TERM LOAN CREDIT AGREEMENT

Exhibit 10.20

This instrument and the rights and obligations evidenced hereby, the liens and security interests securing the indebtedness and other obligations incurred or arising under or evidenced by this instrument and the rights and obligations evidenced hereby with respect to such liens are subordinate in the manner and to the extent set forth in that certain Intercreditor and Lien Subordination Agreement (as the same may be amended or otherwise modified from time to time pursuant to the terms thereof, the “ Subordination Agreement ”), dated as of January 18, 2008 between LASALLE BANK NATIONAL ASSOCIATION , as Administrative Agent and Collateral Agent (the “ Senior Agent ”) for the Lenders (collectively, and together with the Senior Agent and any of their successors and assigns, including any other lender or lenders that at any time refinance or replace the Senior Debt referred to below, the “ Senior Creditors ”) pursuant to that certain Third Amended and Restated Credit Agreement dated as of February 20, 2007 (the “ Senior Credit Agreement ”), and PWJ LENDING II LLC , as Administrative Agent and Collateral Agent (the “ Subordinating Agent ”), for the Agents and the Lenders (collectively, the Subordinating Agent together with the Agents and Lenders party to the Subordinated Credit Agreement, the “ Subordinating Creditors ”) party to that certain Term Loan Credit Agreement, dated as of January 18, 2008 (the “ Subordinated Credit Agreement ”), and WHITEHALL JEWELERS, INC ., a Delaware corporation (the “ Borrower ”), as such Senior Credit Agreement has been and hereafter may be amended, restated, supplemented or otherwise modified from time to time as permitted under the Subordination Agreement and to the liens and security interests securing indebtedness refinancing the indebtedness under such agreements as permitted by the Subordination Agreement; and each holder of this instrument, by its acceptance hereof, irrevocably agrees to be bound by the provisions of the Subordination Agreement applicable to the Subordinating Creditors as if such holder were a Subordinating Creditor for all purposes of the Subordination Agreement.

TERM LOAN CREDIT AGREEMENT

Dated as of January 18, 2008

by and among

WHITEHALL JEWELERS, INC.,
as Borrower

THE LENDING INSTITUTIONS FROM TIME TO TIME PARTY HERETO,
as Lenders

and

PWJ LENDING II LLC,
as Administrative Agent and Collateral Agent,
for the Agents and the Lenders

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TERM LOAN CREDIT AGREEMENT

           This TERM LOAN CREDIT AGREEMENT is made as of January 18, 2008, by and among (a) WHITEHALL JEWELERS, INC. (the “ Borrower ”), a Delaware corporation having its principal place of business at 125 South Wacker Drive, Suite 2600, Chicago, Illinois 60606, (b) the lending institutions from time to time party hereto (collectively, the “ Lenders “), and (c) PWJ LENDING II LLC (“ Prentice ”), a Delaware limited liability company, as administrative agent (in such capacity, the “ Administrative Agent ”) and the collateral agent (in such capacity, the “ Collateral Agent ”) for the Agents (as hereinafter defined) and the Lenders.

           WHEREAS , the Borrower has requested that the Lenders make an initial term loan to the Borrower in the aggregate principal amount of up to $25,000,000 and, if Availability under the Senior Credit Agreement is less than $5,000,000, an additional term loan to the Borrower in the aggregate principal amount of up to $10,000,000, in each case for, among other things, general corporate and working capital purposes; and

           WHEREAS , the Lenders are willing to provide such loans on the terms and conditions set forth herein.

           NOW, THEREFORE , in consideration of the mutual covenants and agreements contained herein and benefits to be derived herefrom, the Borrower, the Lenders and the Agents agree as follows:

1.      DEFINITIONS AND RULES OF INTERPRETATION .

           1.1      Definitions . The following terms shall have the meanings set forth in this Section 1 or elsewhere in the provisions of this Credit Agreement referred to below:

           Administrative Agent . Prentice, in its capacity as administrative agent for the benefit of Lenders and the Agents and with respect to the Security Documents.

           Administrative Agent’s Head Office . The Administrative Agent’s head office located at 623 Fifth Avenue, 32nd Floor, New York, New York 10022.

           Administrative Agent’s Special Counsel . Schulte Roth & Zabel LLP, or such other counsel as may be approved by the Administrative Agent.

           Affiliate . Any Person (other than Prentice, its Affiliates, associates and Related Funds) that would be considered to be an affiliate of the Borrower under Rule 144(a) of the Rules and Regulations of the Securities and Exchange Commission, as in effect on the date hereof, if the Borrower were issuing securities.

           Agents . Collectively, the Administrative Agent and the Collateral Agent.

           Asset Disposition Prepayment . See Section 5.4.3 .

           Assignment and Acceptance . See Section 19.1 .

           Availability . As defined in the Senior Credit Agreement

           Balance Sheet Date . December 31, 2006.

           Blocked Account Agreement . Each Blocked Account Agreement entered into by the Borrower, the Senior Administrative Agent and a depository institution satisfactory to the Senior Administrative Agent, which shall be in form and substance acceptable to the Administrative Agent.

           Borrower . As defined in the preamble hereto.

           Borrowing Base Report . A Borrowing Base Report , as defined in and as attached to the Senior Credit Agreement as Exhibit H.

           Business Day . Any day, other than a Saturday or Sunday, on which banking institutions in Chicago, Illinois and New York, New York are open for the transaction of banking business.

           Capital Assets . Fixed and/or capital assets, both tangible (such as land, buildings, fixtures, samples, tools and die, software, software development, machinery and equipment) and intangible (such as software, patents, copyrights, trademarks, franchises and goodwill); provided that Capital Assets shall not include any item customarily charged directly to expense or depreciated over a useful life of twelve (12) months or less in accordance with Generally Accepted Accounting Principles.

           Capital Expenditures . Amounts paid or indebtedness incurred by the Borrower or any of its Subsidiaries in connection with the purchase or lease by the Borrower or any of its Subsidiaries of Capital Assets that would be required to be capitalized and shown on the balance sheet of such Person in accordance with Generally Accepted Accounting Principles.

           Capitalized Leases . Leases under which the Borrower or any of its Subsidiaries is the lessee or obligor, the discounted future rental payment obligations under which are required to be capitalized on the balance sheet of the lessee or obligor in accordance with Generally Accepted Accounting Principles.

           CERCLA . See Section 7.18 .

           Closing Fee . See Section 5.6 .

           Code . The Internal Revenue Code of 1986, as amended.

           Collateral . All of the property, rights and interests of the Borrower that are or are intended to be subject to the security interests created by the Security Documents.

           Collateral Agent . Prentice, in its capacity as collateral agent for the benefit of Lenders and the Agents under and with respect to the Security Documents.

           Collateral Agent Advance . See Section 15.10 .

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           Commitments . With respect to each Lender, its respective Initial Term Loan Commitment and Second Term Loan Commitment.

           Commitment Percentage . With respect to each Lender, the percentage set forth on Schedule 1 hereto as such Lender’s percentage of the Total Commitments.

           Consolidated or consolidated . With reference to any term defined herein, shall mean that term as applied to the accounts of the Borrower and its Subsidiaries, consolidated in accordance with Generally Accepted Accounting Principles.

           Consolidated EBITDA . With respect to the Borrower and its Subsidiaries and any particular fiscal period, the consolidated earnings (or loss) from operations of the Borrower and its Subsidiaries for such period, after eliminating therefrom all non-cash extraordinary nonrecurring items of income (including gains on the sale of assets and earnings from the sale of discontinued business lines), and after all expenses and other proper charges, but before payment or provision for (a) any income taxes or interest expenses for such period, (b) depreciation for such period, (c) amortization for such period, and (d) all other non-cash charges for such period, all determined in accordance with Generally Accepted Accounting Principles.

           Credit Agreement . This Credit Agreement, including the Schedules and Exhibits hereto, as may be amended, modified or restated from time to time.

           Default . See Section 13.1 .

           Delinquent Lender . Means any Lender that fails (i) to make available to the Administrative Agent its pro rata share of any Loan in accordance with its Commitments or (ii) to comply with the provisions of Section 15 with respect to making dispositions and arrangements with the other Lenders, where such Lender’s share of any payment received, whether by setoff or otherwise, is in excess of its pro rata share of such payments due and payable to all of the Lenders, in each case as, when and to the full extent required by the provisions of this Credit Agreement. A “Delinquent Lender” shall be deemed a Delinquent Lender until such time as such delinquency is satisfied.

