escrow Agent the following amounts: (A) Six Million Dollars ($6,000,000) (the " Inventory Adjustment Escrow Amount ," which amount, together with all interest or any other earnings or income generated on or in respect of the foregoing funds or any proceeds therefrom shall constitute the " Inventory Adjustment Escrow Fund "), (B) Five Hundred Thousand Dollars ($500,000) (the " Transaction Taxes Escrow Amount ," which together with all interest or any other earnings or income generated on or in respect of the foregoing funds or any proceeds therefrom shall constitute the " Transaction Taxes Escrow Fund "), and (C) One Million Dollars ($1,000,000) (the " Severance Escrow Amount ," which amount, together with all interest or any other earnings or income generated on or in respect of the foregoing funds or any proceeds therefrom shall constitute the " Severance Escrow Fund "); provided, that, at the election of Canadian Seller in its sole discretion, to be made by providing written notice to Buyer at least five (5) Business Days prior to the USA Closing, the Severance Escrow Amount may be paid and delivered by Canadian Seller, rather than Buyer, to the Escrow Agent (such election, if made and if the Severance Escrow Amount is actually paid and delivered by Canadian Seller, the " Severance Fund Election "). The Escrow Agreement shall provide for the Inventory Adjustment Escrow Fund, the Transaction Taxes Escrow Fund and the Severance Escrow Fund to be held by the Escrow Agent in accordance with the terms thereof (which, among other things, shall provide for the expiration of the Inventory Adjustment Escrow Fund following the completion of all procedures and the payment of all amounts due under Section 2.8 , the expiration of the Transaction Taxes Escrow Fund on the Tax Escrow Expiration Date and the expiration of the Severance Escrow Fund on the Severance Escrow Expiration Date).

2.7.3 Purchase Price for Acquired Assets Other than Headquarters Assets; Delivery of Seller Estimates; Additional Closing Payments .

(a) Purchase Price for Acquired Assets Other than Headquarters Assets . The purchase price for (i) the USA Acquired Assets shall equal the following: (x) the Base Amount, as adjusted pursuant to the Inventory Adjustment Amount as of the USA Closing (the " USA Inventory Amount "), plus (y) the USA Dollars/Theme Park Amount, plus (z) the USA Cash-On-Hand, and (ii) the Canadian Acquired Assets shall equal the following: (x) the Book Value of the Canadian Acquired Inventory as of the Canadian Closing, multiplied by 0.75 (the " Canadian Inventory Amount "), plus (y) the Canadian Dollars/Theme Park Amount, plus (z) the Canadian Cash-On-Hand. Such purchase price for the USA Acquired Assets and the Canadian Acquired Assets will be paid by Buyer to Seller in accordance with Sections 2.7.3(c) and 2.8 and will be subject to adjustment, as applicable, pursuant to Section 2.8 .

(b) Delivery of Seller Estimates .

(i) USA Closing . At least two (2) Business Days prior to the USA Closing Date, Seller shall

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