Exhibit 10.3

 

 

PLEDGE AGREEMENT

 

PLEDGE AGREEMENT (this “Agreement”), dated as of April 16, 2020, by and among
Burlington Coat Factory Warehouse Corporation, a Florida corporation (the
“Company”), the entities listed on Schedule I hereto and each of the other
entities that may become a party hereto as provided herein (each of the
foregoing, a “Pledgor” and collectively, the “Pledgors”), and Wilmington Trust,
National Association, in its capacity as collateral agent pursuant to the
Indenture (as hereinafter defined) (in such capacity and together with any
successors in such capacity, the “Collateral Agent”) for its own benefit and the
benefit of the other Secured Parties (as defined herein), in consideration of
the mutual covenants contained herein and benefits to be derived herefrom.

 

WITNESSETH:

 

WHEREAS, reference is made to that certain Indenture, dated as of April 16, 2020
(as amended, modified, supplemented or restated and in effect from time to time,
the “Indenture”, which term shall also include and refer to any additional
issuance of notes under the Indenture), by and between the Company, each
Guarantor, Wilmington Trust, National Association, in its capacity as trustee
(together with its successors in such capacity, the “Trustee”) and the
Collateral Agent for its own benefit and the benefit of the other Secured
Parties, pursuant to which the Company is issuing $300,000,000 aggregate
principal amount of its 6.250% Senior Secured Notes due 2025 (together with any
additional notes issued under the Indenture, the “Senior Secured Notes”); and

 

WHEREAS, reference is also made to the Security Agreement dated as of even date
herewith (as amended, modified, supplemented or restated and in effect from time
to time, the “Security Agreement”), by, among others, the Pledgors and the
Collateral Agent for the Secured Parties, pursuant to which the Pledgors and the
other Grantors named therein have granted a security interest in the Collateral
(as defined in the Security Agreement) to secure the Secured Obligations (as
defined in the Security Agreement); and

 

WHEREAS, from time to time after the date hereof, the Company may, subject to
the terms and conditions of the Indenture and the Collateral Documents, incur
Additional Pari Passu Obligations that the Company desires to secure by the
Collateral (including the Pledged Collateral (as defined below)) on a pari passu
basis with the Senior Secured Notes as further provided in the Security
Agreement; and

 

WHEREAS, this Agreement is made by the Pledgors in favor of the Collateral Agent
for the benefit of the Secured Parties to secure the payment and performance in
full when due of the Secured Obligations.

 

NOW, THEREFORE, in consideration of the mutual conditions and agreements set
forth in this Agreement, and for good and valuable consideration, the receipt of
which is hereby acknowledged, the Pledgors and the Collateral Agent, on its own
behalf and on behalf of the other Secured Parties (and each of their respective
successors or permitted assigns), hereby agree as follows:

 

SECTION 1

Definitions

 

1.1.       Generally. All references herein to the UCC shall mean the Uniform
Commercial Code as in effect from time to time in the State of New York;
provided, however, that if a term is defined in Article 9 of the UCC differently
than in another Article thereof, the term shall have the meaning set forth in
Article 9; provided further that, if by reason of mandatory provisions of law,
perfection, or the effect of perfection or non-perfection, of the security
interest in any Pledged Collateral or the availability of any remedy hereunder
is governed by the Uniform Commercial Code as in effect in a jurisdiction other
than New York, “UCC” means the Uniform Commercial Code as in effect in such
other jurisdiction for purposes of the provisions hereof relating to such
perfection or effect of perfection or non-perfection or availability of such
remedy, as the case may be.

 

 

1.2.       Definitions of Certain Terms Used Herein. Unless the context
otherwise requires, all capitalized terms used but not defined herein shall have
the meanings set forth in the Indenture or Security Agreement (as applicable).
In addition, as used herein, the following terms shall have the following
meanings:

 

“ABL Collateral Agent” shall mean Bank of America, N.A., in its capacity as
Collateral Agent under the ABL Credit Agreement, and its successors and
permitted assigns.

 

“ABL Administrative Agent” shall mean Bank of America, N.A., in its capacity as
Administrative Agent under the ABL Credit Agreement, and its successors and
permitted assigns.

 

“ABL Intercreditor Agreement” shall mean that certain Amended and Restated
Intercreditor Agreement, dated as of April 16, 2020, among the Company, the
other Grantors, the ABL Administrative Agent, the ABL Collateral Agent, the Term
Loan Administrative Agent, the Term Loan Collateral Agent, the Collateral Agent
and each additional agent from time to time party thereto, as amended, restated,
amended and restated, extended, supplemented or otherwise modified from time to
time in accordance with its terms.

 

“Additional Pari Passu Documents” shall have the meaning assigned to such term
in the Pari Passu Intercreditor Agreement.

 

“Additional Pari Passu Obligations” shall have the meaning assigned to such term
in the Pari Passu Intercreditor Agreement.

 

“Additional Pari Passu Secured Party” shall have the meaning assigned to such
term in the Pari Passu Intercreditor Agreement.

 

“Additional Senior Class Debt Representative” shall have the meaning assigned to
such term in the Pari Passu Intercreditor Agreement.

 

“Agreement” shall have the meaning assigned to such term in the preamble of this
Agreement.

 

“Blue Sky Laws” shall have the meaning assigned to such term in Section 7.7 of
this Agreement.

 

“Collateral Agent” shall have the meaning assigned to such term in the preamble
of this Agreement.

 

“Event of Default” shall mean, collectively, any “Event of Default” as defined
in the Indenture or as defined in any Additional Pari Passu Document.