           Distribution . The declaration or payment of any dividend on or in respect of any shares of any class of capital stock of the Borrower, other than dividends payable solely in shares of common stock of the Borrower; the purchase, redemption, or other retirement of any shares of any class of capital stock of the Borrower, directly or indirectly through a Subsidiary of the Borrower or otherwise; the return of capital by the Borrower to its shareholders as such; or any other distribution on or in respect of any shares of any class of capital stock of the Borrower.

           Dollars or $ . Dollars in lawful currency of the United States of America.

           Eligible Assignee . Any of (i) a commercial bank or finance company organized under the laws of the United States, or any State thereof or the District of Columbia, and having total assets in excess of $1,000,000,000; (ii) any Affiliate or Related Fund of an Agent or Lender; (iii) a savings and loan association or savings bank organized under the laws of the United States, or any State thereof or the District of Columbia, and having a net worth of at least $100,000,000, calculated in accordance with Generally Accepted Accounting Principles; (iv) a

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commercial bank organized under the laws of any other country which is a member of the Organization for Economic Cooperation and Development (the “OECD”), or a political subdivision of any such country, and having total assets in excess of $1,000,000,000, provided that such bank is acting through a branch or agency located in the country in which it is organized or another country which is also a member of the OECD; (v) the central bank of any country which is a member of the OECD; and (vi) any other bank, insurance company, commercial finance company or other financial institution or other Person approved by the Administrative Agent, such approval not to be unreasonably withheld.

           Employee Benefit Plan . Any employee benefit plan within the meaning of Section 3(3) of ERISA maintained of contributed to by the Borrower or any ERISA Affiliate, other than a Multiemployer Plan.

           Environmental Laws . See Section 7.18(a) .

           ERISA . The Employee Retirement Income Security Act of 1974.

           ERISA Affiliate . Any Person which is treated as a single employer with the Borrower under Section 414 of the Code.

           ERISA Reportable Event . A reportable event with respect to a Guaranteed Pension Plan within the meaning of Section 4043 of ERISA and the regulations promulgated thereunder as to which the requirement of notice has not been waived.

           Event of Default . See Section 13.1 .

           Foreign Subsidiary . See Section 8.19 .

           Generally Accepted Accounting Principles or GAAP . (i) When used in Section 10 , whether directly or indirectly through reference to a capitalized term used therein, means (A) principles that are consistent with the principles promulgated or adopted by the Financial Accounting Standards Board and its predecessors, in effect for the fiscal year ended on the Balance Sheet Date, and (B) to the extent consistent with such principles, the accounting practice of the Borrower reflected in its financial statements for the year ended on the Balance Sheet Date; provided , however , that if any change in such principles promulgated by the Financial Accounting Standards Board and its predecessors following the Balance Sheet Date would affect (or would result in a change in the method of calculation of) any of the covenants set forth in Section 10 or any definition related thereto, then the Borrower, the Agents and the Lenders will negotiate in good faith to amend all such covenants and definitions as would be affected by such changes in such principles to the extent necessary to maintain the economic terms of such covenants as in effect under this Credit Agreement immediately prior to giving effect to such changes in such principles; provided further that until the amendment of such covenants and definitions shall have been agreed upon by the Borrower, the Agents and the Required Lenders, the covenants and definitions in effect immediately prior to such amendment shall remain in effect and any determination of compliance with any covenant set forth in Section 10 shall be construed in accordance with Generally Accepted Accounting Principles as in effect immediately prior to such amendment and consistently applied, and (ii) when used in general, other than as provided above, means principles that are (A) consistent with the principles promulgated or

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adopted by the Financial Accounting Standards Board and its predecessors, as in effect from time to time, and (B) consistently applied with past financial statements of the Borrower adopting the same principles, provided that in each case referred to in this definition of “Generally Accepted Accounting Principles” a certified public accountant would, insofar as the use of such accounting principles is pertinent, be in a position to deliver an unqualified opinion (other than a qualification regarding changes in Generally Accepted Accounting Principles) as to financial statements in which such principles have been properly applied.

           Guaranteed Pension Plan . Any employee pension benefit plan within the meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower or any ERISA Affiliate the benefits of which are guaranteed on termination in full or in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer Plan.

           Guarantor . Whitehall Jewelers Holdings, Inc., a Delaware corporation.

           Guaranty . The Guaranty Agreement executed by the Guarantor in favor of the Collateral Agent, substantially in the form of Exhibit B , as the same may be amended, modified or restated from time to time.

           Hazardous Substances . See Section 7.18(b) .

           Headquarters Landlord Consent . The Landlord Consent and Waiver, to be given by the lessor with respect to the Borrower’s leased real property located in Chicago, Illinois at which the Borrower maintains its headquarters and central warehouse, such Headquarters Landlord Consent being in form and substance satisfactory to the Lenders and the Agents.

           Indebtedness . As to any Person and whether recourse is secured by or is otherwise available against all or only a portion of the assets of such Person and whether or not contingent, but without duplication:

                     (i) every obligation of such Person for money borrowed,

                     (ii) every obligation of such Person evidenced by bonds, debentures, notes or other similar instruments, including obligations incurred in connection with the acquisition of property, assets or businesses,

                     (iii) every reimbursement obligation of such Person with respect to letters of credit, bankers’ acceptances or similar facilities issued for the account of such Person,

                     (iv) every obligation of such Person issued or assumed as the deferred purchase price of property or services (including securities repurchase agreements but excluding trade accounts payable or accrued liabilities arising in the ordinary course of business which are not overdue or which are being contested in good faith),

                     (v) every obligation of such Person under any Capitalized Lease,

                     (vi) every obligation of such Person under any lease (generally referred to as being a “synthetic lease”) treated as an operating lease under Generally Accepted Accounting

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Principles and as a loan or financing for United States income tax purposes and pursuant to which the lessee retains economic risk with respect to the value of the residual interest in the leased property,

                     (vii) all sales by such Person of (A) accounts or general intangibles for money due or to become due, (B) chattel paper, instruments or documents creating or evidencing a right to payment of money or (C) other receivables (collectively “receivables”), whether pursuant to a purchase facility or otherwise, other than in connection with the disposition of the business operations of such Person relating thereto or a disposition of defaulted receivables for collection and not as a financing arrangement, and together with any obligation of such Person to pay any discount, interest, fees, indemnities, penalties, recourse, expenses or other amounts in connection therewith,

                     (viii) every obligation of such Person (an “equity related purchase obligation”) to purchase, redeem, retire or otherwise acquire for value any shares of capital stock of any class issued by such Person, any warrants, options or other rights to acquire any such shares, or any rights measured by the value of such shares, warrants, options or other rights,

                     (ix) every obligation of such Person under any forward contract, futures contract, swap, option or other financing agreement or arrangement (including, without limitation, caps, floors, collars and similar agreements), the value of which is dependent upon interest rates, currency exchange rates, commodities or other indices,

                     (x) every obligation in respect of Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent that such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent that the terms of such Indebtedness provide that such Person is not liable therefor and such terms are enforceable under applicable law, and

                     (xi) every obligation, contingent or otherwise, of such Person guaranteeing, or having the economic effect of guarantying or otherwise acting as surety for, any obligation of a type described in any of clauses (i) through (x) (the “primary obligation”) of another Person (the “primary obligor”), in any manner, whether directly or indirectly, and including, without limitation, any obligation of such Person (A) to purchase or pay (or advance or supply funds for the purchase of) any security for the payment of such primary obligation, (B) to purchase property, securities or services for the purpose of assuring the payment of such primary obligation, or (C) to maintain working capital, equity capital or other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such primary obligation.

           The “amount” or “principal amount” of any Indebtedness at any time of determination represented by (w) any Indebtedness, issued at a price that is less than the principal amount at maturity thereof, shall be the amount of the liability in respect thereof determined in accordance with Generally Accepted Accounting Principles, (x) any Capitalized Lease shall be the principal component of the aggregate of the rentals obligation under such Capitalized Lease payable over the term thereof that is not subject to termination by the lessee, (y) any sale of receivables shall be the amount of unrecovered capital or principal investment of the purchaser (other than the

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Borrower or any of its wholly-owned Subsidiaries) thereof, excluding amounts representative of yield or interest earned on such investment, and (z) any equity related purchase obligation shall be the maximum fixed redemption or purchase price thereof inclusive of any accrued and unpaid dividends to be comprised in such redemption or purchase price.

           Initial Closing Date . The first date on which the conditions set forth in Sections 11.1 through 11.25 have been satisfied or waived and the Initial Term Loan is made.

