EXECUTION COPY

RATIFICATION AND REAFFIRMATION AGREEMENT

This RATIFICATION AND REAFFIRMATION AGREEMENT, dated as of January 28, 2008
(this “Agreement”), is made by FOH Holdings, Inc., a Delaware corporation (the
“Parent”), Frederick’s of Hollywood, Inc., a Delaware corporation
(“Frederick’s”), Frederick’s of Hollywood Stores, Inc., a Nevada corporation
(“Stores”), Fredericks.com, Inc., a Nevada corporation (“Fredericks.com”), and
Hollywood Mail Order, LLC, a Nevada limited liability company (“Mail Order”, and
collectively with the Parent, Frederick’s, Stores and Fredericks.com, each
individually an “Existing Obligor”, and collectively the “Existing Obligors”),
for the benefit of Wells Fargo Retail Finance II, LLC, a Delaware limited
liability company, as the arranger and agent for the Lenders referred to below
(in such capacity, together with any successor in such capacity, the “Agent”)
and such Lenders. Capitalized terms used herein but not specifically defined
herein shall have the meanings ascribed to them in the Restated Financing
Agreement referred to below.

WHEREAS, the Parent, Frederick’s, Stores, Mail Order, the lenders from time to
time party thereto (such lenders, together with their respective successors and
assigns the “Lenders”) and the Agent are parties to that certain Financing
Agreement, dated as of January 7, 2003 (as heretofore amended, supplemented or
otherwise modified, the “Existing Agreement”);

WHEREAS, the applicable Existing Obligors have guaranteed and/or secured the
obligations of the Parent, Frederick’s, Stores and Mail Order under the Existing
Agreement, and/or secured their own obligations under any applicable guaranty,
pursuant to the agreements set forth on Annex A attached hereto (such
agreements, as heretofore amended, restated or otherwise modified, each an
“Ancillary Document”, and collectively, the “Ancillary Documents”);

WHEREAS, the terms and provisions of the Existing Agreement shall be amended and
restated in their entirety (the amendment and restatement thereof, the
“Restatement”) as set forth in that certain Amended and Restated Financing
Agreement, dated as of the date hereof (as amended, restated, supplemented or
otherwise modified from time to time, including any replacement agreement
therefor, the “Restated Financing Agreement”), by and among the Agent, the
Lenders, the Parent, Frederick’s, Stores, Mail Order and Frederick’s of
Hollywood Group Inc., a New York corporation (“Group”); and

WHEREAS, the Existing Obligors and Group are mutually dependent on each other in
the conduct of their respective businesses as an integrated operation, with the
credit needed from time to time by one often being provided through financing
obtained by another and the ability to obtain such financing being dependent on
the successful operations of the Existing Obligors and Group as a whole and each
shall benefit directly and indirectly from the extensions of credit under the
Restated Financing Agreement and it is a condition precedent to the
effectiveness of the Restated Financing Agreement that each Existing Obligor
execute and deliver this Agreement for the benefit of the Agent and the Lenders.

 

 

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NOW THEREFORE, in consideration of the premises and for other good and valuable
consideration, the parties hereto hereby agree as follows:

1. Reaffirmation and Confirmation.

(a) Each Existing Obligor hereby absolutely and unconditionally (i) acknowledges
that is has received a copy of the Restated Financing Agreement and ratifies and
reaffirms each Ancillary Document to which it is a party and (ii) acknowledges
and agrees that its obligations under each such Ancillary Document remain in
full force and effect and that it shall continue to comply with, and be subject
to all of the terms, provisions, conditions, covenants, agreements and
obligations thereof notwithstanding the Restatement except that, in each case,
on and after the date hereof, all references in the Ancillary Documents to “the
Financing Agreement,” (or to obligations of the Parent, Frederick’s, Stores and
Mail Order thereunder) “thereto,” “thereof,” “thereunder,” or words of like
import referring to the Existing Agreement shall mean and be references to the
Restated Financing Agreement (and obligations of Group, the Parent, Frederick’s,
Stores, Mail Order and any other parties from time to time made borrowers
thereunder).

2. Ancillary Documents as a Loan Document. Each Existing Obligor hereby further
acknowledges and agrees that this Agreement and each Ancillary Document shall
constitute a “Loan Document” under and as defined in the Restated Financing
Agreement.

3. Consent Not Required. Each Existing Obligor acknowledges and agrees that
neither its consent to, nor acknowledgment of, the Restatement is required
pursuant to the terms of the Ancillary Documents and any failure to obtain such
consent or acknowledgment in connection with any future amendment to or
restatement of the Restated Financing Agreement will not affect the validity of
its obligations under the Ancillary Documents and that this Agreement is being
delivered solely for purposes of form.