 

- 2 -

 

“Foreign Subsidiary” means any Subsidiary that is organized under the laws of a
jurisdiction other than the United States of America or any State thereof or the
District of Columbia, or any of its territories or possessions.

 

“Guarantors” shall have the meaning assigned to such term in the preliminary
statement of this Agreement.

 

“Indenture” shall have the meaning assigned to such term in the preliminary
statement of this Agreement.

 

“Intercreditor Agreements” shall mean the ABL Intercreditor Agreement and the
Pari Passu Intercreditor Agreement.

 

“Issuer” shall have the meaning assigned to such term in Section 2.1 of this
Agreement.

 

“Pari Passu Intercreditor Agreement” shall mean that certain intercreditor
agreement, dated as of April 16, 2020, by and among the Company, the other
Pledgors, the Collateral Agent, the Term Loan Collateral Agent and the Trustee,
as amended, restated, amended and restated, extended, supplemented or otherwise
modified from time to time in accordance with its terms.

 

“Permitted Disposition” shall mean “Permitted Disposition” as defined in the
Indenture and any corresponding term in any Additional Pari Passu Document.

 

“Permitted Encumbrances” shall mean “Permitted Encumbrances” as defined in the
Indenture and any corresponding term in any Additional Pari Passu Document.

 

“Pledged Collateral” shall have the meaning assigned to such term in Section 2.5
of this Agreement.

 

“Pledged Securities” shall have the meaning assigned to such terms in Section
2.1 of this Agreement.

 

“Pledgor” and “Pledgors” shall have the meaning assigned to such term in the
preamble of this Agreement.

 

“Secured Obligations” shall have the meaning assigned to such term in the
Security Agreement.

 

“Secured Parties” shall have the meaning assigned to such term in the Security
Agreement.

 

“Securities Act” shall have the meaning assigned to such term in Section 7.7 of
this Agreement.

 

“Security Agreement” shall have the meaning assigned to such term in the
preamble of this Agreement.

 

“Term Loan Administrative Agent” shall mean JPMorgan Chase Bank, N.A., as
Administrative Agent under the Term Loan Agreement, and its successors and
permitted assigns.

 

“Term Loan Collateral Agent” shall mean JPMorgan Chase Bank, N.A., as Collateral
Agent under the Term Loan Agreement, and its successors and permitted assigns.

 

- 3 -

 

“Voting Stock” means, with respect to any corporation, the outstanding stock of
all classes (or equivalent interests) which ordinarily, in the absence of
contingencies, entitles holders thereof to vote for the election of directors
(or Persons performing similar functions) of such corporation, even though the
right so to vote has been suspended by the happening of such contingency.

 

1.3.       Rules of Interpretation. The rules of interpretation specified in
Section 1.4 of the Indenture shall be applicable to this Agreement.

 

SECTION 2

Pledge

 

As security for the payment or performance, as the case may be, in full of the
Secured Obligations, each Pledgor hereby pledges unto the Collateral Agent, its
successors and permitted assigns, and hereby grants to the Collateral Agent, its
successors and permitted assigns, for its own benefit and the benefit of the
other Secured Parties, a security interest in such Pledgor’s right, title and
interest in, to and under the following, wherever located, and whether now
existing or hereafter arising or acquired from time to time:

 

2.1.       all shares of capital stock, limited liability company membership
interests and other ownership interests owned by the Pledgor in each entity
designated as an “Issuer” on Schedule II hereto (each an “Issuer” and
collectively, the “Issuers”), and any shares of capital stock, limited liability
company membership interests or other equity interests obtained in the future by
the Pledgor, and the stock certificates or other security certificates (as
defined in the UCC) representing all such shares, membership interests or equity
interests; provided that, with respect to each (a) first-tier Foreign Subsidiary
whose Capital Stock is now or hereafter pledged hereunder by the Pledgor, and
(b) Subsidiary in which substantially all of its assets consist of the Capital
Stock of one or more Foreign Subsidiaries, the Pledgor has pledged or will
pledge stock representing 65% of the outstanding shares of Voting Stock of such
Foreign Subsidiary or Subsidiary, as applicable, (or (i) such lesser percentage
as is owned by Pledgor, or (ii) such greater percentage as is owned by Pledgor
and is permitted by any change in 26 U.S.C. §1ff or other Applicable Law to be
pledged by Pledgor without such pledge resulting in United States income tax
liability with respect to such Foreign Subsidiary or Subsidiary, as applicable)
(the “Pledged Securities”);

 

2.2.       all other Investment Property that may be delivered to, and held by,
the Collateral Agent pursuant to the terms hereof or to the ABL Collateral Agent
or Term Loan Collateral Agent, in each case as agent for, among others, the
Collateral Agent and the Secured Parties, pursuant to the terms of the
applicable Intercreditor Agreement;

 

2.3.       subject to Section 6, all dividends, cash, instruments and other
property from time to time received, receivable or otherwise distributed or
distributable, in respect of, or in exchange for, the Pledged Securities
referred to in clauses 2.1 and 2.2 above;

 

2.4.       subject to Section 6, all rights and privileges of the Pledgor with
respect to the Pledged Securities and other Investment Property referred to in
clauses 2.1, 2.2, and 2.3 above; and

 

2.5.       all proceeds of any of the foregoing (the items referred to in
clauses 2.1 through 2.5 being collectively referred to as the “Pledged
Collateral”).