           Initial Term Loan . See Section 2.1(a) .

           Initial Term Loan Commitment . With respect to each Lender, the amount set forth on Schedule 1 hereto as the amount of such Lender’s commitment to make the Initial Term Loan to the Borrower pursuant to the terms of the Credit Agreement.

           Initial Term Loan Notes . See Section 2.1(a) .

           Intercreditor Agreement . That certain Intercreditor and Lien Subordination Agreement entered into by and between the Collateral Agent, on behalf of the Lenders, and the Senior Collateral Agent, on behalf of the Senior Lenders, dated as of January 18, 2008, as the same may be amended, modified or restated from time to time.

           Interest Payment Date . See Section 2.3 .

           Interest Rate . See Section 2.3 .

           Investments . All expenditures made and all liabilities incurred (contingently or otherwise) for the acquisition of stock or Indebtedness of, or for loans, advances, capital contributions or transfers of property to, or in respect of any guaranties (or other commitments as described under Indebtedness), or obligations of, any Person. In determining the aggregate amount of Investments outstanding at any particular time: (i) the amount of any Investment represented by a guaranty shall be taken at not less than the principal amount of the obligations guaranteed and still outstanding; (ii) there shall be included as an Investment all interest accrued with respect to Indebtedness constituting an Investment unless and until such interest is paid; (iii) there shall be deducted in respect of each such Investment any amount received as a return of capital (but only by repurchase, redemption, retirement, repayment, liquidating dividend or liquidating distribution); (iv) there shall not be deducted in respect of any Investment any amounts received as earnings on such Investment, whether as dividends, interest or otherwise, except that accrued interest included as provided in the foregoing clause (ii) may be deducted when paid; and (v) there shall not be deducted from the aggregate amount of Investments any decrease in the value thereof.

           Landlord Waiver . Collectively, each waiver from the lessor or sublessor of property leased by the Borrower as lessee, substantially in the form of a Collateral Access Agreement (as defined in the Senior Credit Agreement).

           Lenders . Each of the lending institutions party hereto and any other Person who becomes an assignee of any rights and obligations of a Lender pursuant to Section 19.

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           Loan Account . See Section 5.2.1.

           Loan Documents . This Credit Agreement, the Notes, the Security Documents, and all other agreements, instruments, and other documents executed and delivered pursuant hereto or thereto or otherwise evidencing, guaranteeing or securing the Loans or any other Obligations.

           Loans . The Term Loans and any other loans made by one or more of the Lenders to the Borrower pursuant to the terms of the Credit Agreement.

           Majority Lenders . As of any date, the Lenders (other than Delinquent Lenders) whose aggregate Commitments together constitute fifty-one percent (51%) of the Total Commitment.

           Mandatory Prepayments . Each of the Senior Facility Termination Prepayment, Asset Disposition Prepayment, and New Issuance Prepayment, in each case pursuant to Section 5.4.

           Maturity Date . The earliest to occur of (i) one day after the “Maturity Date” under (and as defined in) the Senior Credit Agreement, (ii) the date on which the maturity of the Loans is accelerated in accordance with Section 13.1, and (iii) the date of the occurrence of an Event of Default pursuant to Sections 13.1(g) and (h).

           Monthly Inventory Report . A Monthly Inventory Report signed by the Controller, Senior Vice President of Finance or principal financial or accounting officer of the Borrower in substantially the form of Exhibit C hereto.

           Multiemployer Plan . Any multiemployer plan within the meaning of Section 3(37) of ERISA maintained or contributed to by the Borrower or any ERISA Affiliate.

           Net Proceeds . With respect to any sale or other disposition of any asset by any Person or any issuance of Indebtedness or equity securities of such Person, the excess of (i) the gross cash proceeds received by such Person from such sale or disposition or, as the case may be, such issuance, plus , as and when received, all cash payments received subsequent to such sale or disposition or such issuance representing (A) any deferred purchase price therefor or (B) any cash proceeds from the sale or other disposition of any cash equivalents (or any deferred purchase price obligations) received therefor over (ii) the sum of (A) a reasonable reserve for any liabilities payable incident to such sale or disposition or such issuance, (B) reasonable direct costs and expenses incurred by such Person in connection with such sale or disposition or such issuance (including, without limitation, reasonable brokerage, legal, investment banking, accounting, consulting, survey, title and recording fees and commissions), (C) all payments actually made on any Indebtedness (other than the Obligations) or other obligations which are secured by any assets subject to such sale or disposition which are required to be repaid out of the proceeds from such transaction and (D) actual tax payments made or to be made in connection therewith.

           New Issuance Prepayment . See Section 5.4.4 .

           Notes . Each of the Initial Term Loan Notes and the Second Term Loan Notes.

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           Obligations . All indebtedness, obligations and liabilities of any of the Borrower and its Subsidiaries to any of the Lenders and the Agents, individually or collectively, existing on the date of this Credit Agreement or arising thereafter, direct or indirect, joint or several, absolute or contingent, matured or unmatured, liquidated or unliquidated, secured or unsecured, arising by contract, operation of law or otherwise, arising or incurred under this Credit Agreement or any of the other Loan Documents or in respect of the Loans or any of the Notes or other instruments or documents at any time evidencing any thereof.

           Outstanding . With respect to any Loan, the aggregate unpaid principal thereof as of any date of determination.

           PBGC . The Pension Benefit Guaranty Corporation created by Section 4002 of ERISA and any successor entity or entities having similar responsibilities.

           Payment Office . The Agents’ office located at the address set forth in Section 20(b) , or at such other office or offices of the Agents as may be designated in writing from time to time by the Agents to the Borrower.

           Permitted Inventory Locations . The retail stores and distribution centers of the Borrower and its Subsidiaries located in the United States of America and listed on Schedule 2 hereto, as such Schedule 2 may be supplemented from time to time in accordance with the provisions of Section 8.4(j) .

           Permitted Liens . Liens, security interests and other encumbrances permitted by Section 9.2 .

           Person . Any individual, corporation, partnership, limited liability company, trust, unincorporated association, business, or other legal entity, and any government or any governmental agency or political subdivision thereof.

           Prentice . See preamble hereto.

           Prentice Lenders . Prentice, in its capacity as a Lender, and all other Lenders that are successors to or assignees of Prentice.

           Real Estate . All real property at any time owned or leased (as lessee or sublessee) by the Borrower or any of its Subsidiaries.

           Record . The grid attached to a Note, or the continuation of such grid, or any other similar record, including computer records, maintained by any Lender with respect to any Loan referred to in such Note.

           Register . See Section 19.3 .

           Registered Loan . See Section 19.3 .

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           Related Fund . With respect to any Lender or Agent which is a fund that invests in loans, any other such fund managed by the same investment advisor as such Lender or Agent or by an Affiliate of such Lender or Agent or such advisor.

           Required Lenders . As of any date, the Lenders (other than Delinquent Lenders) whose aggregate Commitments together constitute at least sixty-six and two-thirds percent (66 ² / ₃ %) of the Total Commitment.

           Second Closing Date . The first date on which the conditions set forth in Section 11.26 have been satisfied or waived and the Second Term Loan is made to the Borrower.

           Second Term Loan . See Section 2.1(b) .

           Second Term Loan Commitment . With respect to each Lender, the amount set forth on Schedule 1 hereto as the amount of such Lender’s commitment to make the Second Term Loan to the Borrower pursuant to the terms of the Credit Agreement.

           Second Term Loan Notes . See Section 2.1(b) .

           Security Agreement . The Security Agreement, dated as of the date hereof, between the Borrower and the Collateral Agent, as may be amended, modified or restated from time to time.

           Security Documents . The Security Agreement, the Headquarters Landlord Consent, the Landlord Waivers, the Security Interest Grant in Patents, the Security Interest Grant in Trademarks, all Blocked Account Agreements, the Guaranty and all other agreements, instruments and other documents guaranteeing or securing the Loans or any other Obligations, as each may be amended, modified or restated from time to time.

           Security Interest Grant in Patents . The Security Interest Grant Patents, dated as of the date hereof, executed by the Borrower in favor of the Agents.

           Security Interest Grant in Trademarks . The Security Interest Grant Trademarks, dated as of the date hereof, executed by the Borrower in favor of the Agents.

           Senior Administrative Agent . LaSalle Bank National Association, in its capacity as Administrative Agent for the Senior Lenders under the Senior Credit Agreement.

