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 Third Amended and Restated Intercreditor
and Lien Subordination Agreement (as amended or otherwise modified from time to
time , the “Intercreditor Agreement”), dated as of May 21, 2007 between and
among LaSalle Bank National Association, as Administrative Agent on behalf of
the Lenders and the Agents, LaSalle Bank National Association, as the Revolving
Credit Agent, on behalf of the Revolving Credit Lenders and the Revolving Credit
Agent, PWJ Lending LLC, as Agent for the Lenders under the Subordinate Facility,
the Company, and certain other parties thereto and acknowledged by the Borrower,
all as referred to in such Intercreditor Agreement.

NOTE

$7,500,000.00  Dated June 28, 2007 

          FOR VALUE RECEIVED, the undersigned WHITEHALL JEWELERS, INC. (f/k/a
Whitehall Jewellers, Inc.), a Delaware corporation (the “Borrower”), hereby
promises to pay to the order of PWJ LENDING LLC (the “Lender”) at the
Administrative Agent’s Head Office at 623 Fifth Avenue, 32nd Floor, New York,
New York, 10022:

>           (a) prior to or on the Maturity Date the principal amount of Seven
> Million Five Hundred Thousand Dollars ($7,500,000.00); and
> 
>           (b) interest on the principal balance hereof from time to time
> outstanding from the Initial Fourth Additional Loan Funding Date (or in the
> case of PIK Interest, from the date capitalized) under the Second Amended and
> Restated Term Loan Credit Agreement, dated as of February 20, 2007, as amended
> by the First Amendment to the Second Amended and Restated Term Loan Credit
> Agreement, dated as of May 21, 2007 (as amended, restated, supplemented,
> refinanced or otherwise modified from time to time, the “Credit Agreement”),
> among the Borrower, the Lender and the other parties thereto, through and
> including the maturity date hereof at the times and at the rate provided in
> the Credit Agreement.

          This Note evidences borrowings under and has been issued by the
Borrower in accordance with the terms of the Credit Agreement. The Lender and
any holder hereof is entitled to the benefits of the Credit Agreement, the
Security Documents and the other Loan Documents, and may enforce the agreements
of the Borrower contained therein, and any holder hereof may exercise the
respective remedies provided for thereby or otherwise available in respect
thereof, all in accordance with the respective terms thereof. All capitalized
terms used in this Note and not otherwise defined herein shall have the same
meanings herein as in the Credit Agreement.

          The Borrower irrevocably authorizes the Lender to make or cause to be
made, on the Initial Fourth Additional Loan Funding Date and at the time of
receipt of any payment of principal of this Note, an appropriate notation on the
grid attached to this Note, or the continuation of such grid, or any other
similar record, including computer records, reflecting the making of such Loans
or (as the case may be) the receipt of such payment. The outstanding amount of
the Loans set forth on the grid attached to this Note, or the continuation of
such grid, or any other similar record, including computer records, maintained
by the Lender with respect to the Loans shall be prima facie evidence of the
principal amount (including, without limitation,

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all PIK Interest) thereof owing and unpaid to the Lender, but the failure to
record, or any error in so recording, any such amount on any such grid,
continuation or other record shall not limit or otherwise affect the obligation
of the Borrower hereunder or under the Credit Agreement to make payments of
principal of and interest on this Note when due.

          The Borrower has the right in certain circumstances and the obligation
under certain other circumstances to prepay the whole or part of the principal
(including, without limitation, all PIK Interest) of this Note on the terms and
conditions specified in the Credit Agreement.

          This Note is a registered Note and, as provided in and subject to the
terms of the Credit Agreement, is transferable only upon surrender of this Note
for registration of transfer or exchange (and, in the case of a surrender for
registration of transfer, duly endorsed or accompanied by a written instrument
of transfer, duly executed by the registered holder of this Note or his attorney
duly authorized in writing), at which time a new Note for a like principal
amount will be issued to, and registered in the name of, the permitted
transferee. Reference in this Note to a “holder” shall mean the person or entity
in whose name this Note is at the time registered in the register kept by the
Agents as provided in Section 19.3 of the Credit Agreement and, prior to due
presentment for registration of transfer, the Borrower may treat such person or
entity as the owner of this Note for the purpose of receiving payment and for
all other purposes, and the Borrower will not be affected by any notice to the
contrary.

          If any one or more of the Events of Default shall occur, the entire
unpaid principal amount of this Note (including, without limitation, all PIK
Interest) and all of the unpaid interest accrued thereon may become or be
declared due and payable in the manner and with the effect provided in the
Credit Agreement.

          No delay or omission on the part of the Lender or any holder hereof in
exercising any right hereunder shall operate as a waiver of such right or of any
other rights of the Lender or such holder, nor shall any delay, omission or
waiver on any one occasion be deemed a bar or waiver of the same or any other
right on any further occasion.

          The Borrower and every endorser and guarantor of this Note or the
obligation represented hereby waives presentment, demand, notice, protest and
all other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note, and assents to any extension
or postponement of the time of payment or any other indulgence, to any
substitution, exchange or release of collateral and to the addition or release
of any other party or person primarily or secondarily liable.

          THIS NOTE AND THE OBLIGATIONS OF THE BORROWER HEREUNDER SHALL FOR ALL
PURPOSES BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF
NEW YORK (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE
BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS NOTE MAY BE BROUGHT IN
THE COURTS OF THE STATE OF NEW YORK OR ANY FEDERAL COURT SITTING THEREIN AND
CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND THE SERVICE OF
PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS

-2-

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SPECIFIED IN SECTION 20 OF THE CREDIT AGREEMENT. THE BORROWER HEREBY WAIVES ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY
SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.

 

-3-

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          IN WITNESS WHEREOF, the undersigned has caused this Note to be signed
in its corporate name by its duly authorized officer as of the day and year
first above written.

  WHITEHALL JEWELERS, INC. (f/k/a      Whitehall Jewellers, Inc.)              
  By:   /s/ Edward A. Dayoob   Name:    Edward A. Dayoob     Title:    President
and CEO  

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                                Amount of    Balance of            Amount   
Principal Paid    Principal    Notation  Date    of Loans    or Prepaid   
Unpaid    Made By:                                                             
                                                                               
                                                                               
                                                                               
                                                         

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