 

- 4 -

 

TO HAVE AND TO HOLD the Pledged Collateral, together with all right, title,
interest, powers, privileges and preferences pertaining or incidental thereto,
unto the Collateral Agent, its successors and permitted assigns, for its own
benefit and the benefit of the other Secured Parties, until all of the Secured
Obligations (other than contingent indemnification obligations as to which no
claims have been asserted) shall have been paid in full in cash; subject,
however, to the terms, covenants and conditions hereinafter set forth.

 

Upon delivery to the ABL Collateral Agent, the Term Loan Collateral Agent or the
Collateral Agent pursuant to Section 3 of this Agreement, (a) all stock
certificates or other securities now or hereafter included in the Pledged
Securities shall be accompanied by stock powers duly executed in blank or other
instruments of transfer reasonably satisfactory to the ABL Collateral Agent, the
Term Loan Collateral Agent or the Collateral Agent, as applicable, and by such
other instruments and documents as may be reasonably necessary or required or as
the Collateral Agent may reasonably request to perfect or maintain the
perfection of the Collateral Agent’s security interest in the Pledged
Securities, and (b) all other Investment Property consisting of securities and
comprising part of the Pledged Collateral shall be accompanied by proper
instruments of assignment duly executed by the Pledgors and such other
instruments or documents as may be reasonably necessary or required or as the
Collateral Agent may reasonably request to perfect or maintain the perfection of
the Collateral Agent’s security interest in the Investment Property. Each
delivery of Pledged Securities shall be accompanied by a schedule describing the
Pledged Securities theretofore and then being pledged hereunder, which schedule
shall be attached hereto as Schedule II and made a part hereof, as the same may
be supplemented, amended or otherwise modified from time to time in accordance
with the terms of this Agreement. Each schedule so delivered shall supersede any
prior schedules so delivered.

 

SECTION 3

Delivery of the Pledged Collateral

 

3.1.       On or before the Issue Date, each Pledgor shall deliver or cause to
be delivered to the Collateral Agent, as agent for, among others, the Collateral
Agent and the Secured Parties, or the Term Loan Collateral Agent, as bailee of
the Collateral Agent pursuant to the Pari Passu Intercreditor Agreement with
copies to the Collateral Agent, any and all Pledged Securities, any and all
Investment Property, and any and all certificates or other instruments or
documents valued in excess of $1,000,000, if any, representing the Pledged
Collateral.

 

3.2.       After the Issue Date, promptly upon any Pledgor’s obtaining physical
possession of any certificates or other instruments or documents representing
Pledged Securities owned by it, such Pledgor shall deliver or cause to be
delivered such Pledged Collateral to the Collateral Agent or the Term Loan
Collateral Agent, as bailee of the Collateral Agent pursuant to the Pari Passu
Intercreditor Agreement.

 

3.3.       Each Pledgor hereby irrevocably authorizes the Collateral Agent, at
any time and from time to time prior to termination of this Agreement pursuant
to Section 14.1, to sign (if required) and file in any appropriate filing
office, wherever located, any Financing Statement that contains any information
required by the UCC of the applicable jurisdiction for the sufficiency or filing
office acceptance of any Financing Statement. Each Pledgor also authorizes the
Collateral Agent to file a copy of this Agreement in lieu of a Financing
Statement, and to take any and all actions required by any earlier versions of
the UCC which are still in effect or by any other Applicable Law. Each Pledgor
shall provide the Collateral Agent with any information the Collateral Agent
shall reasonably request in connection with any of the foregoing.
Notwithstanding the foregoing authorization to the Collateral Agent, each
Pledgor hereby agrees to prepare and file or cause to be filed, at its own
expense, any Financing Statement, amendment thereto, continuation statement or
other document or instrument, relative to all or any part of the Pledged
Collateral, in the appropriate filing office, wherever located, as is necessary
or required to perfect or maintain the perfection of the Collateral Agent’s
security interest in the Pledged Collateral, and to deliver to the Collateral
Agent a file stamped copy of each such Financing Statement, amendment thereto,
continuation statement or other document or instrument in connection with this
Agreement.

 

- 5 -

 

SECTION 4

Representations, Warranties and Covenants

 

Each Pledgor hereby represents, warrants and covenants, as to itself and the
Pledged Collateral pledged by it hereunder, to and with the Collateral Agent
that:

 

4.1.       as of the date hereof, the Pledged Securities represent that
percentage of the issued and outstanding shares of each class of the capital
stock or other equity interest of the Issuer with respect thereto as set forth
on Schedule II;

 

4.2.       except for the security interest granted hereunder, and except as
otherwise permitted in the Indenture, each Additional Pari Passu Document and
the other Collateral Documents, the Pledgor (i) is and will at all times
continue to be the direct owner, beneficially and of record, of the Pledged
Securities indicated on Schedule II, as the same may be supplemented, amended or
otherwise modified from time to time in accordance with the terms of this
Agreement, (ii) holds the Pledged Collateral free and clear of all Liens, other
than Permitted Encumbrances specified in clauses (a), (e), (i), (l), (r) and
(ee) of the definition thereof in the Indenture, (iii) will make no assignment,
pledge, hypothecation or transfer of, or create or permit to exist any security
interest in, or other Lien on, the Pledged Collateral, other than pursuant
hereto and other than Permitted Encumbrances or in connection with a Permitted
Disposition, and (iv) other than as permitted in Section 6, will cause any and
all distributions in cash or in kind made on the Pledged Collateral to be
promptly deposited with the Collateral Agent and pledged or assigned hereunder;

 