           Senior Agents . LaSalle Bank National Association (or any successor) in its capacity as administrative agent and collateral agent under the Senior Credit Agreement, ABN Amro Bank N.V. in its capacity as syndication agent under the Senior Credit Agreement and JPMorgan Chase Bank in its capacity as documentation agent under the Senior Credit Agreement.

           Senior Collateral Agent . LaSalle Bank National Association, in its capacity as Collateral Agent for the Senior Lenders under the Senior Credit Agreement.

           Senior Credit Agreement . The Third Amended and Restated Credit Agreement, dated as of February 20, 2007, among the Borrower, LaSalle Bank National Association, as administrative agent for the banks from time to time party thereto, LaSalle Bank National

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Association, as Collateral Agent for the Senior Lenders and the other agents and parties from time to time party thereto, as the same may be amended, amended and restated, supplemented, refinanced or otherwise modified and in effect from time to time.

           Senior Lenders . The financial institutions from time to time party to the Senior Credit Agreement.

           Senior Loan Documents . In each case as the following terms are defined under the Senior Credit Agreement: the Credit Agreement, the Notes, the Letter of Credit Applications, the Letters of Credit, the Fee Letter and the Security Documents.

           Specified Lease . A lease by the Borrower as lessee of Real Estate at which Inventory is held and as to which at any time either (a) the Borrower and the Agents have not received a Landlord Waiver or (b) the Administrative Agent has not received evidence, in form and substance satisfactory to the Administrative Agent, that, based upon then existing law (as determined by the Administrative Agent in the exercise of its reasonable discretion and on the advice of counsel), the landlord of such property would not have a lien on inventory superior to the security interest granted under the Security Agreement, securing rent obligations more than thirty (30) days past due or securing future rent obligations accruing after the Initial Closing Date.

           Store Accounts . Depository accounts in depository institutions for, or on behalf of, the Borrower or any of its Subsidiaries and listed on Schedule 7.20 hereto (as such may be amended from time to time in accordance with the terms hereof).

           Subordinated Indebtedness . Any Indebtedness of the Borrower or any of its Subsidiaries the terms of which are satisfactory to the Agents and the Majority Lenders and which has been expressly subordinated in right of payment to all Obligations of the Borrower and its Subsidiaries under the Loan Documents (and which has a maturity date after the Maturity Date) by the execution and delivery of a subordination agreement, in form and substance reasonably satisfactory to the Agents and the Majority Lenders, or otherwise on terms and conditions (including, without limitation, subordination provisions, payment terms, interest rates, covenants, remedies, defaults and other material terms) reasonably satisfactory to the Agents and the Majority Lenders.

           Subsidiary . Any corporation, association, trust, or other business entity of which the designated parent shall at any time own directly or indirectly through a Subsidiary or Subsidiaries at least a majority (by number of votes) of the outstanding Voting Stock.

           Supplier or Suppliers . Individually and collectively, one or more suppliers of inventory to the Borrower and its Subsidiaries.

           Term Loan . The Initial Term Loan or the Second Term Loan, as applicable.

           Term Loans . The Initial Term Loan and the Second Term Loan.

           Term Loan Note Record . Each Record with respect to a Note.

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           Total Commitment . The sum of the Commitments of the Lenders, such amount being equal to $35,000,000 as of the Initial Closing Date.

           Trade Vendor Extension Agreement . Collectively, that certain Amended Trade Vendor Extension Agreement entered into by and between the Borrower, Prentice Capital Management LP, and certain Suppliers, as contemplated by the Trade Vendor Term Sheet, the Trade Vendor Term Sheet and any notes or other documents and agreements entered into in connection therewith, as such notes or other documents and agreements may have been amended prior to the date hereof.

           Trade Vendor Term Sheet . That certain binding term sheet entitled Terms for Treatment of Trade Indebtedness of Whitehall Jewelers, Inc., entered into by and among the Borrower, Prentice Capital Management LP and certain Suppliers in September 2005.

           Unanimous Lenders . As of any date, the Lenders (other than Delinquent Lenders) whose aggregate Commitments together constitute One hundred percent (100%) of the Total Commitment.

           Voting Stock . Stock or similar interests, of any class or classes (however designated), the holders of which are at the time entitled, as such holders, to vote for the election of a majority of the directors (or persons performing similar functions) of the corporation, association, trust or other business entity involved, whether or not the right so to vote exists by reason of the happening of a contingency.

           1.2      Rules of Interpretation .

                     (a)     A reference to any document or agreement shall include such document or agreement as amended, modified or supplemented from time to time in accordance with its terms and the terms of this Credit Agreement.

                     (b)     The singular includes the plural and the plural includes the singular.

                     (c)     A reference to any law includes any amendment or modification to such law.

                     (d)     A reference to any Person includes its permitted successors and permitted assigns.

                     (e)     Accounting terms not otherwise defined herein have the meanings assigned to them by Generally Accepted Accounting Principles applied on a consistent basis by the accounting entity to which they refer.

                     (f)     The words “include”, “includes” and “including” are not limiting.

                     (g)     All terms not specifically defined herein or by Generally Accepted Accounting Principles, which terms are defined in the Uniform Commercial Code as in effect in the State of New York, as in effect from time to time, have the meanings assigned to them therein.

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                     (h)     Reference to a particular “Section” refers to that section of this Credit Agreement unless otherwise indicated.

                     (i)     The words “herein”, “hereof”, “hereunder” and words of like import shall refer to this Credit Agreement as a whole and not to any particular section or subdivision of this Credit Agreement.

2. TERM LOANS .

           2.1      Term Loans .

                     (a)     Each Lender severally and not jointly with any other Lender, agrees, upon the terms and subject to the conditions herein set forth, on the Initial Closing Date to make a term loan to the Borrower in a single drawing in an aggregate principal amount not to exceed the amount of such Lender’s Initial Term Loan Commitment (the “ Initial Term Loan ”); provided that the aggregate principal amount of the Initial Term Loan shall equal $25,000,000 .

                     (b)     Each Lender severally and not jointly with any other Lender, agrees, upon the terms and subject to the conditions herein set forth, on the Second Closing Date to make a second term loan to the Borrower in a single drawing in an aggregate principal amount of such Lender’s Second Term Loan Commitment (the “ Second Term Loan ”); provided that the aggregate principal amount of the Second Term Loan shall equal $10,000,000 .

                     (c)     The Initial Term Loan shall be made by the Lenders simultaneously on the Initial Closing Date and in accordance with their respective Initial Term Loan Commitment. The Second Term Loan shall be made by the Lenders simultaneously on the Second Closing Date and in accordance with their respective Second Term Loan Commitment. The failure of any Lender to make its portion of either Term Loan shall neither relieve any other Lender of its obligation to fund its portion of such Term Loan in accordance with the provisions of this Credit Agreement nor increase the obligation of any such other Lender.

                     (d)     Any portion of a Term Loan that is repaid may not be reborrowed.

                     (e)     The Administrative Agent, without the request of the Borrower, may advance any interest, fee, service charge, or other payment to which any Agent or their Affiliates or any Lender is entitled from the Borrower pursuant hereto or any other Loan Document and may charge the same to the Loan Account. The Lenders and the Borrower confirm that any charges which the Administrative Agent may so make to the Loan Account of the Borrower as herein provided will be made as an accommodation to the Borrower and solely at the Administrative Agent’s discretion, provided that the Administrative Agent shall from time to time upon the request of the Collateral Agent, charge the Loan Account of the Borrower with any amount due and payable under any Loan Document, including, without limitation, any Collateral Agent Advance. The Administrative Agent shall advise the Borrower of any such advance or charge promptly after the making thereof. Any amount which is added to the principal balance of the Loan Account as provided in this Section 2.1(d) shall bear interest at the Interest Rate and shall be payable on the Maturity Date.

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           2.2      Notes; Repayment of Term Loans .