4. Representations and Warranties. Each Existing Obligor represents and warrants
that:

(a) the execution, delivery and performance of this Agreement by such Existing
Obligor has been duly authorized by all necessary action;

(b) such Existing Obligor has duly executed and delivered this Agreement;

(c) this Agreement is a legal, valid and binding obligation of such Existing
Obligor, enforceable against such Existing Obligor in accordance with its terms,
except as may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors’ rights
generally and by general equitable principles (whether enforcement is sought by
proceedings at law or in equity);

(d) after giving effect to the Restatement, each Ancillary Document to which it
is a party (A) remains in full force and effect and continues to grant a lien on
or security interest in the property of such Existing Obligor described therein
as security for, or continues to constitute a guaranty of, as the case may be,
the Obligations (under and as defined in the

 

 

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Restated Financing Agreement) pursuant to the terms thereof, and (B) remains the
valid and binding obligation of such Existing Obligor; and

(e) each representation and warranty made by such Existing Obligor in each
Ancillary Document to which it is a party is true and correct in all material
respects as of the date hereof with the same effect as though made as of such
date (except to the extent that such representations and warranties relate
solely to an earlier date).

5. General Provisions.

(a) Counterparts. This Agreement may be executed by one or more of the parties
hereto in any number of separate counterparts and all of such counterparts taken
together shall be deemed to constitute one and the same instrument. Delivery of
an executed counterpart of this Agreement by facsimile or electronic mail shall
be equally effective as delivery of an original executed counterpart.

(b) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE
AND TO BE PERFORMED IN THE STATE OF NEW YORK.

(c) WAIVER OF JURY TRIAL, ETC. EACH EXISTING OBLIGOR HEREBY WAIVES ANY RIGHT TO
A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM CONCERNING ANY RIGHTS
UNDER THIS AGREEMENT, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT,
DOCUMENT OR OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN
CONNECTION HEREWITH, OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN
CONNECTION WITH THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION, PROCEEDINGS OR
COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH EXISTING
OBLIGOR CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF THE
AGENT OR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE AGENT OR
ANY LENDER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM,
SEEK TO ENFORCE THE FOREGOING WAIVERS. EACH EXISTING OBLIGOR HEREBY ACKNOWLEDGES
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS
ENTERING INTO THE RESTATED FINANCING AGREEMENT.

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EXECUTION COPY

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

  

 

 

EXISTING OBLIGORS:

 

 

 

 

 

FOH HOLDINGS, INC.

 

 

 

 

 

By: 

/s/ Linda LoRe

 

 

 

Name: Linda LoRe
Title: President and Chief Executive Officer

 

 

 

FREDERICK’S OF HOLLYWOOD, INC.

 

 

 

 

 

By: 

/s/ Linda LoRe

 

 

 

Name: Linda LoRe
Title: President and Chief Executive Officer

 

 

 

FREDERICK’S OF HOLLYWOOD STORES, INC.

 

 

 

 

 

By: 

/s/ Linda LoRe

 

 

 

Name: Linda LoRe
Title: President and Chief Executive Officer

 

 

 

FREDERICKS.COM, INC.

 

 

 

 

 

By: 

/s/ Linda LoRe

 

 

 

Name: Linda LoRe
Title: President and Chief Executive Officer

 

 

 

HOLLYWOOD MAIL ORDER, LLC

 

 

 

 

 

By: FOH Holdings, Inc., its Manager

 

 

 

 

 

 

 

By: 

/s/ Linda LoRe

 

 

 

 

Name: Linda LoRe
Title: President and Chief Executive Officer

 

  

Acknowledged and Accepted to as of
the date first above-written.

 

 

 

 

 

WELLS FARGO RETAIL FINANCE II, LLC
as Agent

 

 

 

 

 

By: 

/s/ Jennifer Cann

 

 

 

 

Name: Jennifer Cann
Title: Senior Vice President

 

 

 

 

 

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ANNEX A

Ancillary Documents

1.

Guaranty Agreement, dated as of January 7, 2003 (as heretofore amended,
restated, supplemented or otherwise modified), by Fredericks.com in favor of the
Agent.

2.

Security Agreement, dated as of January 7, 2003 (as heretofore amended,
restated, supplemented or otherwise modified), by the Parent, Frederick’s,
Stores and Mail Order in favor of the Agent;

3.

Assignment for Security (Trademarks), dated as of January 7, 2003 (as heretofore
amended, restated, supplemented or otherwise modified), by Frederick’s in favor
of the Agent.

4.

Assignment for Security (Copyrights) (Hollywood Mail Order, LLC), dated as of
January 7, 2003 (as heretofore amended, restated, supplemented or otherwise
modified), by Mail Order in favor of the Agent

5.

Restricted Account Agreement, dated as of December 23, 2002 (as heretofore
amended, restated, supplemented or otherwise modified), by Wells Fargo Bank,
National Association, Frederick’s and the Agent.

6.

Restricted Account Agreement, dated as of December 23, 2002 (as heretofore
amended, restated, supplemented or otherwise modified), by Wells Fargo Bank,
National Association, Frederick’s and the Agent.

7.

Pledge Agreement, dated as of January 7, 2003 (as heretofore amended, restated,
supplemented or otherwise modified), by the Parent, Frederick’s, Stores and Mail
Order in favor of the Agent.

8.

Intercreditor and Subordination Agreement, dated as of January 7, 2003 (as
heretofore amended, restated, supplemented or otherwise modified from time to
time), by Existing Obligors in favor of the Agent.

9.

Landlord’s Waiver and Consent, dated as of June 30, 2003 (as heretofore amended,
restated, supplemented or otherwise modified), by Ryan Companies US, Inc. and
Frederick’s in favor of the Agent.

 

 

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