4.3.       except as not prohibited under the Indenture and each Additional Pari
Passu Document, the Pledgor will not consent to or approve the issuance of (a)
any additional shares of any class of capital stock of any Issuer of the Pledged
Securities, or the issuance of any membership or other ownership interest in any
such Person, (b) any securities convertible voluntarily by the holder thereof or
automatically upon the occurrence or nonoccurrence of any event or condition
into, or exchangeable for, any such shares or interests, or (c) any warrants,
options, rights, or other commitments entitling any person to purchase or
otherwise acquire any such shares or interests;

 

4.4.       the Pledgor (i) has the power and authority to pledge the Pledged
Collateral in the manner hereby done or contemplated and (ii) will defend its
title or interest thereto or therein against any and all Liens (other than
Permitted Encumbrances and the Lien created by this Agreement or the other
Collateral Documents), however arising, of all Persons whomsoever;

 

4.5.       except for consents or approvals already obtained, no consent of any
other Person (including stockholders or creditors of the Pledgor), and no
consent or approval of any Governmental Authority or any securities exchange,
was or is necessary to the validity of the pledge effected hereby or to the
disposition of the Pledged Collateral upon an Event of Default in accordance
with the terms of this Agreement and the Security Agreement;

 

4.6.       by virtue of the execution and delivery by the Pledgor of this
Agreement, the filing of Financing Statements pursuant to Section 3.3 above, and
the delivery by the Pledgor to the Collateral Agent, as agent for, among others,
the Collateral Agent and the Secured Parties, or the Term Loan Collateral Agent,
as bailee of the Collateral Agent pursuant to the Pari Passu Intercreditor
Agreement, of the stock certificates or other certificates or documents
representing or evidencing the Pledged Collateral accompanied by stock powers or
endorsements, as applicable, executed in blank in accordance with the terms of
this Agreement, the Collateral Agent will obtain a valid and perfected Lien
upon, and security interest in, the Pledged Collateral as security for the
payment and performance of the Secured Obligations;

 

- 6 -

 

4.7.       the pledge effected hereby is effective to vest in the Collateral
Agent, on its own behalf and on behalf of the other Secured Parties, the rights
of the Collateral Agent in the Pledged Collateral as set forth herein;

 

4.8.       all of the Pledged Securities have been duly authorized and validly
issued and, to the extent applicable, are fully paid and nonassessable;

 

4.9.       all information set forth herein relating to the Pledged Collateral
is accurate and complete in all material respects as of the date hereof; and

 

4.10.     none of the Pledged Securities constitutes margin stock, as defined in
Regulation U of the Board of Governors of the Federal Reserve System.

 

SECTION 5

Registration in Nominee Name; Copies of Notices

 

Subject to the terms of the Pari Passu Intercreditor Agreement, upon the
occurrence and during the continuance of an Event of Default, the Collateral
Agent, on its own behalf and on behalf of the other Secured Parties, shall have
the right (but not the obligation) to hold the Pledged Securities in its own
name as pledgee, the name of its nominee (as pledgee or as sub-agent) or the
name of any Pledgor, endorsed or assigned in blank or in favor of the Collateral
Agent. Each Pledgor will promptly give to the Collateral Agent copies of any
written or electronic notices or other written or electronic communications
received by it with respect to Pledged Securities registered in the name of such
Pledgor.

 

SECTION 6

Voting Rights; Dividends and Interest, Etc.

 

6.1.       Unless and until an Event of Default has occurred and is continuing,
each Pledgor shall be entitled to exercise any and all voting and/or other
consensual rights and powers inuring to an owner of the Pledged Securities or
any part thereof to the extent, and only to the extent, that such rights are
exercised for any purpose not in violation of the terms and conditions of this
Agreement, the Indenture, any Additional Pari Passu Document, the other
Collateral Documents and Applicable Law; provided, however, that such Pledgor
will not be entitled to exercise any such right if the result thereof could
reasonably be expected to materially and adversely affect the rights inuring to
a holder of the Pledged Securities or the rights and remedies of any of the
Secured Parties under this Agreement, the Indenture, any Additional Pari Passu
Document or any other Collateral Document or the ability of the Secured Parties
to exercise the same.

 

- 7 -

 

6.2.       Unless and until a Default or an Event of Default has occurred and is
continuing, each Pledgor shall be entitled to receive and retain any and all
cash dividends or other cash distributions paid on the Pledged Collateral to the
extent, and only to the extent, that such cash dividends or other cash
distributions are permitted by, and otherwise paid in accordance with, the terms
and conditions of this Agreement, the Indenture, any Additional Pari Passu
Document, the other Collateral Documents and Applicable Law. All noncash
dividends, and all dividends paid or payable in cash or otherwise in connection
with a partial or total liquidation or dissolution, return of capital, capital
surplus or paid-in surplus, and all other distributions (other than dividends
and distributions referred to in the preceding sentence) made on or in respect
of the Pledged Collateral, whether paid or payable in cash or otherwise, whether
resulting from a subdivision, combination or reclassification of the outstanding
capital stock or membership interests of the Issuer of any Pledged Securities or
received in exchange for Pledged Securities or any part thereof, or in
redemption thereof, or as a result of any merger, amalgamation, arrangement,
consolidation, acquisition or other exchange of assets to which such Issuer may
be a party or otherwise, shall be and become part of the Pledged Collateral,
and, if received by such Pledgor, to the extent required to be paid to the
Collateral Agent pursuant to the terms of the Indenture, any Additional Pari
Passu Document, any Intercreditor Agreement or any other Collateral Documents,
shall not be commingled by such Pledgor with any of its other funds or property
but shall be held separate and apart therefrom, shall be held in trust for the
benefit of the Collateral Agent and shall, subject to the Pari Passu
Intercreditor Agreement, be promptly delivered to the Collateral Agent in the
same form as so received (with any necessary endorsement).