                     (a)     The Initial Term Loan shall be evidenced by this Credit Agreement and/or one or more promissory notes duly executed on behalf of the Borrower, dated the Initial Closing Date, in substantially the form attached hereto as Exhibit A-1 (each, an “ Initial Term Loan Note ” and, collectively, the “ Initial Term Loan Notes ”), payable to the order of a Lender in the aggregate principal amount equal to the principal amount of the portion of the Initial Term Loan advanced by such Lender plus the amount of any interest capitalized thereon in accordance with the terms of this Credit Agreement. The Second Term Loan shall be evidenced by this Credit Agreement and/or one or more promissory notes duly executed on behalf of the Borrower, dated the Second Closing Date, in substantially the form attached hereto as Exhibit A-2 (each, a “ Second Term Loan Note ” and, collectively, the “ Second Term Loan Notes ”), payable to the order of a Lender in the aggregate principal amount equal to the principal amount of the portion of the Second Term Loan advanced by such Lender plus the amount of any interest capitalized thereon in accordance with the terms of this Credit Agreement. The outstanding principal balance of all Obligations shall be payable on the Maturity Date (subject to earlier repayment as provided below). The Term Loans (including, without limitation, any interest capitalized thereon and added to the outstanding principal balance of such Loans in accordance with the terms hereof) shall bear interest from the date hereof on the outstanding principal balance thereof as set forth in this Section 2 or Section 5 , as the case may be. Each Lender is hereby authorized by the Borrower to endorse on a schedule attached to each Note delivered to such Lender (or on a continuation of such schedule attached to such Note and made a part thereof), or otherwise to record in such Lender’s internal records, an appropriate notation evidencing the date and amount of each Term Loan from such Lender, each payment and prepayment of principal of such Term Loan, each payment of interest on such Term Loan and the other information provided for on such schedule; provided , however , that the failure of any Lender to make such a notation or any error therein shall not affect the obligation of the Borrower to repay any Term Loan made by such Lender in accordance with the terms of this Credit Agreement and the applicable Notes.

                     (b)     Upon receipt of indemnification reasonably satisfactory to the Borrower, and an affidavit of a Lender as to the loss, theft, destruction or mutilation of such Lender’s Note and upon cancellation of such Note, the Borrower will issue, in lieu thereof, a replacement Note in favor of such Lender, in the same principal amount thereof and otherwise of like tenor.

           2.3      Interest on Term Loans .

                     (a)     Each Term Loan shall bear interest (computed on the basis of the actual number of days elapsed over a year of 360 days) on the principal amount thereof from time to time outstanding, from the date of the making of such Term Loan until such principal amount is repaid in full, at a rate per annum equal to 15% (the “ Interest Rate ”).

                     (b)     Interest accrued on the Term Loans shall be payable monthly in arrears in cash, on the first Business Day of each month (each, an “ Interest Payment Date ”), commencing on February 1, 2008, on the Maturity Date (whether by acceleration or otherwise), and, after the Maturity Date, on demand.

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                     (c)     The Borrower shall repay the entire unpaid principal balance of the Term Loans (including, without limitation, any capitalized interest thereon) and all accrued and unpaid interest thereon on the Maturity Date.

           2.4      Termination of Commitments .

                     Each Initial Term Loan Commitment shall terminate at 5:00 p.m. (New York City time) on the Initial Closing Date, and each Second Term Loan Commitment shall terminate at 5:00 p.m. (New York City time) on the Second Closing Date; provided , however , that each Second Term Loan Commitment shall terminate automatically if the Second Closing Date does not occur on or before April 30, 2008.

           2.5      Maturity . The Borrower promises to pay on the Maturity Date, and there shall become absolutely due and payable on the Maturity Date, to the Administrative Agent for the benefit of the Lenders, (a) all of the Term Loans outstanding on such date (including, without limitation, any capitalized interest thereon), together with any and all accrued and unpaid interest thereon and (b) all other Obligations then outstanding hereunder and under the other Loan Documents.

           2.6      Optional Repayments of Term Loans . The Borrower shall have the right, at its election, to repay the outstanding Term Loans in accordance with the provisions of Section 5.3 hereof.

3.      INTENTIONALLY OMITTED .

4.      INTENTIONALLY OMITTED .

5.      CERTAIN GENERAL PROVISIONS .

           5.1      Default Interest . Effective upon the occurrence of any Event of Default and at all times thereafter while such Event of Default is continuing, at the option of the Administrative Agent or upon the direction of the Required Lenders, interest shall accrue on all outstanding Obligations (after as well as before judgment, as and to the extent permitted by law) at a rate per annum equal to the rate in effect from time to time plus 3% per annum, and such interest shall be payable on demand.

           5.2      Maintenance of Loan Account; Statement of Account .

                     5.2.1     The Administrative Agent shall maintain an account on its books in the name of the Borrower (the “ Loan Account ”) which will reflect the Loans and any and all other Obligations that have become payable.

                     5.2.2     The Loan Account will be credited with all amounts received by the Administrative Agent from the Borrower or otherwise for the Borrower’s account, and the amounts so credited shall be applied as set forth in Section 2.2(a) . After the end of each month, the Administrative Agent shall send to the Borrower a statement accounting for the charges, loans, advances and other transactions occurring among and between the Administrative Agent,

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the Lenders and the Borrower during that month. The monthly statements shall, absent manifest error, be final, conclusive and binding on the Borrower.

           5.3      Optional Prepayment of Loans . The Borrower may upon at least five (5) Business Days’ prior written notice to the Administrative Agent, prepay, without penalty or premium, all or any portion of the principal balance of any Loan. Each prepayment made pursuant to this Section 5.3 shall be accompanied by the payment of accrued interest to the date of such payment on the amount prepaid.

           5.4      Mandatory Prepayments of Loans .

                     5.4.1      Termination of Senior Loan Agreement . The Borrower shall immediately prepay all Obligations (a “ Senior Facility Termination Prepayment ”) in the event that the Senior Credit Agreement is terminated for any reason and either (i) the Senior Credit Agreement is not replaced with another credit agreement and related transaction documentation, the terms and conditions of which are no less favorable to the Borrower, the Agents and the Lenders than the Senior Credit Agreement, including with respect to any intercreditor arrangements (as determined by the Agents in their discretion) or (ii) the lenders and agents party to such new credit agreement are not reasonably acceptable to the Agents and the Required Lenders.

                     5.4.2      Intentionally Omitted.

                     5.4.3      Asset Disposition Prepayment . Subject to the terms of the Intercreditor Agreement, the Borrower shall pay to the Administrative Agent, for the accounts of the Lenders (each, an “ Asset Disposition Prepayment ”), immediately upon the receipt by the Borrower of the proceeds of any asset dispositions, an amount equal to one hundred percent (100%) of the Net Proceeds received by the Borrower in connection with such asset disposition.

                     5.4.4      New Issuance Prepayment . Subject to the terms of the Intercreditor Agreement, the Borrower shall pay to the Agent (unless the Majority Lenders elect not to require such Mandatory Prepayment), for the accounts of the Lenders (each, a “ New Issuance Prepayment ”), immediately after the completion by the Borrower of any issuance of (i) Indebtedness or (ii) equity securities of the Borrower or any of its Subsidiaries, including, without limitation, any issuance of warrants, options or subscription rights (other than issuances of common stock to employees of the Borrower), an amount equal to one hundred percent 100% of the Net Proceeds received by the Borrower in connection with any such issuance.

                     5.4.5      Applications of Mandatory Prepayments . Each Mandatory Prepayment received by the Administrative Agent shall be applied to the Obligations as follows:

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           5.5      Repayments of Loans and Distribution of Collateral Proceeds After Event of Default . Subject to the terms of the Intercreditor Agreement and any subordination or other agreement among the Agents and the Lenders, in the event that following the occurrence and during the continuance of an Event of Default, the Collateral Agent, any other Agent or any Lender, as the case may be, receives any monies, whether pursuant to Section 8.14 (as applicable) or Section 13.3 or otherwise with respect to the realization upon any of the Collateral, such monies shall be distributed for application as follows:

                     (a)      first , to the payment of, or (as the case may be) the reimbursement of the Agents for or in respect of all reasonable costs, expenses, disbursements and losses which shall have been incurred or sustained by the Agents in connection with the collection of such monies by the Agents, for the exercise, protection or enforcement by the Collateral Agent of all or any of the rights, remedies, powers and privileges of the Collateral Agent, for the benefit of the Agents and the Lenders, under this Credit Agreement or any of the other Loan Documents or in respect of the Collateral (including, without limitation, Collateral Agent Advances), including, without limitation, the fees and expenses of counsel to the Agents or in support of any provision of adequate indemnity to the Agents against any taxes or liens which by law shall have, or may have, priority over the rights of the Agents to such monies;

                     (b)      second , to pay all accrued and unpaid interest on the Loans (to the extent not previously capitalized hereunder), which shall be applied on a pro rata basis among the Loans, until paid in full;

                     (c)      third , to repay the Loans (to the extent not previously capitalized hereunder), which shall be applied on a pro rata basis among the Loans, until paid in full;

                     (d)      fourth , to repay all other Obligations due and owing to the Agents and the Lenders under the Loan Documents, until paid in full; and

                     (e)      fifth , the excess, if any, shall be returned to the Borrower or to such other Persons as are entitled thereto.