 

6.3.       After the occurrence and during the continuance of a Default or an
Event of Default, all rights of any Pledgor to dividends or other cash
distributions that such Pledgor is authorized to receive pursuant to Section 6.2
above shall cease, and all such rights shall, subject to the Pari Passu
Intercreditor Agreement, thereupon become vested in the Collateral Agent, which
shall have the sole and exclusive right and authority (but not the obligation)
to receive and retain such dividends or other cash distributions. Any and all
money and other property paid over to or received by the Collateral Agent
pursuant to the provisions of this Section 6.3 shall be applied in accordance
with the provisions of Section 8. After all Defaults or Events of Default have
been cured or waived in writing in accordance with the Indenture or the
applicable Additional Pari Passu Document, without any further action by the
Collateral Agent, each Pledgor will have the right to receive the dividends or
other cash distributions that it would otherwise be entitled to receive pursuant
to the terms of Section 6.2 above.

 

6.4.       After the occurrence and during the continuance of an Event of
Default and upon notice to the Pledgors, all rights of the Pledgors to exercise
the voting and consensual rights and powers it is entitled to exercise pursuant
to Section 6.1 shall cease, and all such rights shall, subject to the Pari Passu
Intercreditor Agreement, thereupon become vested in the Collateral Agent, which
shall have the sole and exclusive right and authority (but not the obligation)
to exercise such voting and consensual rights and powers; provided that the
Collateral Agent shall have the right (but not the obligation) from time to time
following and during the continuance of an Event of Default to permit any
Pledgor to exercise such rights. After all Defaults or Events of Default have
been cured or waived in writing by the Collateral Agent in accordance with the
Indenture or the applicable Additional Pari Passu Document, without any further
action by the Collateral Agent, each Pledgor will have the right to exercise the
voting and consensual rights and powers that it would otherwise be entitled to
exercise pursuant to the terms of Section 6.1 above.

 

SECTION 7

Remedies upon Default

 

After the occurrence and during the continuance of an Event of Default, it is
agreed that the Collateral Agent shall have in any jurisdiction in which
enforcement hereof is sought, in addition to all other rights and remedies, the
rights and remedies of a secured party under the UCC or other Applicable Law.
The rights and remedies of the Collateral Agent shall include, without
limitation and subject to the Intercreditor Agreements, the right (but not the
obligation) to take any or all of the following actions at the same or different
times:

 

- 8 -

 

7.1.       The Collateral Agent may sell or otherwise dispose of all or any part
of the Pledged Collateral, at public or private sale or at any broker’s board or
on any securities exchange, for cash, upon credit or for future delivery as the
Collateral Agent shall deem appropriate. Each purchaser at any such sale shall
hold the property sold absolutely, free from any claim or right on the part of
any Pledgor.

 

7.2.       If required by Applicable Law, the Collateral Agent shall give the
Pledgors at least ten (10) days’ prior written notice, by authenticated record,
of the Collateral Agent’s intention to make any sale of the Pledged Collateral.
Such notice, (i) in the case of a public sale, shall state the date, time and
place for such sale, (ii) in the case of a sale at a broker’s board or on a
securities exchange, shall state the board or exchange at which such sale is to
be made and the day on which the Pledged Collateral, or portion thereof, will
first be offered for sale at such board or exchange, and (iii) in the case of a
private sale, shall state the date after which any private sale or other
disposition of the Pledged Collateral shall be made. Each Pledgor agrees that
such written notice shall satisfy all requirements for notice to the Pledgor
which are imposed under the UCC with respect to the exercise of the Collateral
Agent’s rights and remedies upon default. The Collateral Agent shall not be
obligated to make any sale or other disposition of any Pledged Collateral if it
shall determine not to do so, regardless of the fact that notice of sale or
other disposition of such Pledged Collateral shall have been given. The
Collateral Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for sale, and such sale may, without further notice,
be made at the time and place to which the same was so adjourned.

 

7.3.       Any public sale shall be held at such time or times within ordinary
business hours and at such place or places as the Collateral Agent may fix and
state in the notice of such sale.

 

7.4.       At any public (or, to the extent permitted by Applicable Law,
private) sale made pursuant to this Section 7, the Collateral Agent or any other
Secured Party may bid for or purchase, free (to the extent permitted by
Applicable Law) from any right of redemption, stay, valuation or appraisal on
the part of any Pledgor, the Pledged Collateral or any part thereof offered for
sale and may make payment on account thereof by using any claim then due and
payable to the Collateral Agent or such other Secured Party from any Pledgor on
account of the Secured Obligations as a credit against the purchase price, and
the Collateral Agent or such other Secured Party may, upon compliance with the
terms of sale, hold, retain and dispose of such property without further
accountability to such Pledgor therefor.

 

7.5.       For purposes hereof, a written agreement to purchase the Pledged
Collateral or any portion thereof which is entered into in good faith shall be
treated as a sale thereof. The Collateral Agent shall be free to carry out such
sale pursuant to such agreement and no Pledgor shall be entitled to the return
of the Pledged Collateral or any portion thereof subject thereto,
notwithstanding the fact that after the Collateral Agent shall have entered into
such an agreement all Events of Default shall have been remedied and/or the
Secured Obligations paid in full.

 

7.6.       As an alternative to exercising the power of sale herein conferred
upon it and subject to Applicable Law, the Collateral Agent may proceed by a
suit or suits at law or in equity to foreclose upon the Pledged Collateral and
to sell the Pledged Collateral or any portion thereof pursuant to a judgment or
decree of a court or courts having competent jurisdiction or pursuant to a
proceeding by a court-appointed receiver.

 

- 9 -

 

7.7.       Each Pledgor recognizes that (a) the Collateral Agent may be unable
to effect a public sale of all or a part of the Pledged Collateral by reason of
certain prohibitions contained in the Securities Act of 1933, 15 U.S.C. §77, (as
amended and in effect, the “Securities Act”) or the Securities laws of various
states (the “Blue Sky Laws”), but may be compelled to resort to one or more
private sales to a restricted group of purchasers who will be obliged to agree,
among other things, to acquire the Pledged Collateral for their own account, for
investment and not with a view to the distribution or resale thereof, (b) that
private sales so made may be at prices and upon other terms less favorable to
the seller than if the Pledged Collateral were sold at public sales, (c) that
neither the Collateral Agent nor any other Secured Party has any obligation to
delay sale of any of the Pledged Collateral for the period of time necessary to
permit the Pledged Collateral to be registered for public sale under the
Securities Act or the Blue Sky Laws, and (d) that private sales made under the
foregoing circumstances shall be deemed to have been made in a commercially
reasonable manner.

 

7.8.       To the extent permitted by Applicable Law, each Pledgor hereby waives
all rights of redemption, stay, valuation and appraisal which each Pledgor now
has or may at any time in the future have under any rule of law or statute now
existing or hereafter enacted. In dealing with or disposing of the Pledged
Collateral or any part thereof, neither the Collateral Agent nor any Secured
Party shall be required to give priority or preference to any item of Pledged
Collateral or otherwise to marshal assets or to take possession or sell any
Pledged Collateral with judicial process.

 

SECTION 8

Application of Proceeds of Sale

 

Subject to the Intercreditor Agreements, after the occurrence and during the
continuance of an Event of Default and acceleration of the Secured Obligations
pursuant to the terms of the Indenture or any Additional Pari Passu Document,
the Collateral Agent shall apply the proceeds of any collection or sale of the
Pledged Collateral, as well as any Pledged Collateral consisting of cash, in
accordance with Section 6.02 of the Security Agreement and for all purposes of
this Agreement, the provisions of Section 6.02 of the Security Agreement are
hereby incorporated by reference, mutatis mutandis, as if fully set forth herein
(for the avoidance of doubt, each reference to “Collateral” in Section 6.02 of
the Security Agreement shall also be deemed to be a reference to the Pledged
Collateral).

 

Subject to the Intercreditor Agreements, the Collateral Agent shall have
absolute discretion as to the time of application of any such proceeds, moneys
or balances in accordance with this Agreement. Upon any sale or other
disposition of the Pledged Collateral by the Collateral Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the purchase money by the Collateral Agent or of the officer
making the sale or other disposition shall be a sufficient discharge to the
purchaser or purchasers of the Pledged Collateral so sold or otherwise disposed
of and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Collateral Agent
or such officer or be answerable in any way for the misapplication thereof.

 

SECTION 9

Indemnification

 

Section 7.7 of the Indenture, any corresponding provision in any Additional Pari
Passu Document and Section 8.06 of the Security Agreement are incorporated
herein, mutatis mutandis, as if a part hereof.

 

SECTION 10

Further Assurances

 

Each Pledgor agrees to do such further acts and things, and to execute and
deliver such additional conveyances, assignments, agreements, financing
statements, amendments thereto, continuation statements and instruments, as may
be reasonably necessary or required or as the Collateral Agent may at any time
reasonably request to perfect or maintain the perfection of the Collateral
Agent’s security interest in the Pledged Collateral, in connection with the
administration and enforcement of this Agreement, with respect to the Pledged
Collateral or any part thereof or in order to better assure and confirm the
rights and remedies of the Collateral Agent hereunder.

 

- 10 -

 

SECTION 11

Intent

 

This Agreement is being executed and delivered by the Pledgors for the purpose
of confirming the grant of the security interest of the Collateral Agent in the
Pledged Collateral. It is intended that the security interest granted pursuant
to this Agreement is granted as a supplement to, and not in limitation of, the
security interest granted to the Collateral Agent, for its own benefit and the
benefit of the other Secured Parties, under the Security Agreement. All
provisions of the Security Agreement shall apply to the Pledged Collateral. The
Collateral Agent shall have the same rights, remedies, powers, privileges and
discretions with respect to the security interests created in the Pledged
Collateral as in all other Collateral. In the event of a conflict between this
Agreement and the Security Agreement, the terms of this Agreement shall control
with respect to the Pledged Collateral and the Security Agreement shall control
with respect to all other Collateral. In addition, for all purposes of this
Agreement, the provisions of Sections 8.01, 8.03, 8.04, 8.05, 8.08, 8.10, 8.11,
8.12 and 8.13 of the Security Agreement are hereby incorporated by reference,
mutatis mutandis, as if fully set forth herein (for the avoidance of doubt, each
reference to “Collateral” in these Sections of the Security Agreement shall also
be deemed to be a reference to the Pledged Collateral).

 

Wilmington Trust, National Association is entering into this Agreement solely in
its capacity as Collateral Agent under the Indenture and not in its individual
or corporate capacity. In connection with its execution and acting hereunder,
the Collateral Agent is entitled to all of the rights, privileges, protections,
immunities, benefits and indemnities provided to it under the Indenture and any
corresponding provisions of any Additional Pari Passu Document, as if such
rights, privileges, protections, immunities, benefits and indemnities were set
forth herein.

 

SECTION 12

GOVERNING LAW; WAIVER OF JURY TRIAL

 

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY OTHER COLLATERAL DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY) AND WAIVES DUE DILIGENCE,
DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES THEREOF AS WELL AS NOTICE OF
NONPAYMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVERS, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION 12.