           Subject to the terms of any subordination or other agreement among the Agents and the Lenders, all distributions in respect of the Obligations owing to the Lenders with respect to each type of Obligation under each of the categories specified above such as interest, principal, fees and expenses, shall be made among the Lenders entitled thereto pro rata, in accordance with their respective Commitment Percentages; and provided , further , that the Agents may in their discretion make proper allowance to take into account any Obligations not then due and payable.

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           5.6      Closing Fee . The Borrower shall pay to Prentice Capital Management, LP, pursuant to an arrangement between PWJ Lending II LLC and Prentice Capital Management, LP, a fee in the amount of $1,050,000 (the “ Closing Fee ”), $750,000 of which shall be paid on the Initial Closing Date (the “ Initial Closing Fee ”) and the remaining $300,000 of which shall be paid on the Second Closing Date (the “ Second Closing Fee ”), which Closing Fee shall be non-refundable and fully-earned and payable on the Initial Closing Date and the Second Closing Date, respectively.

           5.7      Funds for Payments .

                     5.7.1      Payments to Administrative Agent . All payments of principal, interest, closing fees and any other amounts due hereunder or under any of the other Loan Documents shall be made to the Administrative Agent, for the respective accounts of the Lenders and the Administrative Agent, at the Administrative Agent’s Head Office or at such other location that the Administrative Agent may from time to time designate, in each case in immediately available funds in Dollars.

                     5.7.2      No Offset, etc. All payments by the Borrower hereunder and under any of the other Loan Documents shall be made without setoff or counterclaim and free and clear of and without deduction for any taxes, levies, imposts, duties, charges, fees, deductions, withholdings, compulsory loans, restrictions or conditions of any nature now or hereafter imposed or levied by any jurisdiction or any political subdivision thereof or taxing or other authority therein unless the Borrower is compelled by law to make such deduction or withholding. If any such obligation is imposed upon the Borrower with respect to any amount payable by it hereunder or under any of the other Loan Documents, the Borrower will pay to the Administrative Agent, for the account of the Lenders or (as the case may be) the Agents, on the date on which such amount is due and payable hereunder or under such other Loan Document, such additional amount in Dollars as shall be necessary to enable the Lenders or the Agents to receive the same net amount which the Lenders or the Agents would have received on such due date had no such obligation been imposed upon the Borrower. The Borrower will deliver promptly to the Agents certificates or other valid vouchers for all taxes or other charges deducted from or paid with respect to payments made by the Borrower hereunder or under such other Loan Document.

           5.8      Computations . All computations of interest on the Loans and of commitment fees or other fees shall, unless otherwise expressly provided herein, be based on 360-day year and paid for the actual number of days elapsed. Whenever a payment hereunder or under any of the other Loan Documents becomes due on a day that is not a Business Day, the due date for such payment shall be extended to the next succeeding Business Day, and interest shall accrue during such extension. The outstanding amount of the Loans as reflected on the Records maintained by the Agents and each Lender from time to time shall be considered correct and binding on the Borrower unless within five (5) Business Days after receipt of any notice by any of the Agents or the Lenders of such outstanding amount, such Agent or such Lender shall notify the Borrower to the contrary.

           5.9      Additional Costs, etc. If any present or future applicable law, which expression, as used herein, includes statutes, rules and regulations thereunder and interpretations thereof by

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any competent court or by any governmental or other regulatory body or official charged with the administration or the interpretation thereof and requests, directives, instructions and notices at any time or from time to time hereafter made upon or otherwise issued to any Lender or Agent by any central bank or other fiscal, monetary or other authority (whether or not having the force of law), shall:

                     (a)     subject any Lender or Agent to any tax, levy, impost, duty, charge, fee, deduction or withholding of any nature with respect to this Credit Agreement, the other Loan Documents, such Lender’s Commitments or the Loans (other than taxes based upon or measured by the income or profits of such Lender or Agent), or

                     (b)     materially change the basis of taxation (except for changes in taxes on income or profits) of payments to any Lender of the principal of or the interest on any Loans or any other amounts payable to any Lender or Agent under this Credit Agreement or any of the other Loan Documents, or

                     (c)     impose or increase or render applicable (other than to the extent specifically provided for elsewhere in this Credit Agreement) any special deposit, reserve, assessment, liquidity, capital adequacy or other similar requirements (whether or not having the force of law) against assets held by, or deposits in or for the account of, or loans by, or commitments of an office of any Lender, or

                     (d)     impose on any Lender or Agent any other conditions or requirements with respect to this Credit Agreement, the other Loan Documents, such Lender’s Commitments, or any class of loans, or commitments of which any of the Loans or such Lender’s Commitments forms a part, and the result of any of the foregoing is

then, and in each such case, the Borrower will, upon demand made by such Lender or (as the case may be) such Agent at any time and from time to time and as often as the occasion therefor may arise, pay to such Lender or such Agent such additional amounts as will be sufficient to compensate such Lender or such Agent for such additional cost, reduction, payment or foregone interest or other sum.

           5.10      Capital Adequacy . If after the date hereof any Lender or the Administrative Agent determines that (a) the adoption of or change in any law, governmental rule, regulation, policy, guideline or directive (whether or not having the force of law) regarding capital

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requirements for banks or bank holding companies or any change in the interpretation or application thereof by a court or governmental authority with appropriate jurisdiction, or (b) compliance by such Lender or such Agent or any corporation controlling such Lender or such Agent with any law, governmental rule, regulation, policy, guideline or directive (whether or not having the force of law) of any such entity regarding capital adequacy, has the effect of reducing the return on such Lender’s or such Agent’s commitment with respect to any Loans to a level below that which such Lender or such Agent could have achieved but for such adoption, change or compliance (taking into consideration such Lender’s or such Agent’s then existing policies with respect to capital adequacy and assuming full utilization of such entity’s capital) by any amount deemed by such Lender or (as the case may be) such Agent to be material, then such Lender or such Agent may notify the Borrower of such fact. To the extent that the amount of such reduction in the return on capital is not reflected in the Interest Rate, as applicable, the Borrower agrees to pay such Lender or (as the case may be) such Agent for the amount of such reduction in the return on capital as and when such reduction is determined upon presentation by such Lender or (as the case may be) such Agent of a certificate in accordance with Section 5.11 hereof. Each Lender shall allocate such cost increases among its customers in good faith and on an equitable basis.

           5.11      Certificate . A certificate setting forth any additional amounts payable pursuant to Sections 5.9 or 5.10 and a brief explanation of such amounts which are due, submitted by any Lender or Agent to the Borrower, shall be conclusive, absent manifest error, that such amounts are due and owing.

           5.12      Indemnity . The Borrower agrees to indemnify each Lender and to hold each Lender harmless from and against any loss, cost or expense (including loss of anticipated profits) that such Lender may sustain or incur as a consequence of default by the Borrower in payment of the principal amount of or any interest on Loans as and when due and payable.

6.      COLLATERAL SECURITY .

           The Obligations shall be secured by a perfected security interest (subject only to liens in favor of the Senior Collateral Agent, for the benefit of the Senior Lenders and the Senior Agents and Permitted Liens entitled to priority under applicable law) in all of the assets of the Borrower and the Guarantor, whether now owned or hereafter acquired, pursuant to the terms of the Security Documents to which such Person is a party.

7.      REPRESENTATIONS AND WARRANTIES .

           The Borrower represents and warrants to the Lenders and the Agents as follows:

           7.1      Corporate Authority .

                     7.1.1      Incorporation; Good Standing . Each of the Borrower and its Subsidiaries (i) is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation, (ii) has all requisite corporate power to own its property and conduct its business as now conducted and as presently contemplated, and (iii) is in good standing as a foreign corporation and is duly authorized to do business in each jurisdiction where such

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qualification is necessary except where a failure to be so qualified would not have a materially adverse effect on the business, assets or financial condition of the Borrower or such Subsidiary.

                     7.1.2      Authorization . The execution, delivery and performance of this Credit Agreement and the other Loan Documents to which the Borrower or any of its Subsidiaries is or is to become a party and the transactions contemplated hereby and thereby (i) are within the corporate authority of such Person, (ii) have been duly authorized by all necessary corporate proceedings, (iii) do not conflict with or result in any breach or contravention of any provision of law, statute, rule or regulation to which the Borrower or any of its Subsidiaries is subject or any judgment, order, writ, injunction, license or permit applicable to the Borrower or any of its Subsidiaries and (iv) do not conflict with any provision of the corporate charter or bylaws of, or any agreement or other instrument binding upon, the Borrower or any of its Subsidiaries.