 

- 11 -

 

SECTION 13

Intercreditor Agreements

 

This Agreement and each other Collateral Document are subject to the terms and
conditions set forth in the Intercreditor Agreements in all respects and, in the
event of any conflict between the terms of either Intercreditor Agreement and
this Agreement, the terms of such Intercreditor Agreement shall govern and
control. Notwithstanding anything herein to the contrary, the Lien and security
interest granted to the Collateral Agent pursuant to this Agreement and any
other Collateral Document and the exercise of any right or remedy in respect of
the Collateral by the Collateral Agent hereunder or under any other Collateral
Document are subject to the provisions of the Intercreditor Agreements. Without
limiting the generality of the foregoing, and notwithstanding anything herein to
the contrary, all rights and remedies with respect to the Collateral of the
Collateral Agent (and the Secured Parties) shall be subject to the terms of the
Intercreditor Agreements. Prior to Discharge of ABL Obligations (as defined in
the ABL Intercreditor Agreement), the delivery of any ABL Priority Collateral
(as defined in the ABL Intercreditor Agreement) to the ABL Collateral Agent
pursuant to the ABL Credit Agreement shall satisfy any delivery requirement
under the Indenture, the Notes or hereunder or under any other Collateral
Document with respect to such ABL Priority Collateral to the extent that such
delivery is consistent with the terms of the ABL Intercreditor Agreement, and
the ABL Collateral Agent shall hold such ABL Priority Collateral as bailee for
the Collateral Agent for the purpose of perfecting the Collateral Agent’s
security interest in the ABL Priority Collateral. Prior to the Discharge of
Credit Agreement Obligations (as defined in the Pari Passu Intercreditor
Agreement) that are Credit Agreement Obligations (as defined in the Pari Passu
Intercreditor Agreement), the delivery of any Collateral to the Term Loan
Collateral Agent pursuant to the Term Loan Credit Agreement shall satisfy any
delivery requirement under the Indenture, the Notes or hereunder or under any
other Collateral Document with respect to such Collateral to the extent that
such delivery is consistent with the terms of the Pari Passu Intercreditor
Agreement, and the Term Loan Collateral Agent shall hold such Collateral as
bailee for the Collateral Agent for the purpose of perfecting the Collateral
Agent’s security interest in the Collateral.

 

SECTION 14

Termination; Release of Collateral

 

14.1.       The Liens securing the Senior Secured Notes will be released, in
whole or in part, as provided in Section 10.4 of the Indenture and the Liens
securing Additional Pari Passu Lien Obligations of any series will be released,
in whole or in part, as provided in the Additional Pari Passu Documents
governing such obligations. Upon at least two (2) Business Days’ prior written
request by the Pledgors accompanied by the Officer’s Certificate required by the
Indenture, the Collateral Agent shall, without recourse, representation or
warranty of any kind and at the Pledgors’ sole cost and expense, execute such
documents as the Pledgors may reasonably request to evidence the release of the
Liens upon any Collateral described in this Section 14.1; provided, however,
that (i) the Collateral Agent shall not be required to execute any such document
on terms which, in its reasonable opinion, would, under Applicable Law, expose
the Collateral Agent to liability or create any obligation or entail any adverse
consequence other than the release of such Liens without recourse or warranty
and (ii) such release shall not in any manner discharge, affect or impair the
Secured Obligations or any Liens (other than those expressly being released)
upon (or obligations of any Pledgor in respect of) all interests retained by any
Pledgor, including, without limitation, the proceeds of any sale, all of which
shall continue to constitute part of the Collateral. The security interest
granted herein shall also be released as provided in the Security Agreement.

 

- 12 -

 

14.2.       Except for those provisions which expressly survive the termination
thereof, this Agreement and the security interest granted herein shall terminate
when all of the Secured Obligations (other than contingent indemnity obligations
with respect to then unasserted claims) have been paid in full in cash, at which
time, upon receipt of the Officer’s Certificate and Opinion of Counsel required
by the Indenture, the Collateral Agent shall, without recourse, representation
or warranty of any kind, execute and deliver to the Pledgors, at the Pledgors’
expense, all UCC termination statements and similar documents that the Pledgors
shall reasonably request to evidence such termination; provided, however, that
the Indenture, this Agreement, and the security interest granted herein shall be
reinstated if at any time payment, or any part thereof, of any Secured
Obligation is rescinded or must otherwise be restored by any Secured Party upon
the bankruptcy or reorganization of any Pledgor or any other Loan Party. Any
execution and delivery of termination statements or other documents pursuant to
this Section 14.2 shall be without recourse to, or warranty by, the Collateral
Agent or any other Secured Party.

 

SECTION 15

 

Additional Pledgors

 

If, after the date hereof, pursuant to the terms and conditions of the Indenture
and/or any Additional Pari Passu Document, any Pledgor shall be required to
cause any Subsidiary or other Person to become a party hereto, such Pledgor
shall cause such Person to execute and deliver to the Collateral Agent a joinder
agreement in the form referred to in Section 8.15 of the Security Agreement, and
such Person shall thereafter for all purposes be a party hereto and have the
same rights, benefits and obligations as a Pledgor party hereto and shall be
deemed to have assigned, conveyed, mortgaged, pledged, granted, hypothecated and
transferred to the Collateral Agent, for the benefit of the Secured Parties, the
security interest described in such joinder agreement and Section 2 hereof.

 

[SIGNATURE PAGE FOLLOWS]

 

- 13 -

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement under
seal as of the day and year first above written.

        PLEDGOR: BURLINGTON COAT FACTORY
WAREHOUSE CORPORATION           By: /s/ David Glick     Name: David Glick  
Title: Senior Vice President, Investor Relations and Treasurer

        BURLINGTON COAT FACTORY
HOLDINGS, LLC           By: /s/ David Glick     Name: David Glick     Title:
Senior Vice President, Investor Relations and Treasurer

        BURLINGTON COAT FACTORY
INVESTMENTS HOLDINGS, INC.           By: /s/ David Glick     Name: David Glick  
  Title: Senior Vice President, Investor Relations and Treasurer

        Burlington Coat Factory of Texas, L.P.           By: /s/ David Glick    
Name: David Glick     Title: Senior Vice President, Investor Relations and
Treasurer

        Burlington Coat Factory of Kentucky, Inc.           By: /s/ David Glick
    Name: David Glick     Title: Senior Vice President, Investor Relations and
Treasurer

 

Signature Page to Pledge Agreement

 

 

        BURLINGTON COAT FACTORY DIRECT CORPORATION           By: /s/ David Glick
    Name: David Glick     Title: Senior Vice President, Investor Relations and
Treasurer

        BURLINGTON COAT FACTORY WAREHOUSE OF EDGEWATER PARK, INC.           By:
/s/ David Glick     Name: David Glick     Title: Senior Vice President, Investor
Relations and Treasurer

        Burlington Coat Factory Warehouse of New Jersey, Inc.           By: /s/
David Glick     Name: David Glick     Title: Senior Vice President, Investor
Relations and Treasurer

        BURLINGTON COAT FACTORY OF PUERTO RICO, LLC           By: /s/ David
Glick     Name: David Glick     Title: Senior Vice President, Investor Relations
and Treasurer

        COHOES FASHIONS OF CRANSTON, INC.           By: /s/ David Glick    
Name: David Glick     Title: Senior Vice President, Investor Relations and
Treasurer

 

Signature Page to Pledge Agreement

 

 

        BURLINGTON COAT FACTORY WAREHOUSE OF BAYTOWN INC           By: /s/ David
Glick     Name: David Glick     Title: Senior Vice President, Investor Relations
and Treasurer

        Burlington Coat Factory of Pocono Crossing, LLC           By: /s/ David
Glick     Name: David Glick     Title: Senior Vice President, Investor Relations
and Treasurer

        BURLINGTON COAT FACTORY OF TEXAS, INC.           By: /s/ David Glick    
Name: David Glick     Title: Senior Vice President, Investor Relations and
Treasurer

        BURLINGTON COAT FACTORY REALTY OF EDGEWATER PARK, INC.           By: /s/
David Glick     Name: David Glick     Title: Senior Vice President, Investor
Relations and Treasurer

        BURLINGTON COAT FACTORY REALTY OF PINEBROOK, INC.           By: /s/
David Glick     Name: David Glick     Title: Senior Vice President, Investor
Relations and Treasurer

 

Signature Page to Pledge Agreement

 

        BURLINGTON COAT FACTORY WAREHOUSE OF EDGEWATER PARK URBAN RENEWAL CORP.
          By: /s/ David Glick     Name: David Glick     Title: Senior Vice
President, Investor Relations and Treasurer

        BCF Florence Urban Renewal, L.L.C.           By: /s/ David Glick    
Name: David Glick     Title: Senior Vice President, Investor Relations and
Treasurer

        BCF Florence Urban Renewal II, LLC           By: /s/ David Glick    
Name: David Glick     Title: Senior Vice President, Investor Relations and
Treasurer

        Burlington Merchandising Corporation           By: /s/ David Glick    
Name: David Glick     Title: Senior Vice President, Investor Relations and
Treasurer

 

        Burlington Distribution Corp.           By: /s/ David Glick     Name:
David Glick     Title: Senior Vice President, Investor Relations and Treasurer

 

Signature Page to Pledge Agreement

 

 

      COLLATERAL AGENT: WILMINGTON TRUST, NATIONAL ASSOCIATION, in its capacity
as Collateral Agent         By: /s/ Barry D. Somrock   Name:  Barry D. Somrock
Title: Vice President

  

Signature Page to Pledge Agreement

 

 

SCHEDULE I

 

PLEDGORS’ Names

 

Burlington Coat Factory Holdings, LLC

Burlington Coat Factory Investments Holdings, Inc.

Burlington Distribution Corp. (f/k/a Burlington Distribution of California,
Inc.) 

Burlington Merchandising Corporation 

Burlington Coat Factory Warehouse Corporation 

Burlington Coat Factory of Texas, Inc. 

Burlington Coat Factory of Texas, L.P. 

Burlington Coat Factory of Kentucky, Inc. 

BCF Florence Urban Renewal, L.L.C. 

BCF Florence Urban Renewal II, LLC 

Burlington Coat Factory Direct Corporation 

Burlington Coat Factory Realty of Edgewater Park, Inc. 

Burlington Coat Factory Realty of Pinebrook, Inc. 

Burlington Coat Factory Warehouse of Edgewater Park Urban Renewal Corp. 

Burlington Coat Factory Warehouse of Edgewater Park, Inc. 

Burlington Coat Factory Warehouse of New Jersey, Inc. 

Burlington Coat Factory of Puerto Rico, LLC 

Cohoes Fashions of Cranston, Inc. 

Burlington Coat Factory Warehouse of Baytown Inc 

Burlington Coat Factory of Pocono Crossing, LLC 

 

Signature Page to Pledge Agreement