                     7.1.3      Enforceability . The execution and delivery of this Credit Agreement and the other Loan Documents to which the Borrower or any of its Subsidiaries is or is to become a party will result in valid and legally binding obligations of such Person enforceable against it in accordance with the respective terms and provisions hereof and thereof, except as enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting generally the enforcement of creditors’ rights and except to the extent that availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor may be brought.

           7.2      Governmental Approvals . The execution, delivery and performance by the Borrower and any of its Subsidiaries of this Credit Agreement and the other Loan Documents to which the Borrower or any of its Subsidiaries is or is to become a party and the transactions contemplated hereby and thereby do not require the approval or consent of, or filing with, any governmental agency or authority other than those already obtained.

           7.3      Title to Properties; Leases . Except as indicated on Schedule 7.3 hereto, the Borrower and its Subsidiaries own all of the assets reflected in the consolidated balance sheet of the Borrower and its Subsidiaries as at the Balance Sheet Date or acquired since that date (except property and assets sold or otherwise disposed of in the ordinary course of business since that date), subject to no rights of others, including any mortgages, leases, conditional sales agreements, title retention agreements, liens or other encumbrances except Permitted Liens.

           7.4      Intentionally Omitted .

           7.5      Solvency . After giving effect to the transactions contemplated by this Credit Agreement, the other Loan Documents and the Senior Credit Agreement, the Borrower and its Subsidiaries on a consolidated basis are Solvent. As used herein, “Solvent” shall mean that the Borrower and its Subsidiaries (i) have assets having a fair value in excess of their liabilities, (ii) have assets having a fair value in excess of the amount required to pay their liabilities on existing debts as such debts become absolute and matured, and (iii) have, and expect to continue to have, access to adequate capital for the conduct of their business and the ability to pay their debts from time to time incurred in connection with the operation of their business as such debts mature.

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           7.6      Franchises, Patents, Copyrights, etc . Each of the Borrower and its Subsidiaries possesses all franchises, patents, copyrights, trademarks, trade names, licenses and permits, and rights in respect of the foregoing, adequate for the conduct of its business substantially as now conducted without known conflict with any rights of others.

           7.7      Litigation . Except as set forth in Schedule 7.7 hereto, there are no actions, suits, proceedings or investigations of any kind pending or threatened against the Borrower or any of its Subsidiaries before any court, tribunal or administrative agency or board that, if adversely determined, might, either in any case or in the aggregate, reasonably be expected to materially adversely affect the properties, assets, financial condition or business of the Borrower and its Subsidiaries or materially impair the right of the Borrower and its Subsidiaries, considered as a whole, to carry on business substantially as now conducted by them, or result in any substantial liability not adequately covered by insurance, or for which adequate reserves are not maintained on the consolidated balance sheet of the Borrower and its Subsidiaries, or which question the validity of this Credit Agreement or any of the other Loan Documents, or might impair or prevent any action taken or to be taken pursuant hereto or thereto.

           7.8      No Materially Adverse Contracts, etc . Neither the Borrower nor any of its Subsidiaries is subject to any charter, corporate or other legal restriction, or any judgment, decree, order, rule or regulation that has or is expected in the future to have a materially adverse effect on the business, assets or financial condition of the Borrower or any of its Subsidiaries. Neither the Borrower nor any of its Subsidiaries is a party to any contract or agreement that has or is expected, in the judgment of the Borrower’s officers, to have any materially adverse effect on the business of the Borrower or any of its Subsidiaries.

           7.9      Compliance with Other Instruments, Laws, etc . Neither the Borrower nor any of its Subsidiaries is in violation of any provision of its charter documents, bylaws, or any agreement or instrument to which it may be subject or by which it or any of its properties may be bound or any decree, order, judgment, statute, license, rule or regulation, in any of the foregoing cases in a manner that could reasonably be expected to result in the imposition of substantial penalties or materially and adversely affect the financial condition, properties or business of the Borrower or any of its Subsidiaries.

           7.10    Tax Status . The Borrower and its Subsidiaries (a) have made or filed all federal and state income and sales and all other material tax returns, reports and declarations required by any jurisdiction to which any of them is subject, (b) have paid all taxes and other governmental assessments and charges shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and by appropriate proceedings and (c) have set aside on their books provisions reasonably adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Borrower know of no basis for any such claim.

           7.11    No Event of Default . No Default or Event of Default has occurred and is continuing.

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           7.12    Holding Company and Investment Company Acts . Neither the Borrower nor any of its Subsidiaries is a “holding company”, or a “subsidiary company” of a “holding company”, or an “affiliate of a holding company”, as such terms are defined in the Public Utility Holding Company Act of 1935; nor is it an “investment company”, or an “affiliated company” or a “principal underwriter” of an “investment company”, as such terms are defined in the Investment Company Act of 1940.

           7.13    Absence of Financing Statements, etc. Except with respect to Permitted Liens, there is no financing statement, security agreement, chattel mortgage, real estate mortgage or other document filed or recorded with any filing records, registry or other public office, that purports to cover, affect or give notice of any present or possible future lien on, or security interest in, any assets or property of the Borrower or any of its Subsidiaries or any rights relating thereto.

           7.14    Perfection of Security Interest . All filings, assignments, pledges and deposits of documents or instruments have been made and all other actions have been taken that are necessary or advisable, under applicable law, to establish and perfect the Collateral Agent’s security interest in the Collateral. The Collateral and the Collateral Agent’s rights with respect to the Collateral are not subject to any setoff, claims, withholdings or other defenses. The Borrower is the owner of the Collateral free from any lien, security interest, encumbrance and any other claim or demand, except for Permitted Liens.

           7.15    Certain Transactions . Except as set forth on Schedule 7.15 hereto and except for arm’s length transactions pursuant to which the Borrower or any of its Subsidiaries makes payments in the ordinary course of business upon terms no less favorable than the Borrower or such Subsidiary could obtain from third parties, none of the officers, directors, or employees of the Borrower or any of its Subsidiaries is presently a party to any transaction with the Borrower or any of its Subsidiaries (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Borrower, any corporation, partnership, trust or other entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner.

           7.16    Employee Benefit Plans .

                     7.16.1      In General . Each Employee Benefit Plan has been maintained and operated in compliance in all material respects with the provisions of ERISA and, to the extent applicable, the Code, including but not limited to the provisions thereunder respecting prohibited transactions. The Borrower has heretofore delivered to the Agents the most recently completed annual report, Form 5500, with all required attachments, and actuarial statement required to be submitted under Section 103(d) of ERISA, with respect to each Guaranteed Pension Plan.

                     7.16.2      Terminability of Welfare Plans . Under each Employee Benefit Plan which is an employee welfare benefit plan within the meaning of Section 3(1) or Section 3(2)(B) of ERISA, no benefits are payable to employees (or their dependents) after termination of employment (except as required by Title I, Part 6 of ERISA). The Borrower or an ERISA

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Affiliate, as appropriate, may terminate each such Plan at any time (or at any time subsequent to the expiration of any applicable bargaining agreement) in the discretion of the Borrower or such ERISA Affiliate without liability to any Person.

                     7.16.3      Guaranteed Pension Plans . Each contribution required to be made to a Guaranteed Pension Plan, whether required to be made to avoid the incurrence of an accumulated funding deficiency, the notice or lien provisions of Section 302(f) of ERISA, or otherwise, has been timely made. No waiver of an accumulated funding deficiency or extension of amortization periods has been received with respect to any Guaranteed Pension Plan. No liability to the PBGC (other than required insurance premiums, all of which have been paid) has been incurred by the Borrower or any ERISA Affiliate with respect to any Guaranteed Pension Plan and there has not been any ERISA Reportable Event, or any other event or condition which presents a material risk of termination of any Guaranteed Pension Plan by the PBGC. Based on the latest valuation of each Guaranteed Pension Plan (which in each case occurred within twelve months of the date of this representation), and on the actuarial methods and assumptions employed for that valuation, the aggregate benefit liabilities of all such Guaranteed Pension Plans within the meaning of Section 4001 of ERISA did not exceed the aggregate value of the assets of all such Guaranteed Pension Plans, disregarding for this purpose the benefit liabilities and assets of any Guaranteed Pension Plan with assets in excess of benefit liabilities, by more than $500,000.00.

                     7.16.4      Multiemployer Plans . Neither the Borrower nor any ERISA Affiliate has incurred any material liability (including secondary liability) to any Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan under Section 4201 of ERISA or as a result of a sale of assets described in Section 4204 of ERISA. Neither the Borrower nor any ERISA Affiliate has been notified that any Multiemployer Plan is in reorganization or insolvent under and within the meaning of Section 4241 or Section 4245 of ERISA or is at risk of entering reorganization or becoming insolvent, or that any Multiemployer Plan intends to terminate or has been terminated under Section 4041A of ERISA.

           7.17    Regulations U and X . The proceeds of the Loans shall be used for working capital and general corporate purposes. No portion of any Loan is to be used for the purpose of purchasing or carrying any “margin security” or “margin stock” as such terms are used in Regulations U and X of the Board of Governors of the Federal Reserve System, 12 C.F.R. Parts 221 and 224.

           7.18    Environmental Compliance . The Borrower has taken all necessary steps to investigate the past and present condition and usage of the Real Estate and the operations conducted thereon and, based upon such diligent investigation, has determined that:

                     (a)     none of the Borrower, its Subsidiaries or any operator of the Real Estate or any operations thereon is in violation, or alleged violation, of any judgment, decree, order, law, license, rule or regulation pertaining to environmental matters, including without limitation, those arising under the Resource Conservation and Recovery Act (“ RCRA ”), the Comprehensive Environmental Response, Compensation and Liability Act of 1980 as amended (“ CERCLA ”), the Superfund Amendments and Reauthorization Act of 1986 (“ SARA ”), the Federal Clean Water Act, the Federal Clean Air Act, the Toxic Substances Control Act, or any state or local

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statute, regulation, ordinance, order or decree relating to health, safety or the environment (hereinafter “ Environmental Laws ”), which violation would reasonably be expected to have a material adverse effect on the environment or the business, assets or financial condition of the Borrower or any of its Subsidiaries;

                     (b)     neither the Borrower nor any of its Subsidiaries has received notice from any third party including, without limitation, any federal, state or local governmental authority, (i) that any one of them has been identified by the United States Environmental Protection Agency (“ EPA ”) as a potentially responsible party under CERCLA with respect to a site listed on the National Priorities List, 40 C.F.R. Part 300 Appendix B; (ii) that any hazardous waste, as defined by 42 U.S.C. Section 6903(5), any hazardous substances as defined by 42 U.S.C. Section 9601(14), any pollutant or contaminant as defined by 42 U.S.C. Section 9601(33) and any toxic substances, oil or hazardous materials or other chemicals or substances regulated by any Environmental Laws (“ Hazardous Substances ”) which any one of them has generated, transported or disposed of has been found at any site at which a federal, state or local agency or other third party has conducted or has ordered that any Borrower or any of its Subsidiaries conduct a remedial investigation, removal or other response action pursuant to any Environmental Law; or (iii) that it is or shall be a named party to any claim, action, cause of action, complaint, or legal or administrative proceeding (in each case, contingent or otherwise) arising out of any third party’s incurrence of costs, expenses, losses or damages of any kind whatsoever in connection with the release of Hazardous Substances;

                     (c)     except as set forth on Schedule 7.18 attached hereto: (i) no portion of the Real Estate has been used for the handling, processing, storage or disposal of Hazardous Substances except in accordance with applicable Environmental Laws; and no underground tank or other underground storage receptacle for Hazardous Substances is located on any portion of the Real Estate; (ii) in the course of any activities conducted by the Borrower, its Subsidiaries or operators of its properties, no Hazardous Substances have been generated or are being used on the Real Estate except in accordance with applicable Environmental Laws; (iii) there have been no releases (i.e. any past or present releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, disposing or dumping) or threatened releases of Hazardous Substances on, upon, into or from the properties of the Borrower or its Subsidiaries, which releases would have a material adverse effect on the value of any of the Real Estate or adjacent properties or the environment; (iv) to the best of the Borrower’s knowledge, there have been no releases on, upon, from or into any real property in the vicinity of any of the Real Estate which, through soil or groundwater contamination, may have come to be located on, and which would have a material adverse effect on the value of, the Real Estate; and (v) in addition, any Hazardous Substances that have been generated on any of the Real Estate have been transported offsite only by carriers having an identification number issued by the EPA, treated or disposed of only by treatment or disposal facilities maintaining valid permits as required under applicable Environmental Laws, which transporters and facilities have been and are, to the best of the Borrower’s knowledge, operating in compliance with such permits and applicable Environmental Laws; and

                     (d)     None of the Borrower and its Subsidiaries or any of the Real Estate is subject to any applicable environmental law requiring the performance of Hazardous Substances site assessments, or the removal or remediation of Hazardous Substances, or the giving of notice

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to any governmental agency or the recording or delivery to other Persons of an environmental disclosure document or statement by virtue of the transactions set forth herein and contemplated hereby, or as a condition to the effectiveness of any other transactions contemplated hereby.

           7.19    Subsidiaries, etc . Except as set forth on Schedule 7.19 hereto, the Borrower has no Subsidiaries. Except as set forth on Schedule 7.19 hereto, neither the Borrower nor any Subsidiary of the Borrower is engaged in any joint venture or partnership with any other Person.

           7.20    Bank Accounts . Schedule 7.20 (as such may be amended from time to time in accordance with Section 9.9 hereof) sets forth the account numbers and location of all bank accounts of the Borrower or any of its Subsidiaries.

8.      AFFIRMATIVE COVENANTS OF THE BORROWER .

           The Borrower covenants and agrees that, so long as any Loan is outstanding or any Lender has any obligation to make any Loans.

           8.1      Punctual Payment . The Borrower will duly and punctually pay or cause to be paid the principal and interest on the Loans, and all other amounts provided for in this Credit Agreement and the other Loan Documents to which the Borrower or any of its Subsidiaries is a party, all in accordance with the terms of this Credit Agreement and such other Loan Documents.

           8.2      Maintenance of Office . The Borrower will maintain its chief executive office in Chicago, Illinois, or at such other place in the United States of America as the Borrower shall designate upon written notice to the Agents, where notices, presentations and demands to or upon the Borrower in respect of the Loan Documents to which the Borrower is a party may be given or made.

           8.3      Records and Accounts . The Borrower will (a) keep, and cause each of its Subsidiaries to keep, true and accurate records and books of account in which full, true and correct entries will be made in accordance with Generally Accepted Accounting Principles and (b) maintain adequate accounts and reserves for all taxes (including income taxes), depreciation, depletion, obsolescence and amortization of its properties and the properties of its Subsidiaries, contingencies, and other reserves in accordance with Generally Accepted Accounting Principles.

           8.4      Financial Statements, Certificates and Information . The Borrower will deliver to each of the Lenders:

                     (a)     as soon as practicable, but in any event not later than ninety (90) days after the end of each fiscal year of the Borrower, the consolidated balance sheet of the Borrower and its Subsidiaries and the consolidating balance sheet of the Borrower and its Subsidiaries, each as at the end of such year, and the related consolidated statement of income and consolidated statement of cash flow and consolidating statement of income and consolidating statement of cash flow for such year, each setting forth in comparative form the figures for the previous fiscal year and all such consolidated and consolidating statements to be in reasonable detail, prepared in accordance with Generally Accepted Accounting Principles, and certified without qualification by PricewaterhouseCoopers LLP or by another “big four” certified public accounting firm or by other independent certified public accountants satisfactory to the

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Administrative Agent, together with a written statement from such accountants to the effect that they have read a copy of this Credit Agreement, and that, in making the examination necessary to said certification, they have obtained no knowledge of any Default or Event of Default, or, if such accountants shall have obtained knowledge of any then existing Default or Event of Default they shall disclose in such statement any such Default or Event of Default; provided that such accountants shall not be liable to the Lenders for failure to obtain knowledge of any Default or Event of Default;

                     (b)     as soon as practicable, but in any event not later than forty-five (45) days after the end of each of the fiscal quarters of the Borrower, copies of the unaudited consolidated balance sheet of the Borrower and its Subsidiaries and the unaudited consolidating balance sheet of the Borrower and its Subsidiaries, each as at the end of such quarter, and the related consolidated statement of income and consolidated statement of cash flow and consolidating statement of income and consolidating statement of cash flow for the portion of the Borrower’s fiscal year then elapsed, all in reasonable detail and prepared in accordance with Generally Accepted Accounting Principles, together with a certification by the principal financial or accountin