Exhibit 10.5

GUARANTY

THIS GUARANTY (“Guaranty”) is effective as of May 31, 2017 by bebe management,
inc., a Virginia corporation, bebe stores (Canada), inc., a California
corporation, bebe studio, inc., a California corporation, and bebe studio
realty, LLC, a California limited liability company (each a “Guarantor” and
collectively, the “Guarantors”), in favor of GACP Finance Co., LLC, a Delaware
limited liability company, as administrative agent (in such capacity,
“Administrative Agent”) for the Lenders from time to time party to the Loan
Agreement referred to below. Capitalized terms not otherwise defined herein
shall have the meaning given such terms in the Loan Agreement.

W I T N E S S E T H:

WHEREAS, bebe stores, inc., a California corporation (“Parent” or “Borrower”),
desires to obtain $35 million in term loan financing to facilitate the closing
of leasing arrangements with landlords and for operating capital for itself and
its Subsidiaries;

WHEREAS, to obtain such financing, Parent desires to enter into that certain
Loan and Security Agreement of even date among Parent, the Lenders from time to
time party thereto, and Administrative Agent (as amended, restated or replaced
from time to time, the “Loan Agreement”);

WHEREAS, Guarantors are all of the Subsidiaries that are directly or indirectly
wholly-owned by Parent;

WHEREAS, it is a condition precedent to the effectiveness of the Loan Agreement
that Guarantors guaranty the Obligations under the Loan Agreement and the other
Loan Documents and that all real estate assets and personalty related thereto,
certain equity interests and certain deposit accounts owned by Borrower or any
Guarantor be pledged to Administrative Agent for the benefit of the Lenders;

WHEREAS, Guarantors will derive substantial direct and indirect benefits from
the Loans, and to induce Lenders to enter into the Loan Agreement and advance
Loans thereunder have agreed to execute and deliver this Guaranty; and

WHEREAS, this Guaranty and the Guaranteed Obligations will be secured by the
Mortgaged Property pledged by bebe studio realty, LLC, as described in the Loan
Agreement and the Mortgages;

NOW THEREFORE, for valuable consideration and as an inducement to the Lenders
and Administrative Agent to enter into the Loan Agreement and to make the Loans,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, each Guarantor covenants with the Administrative
Agent as follows:

1. Subject to the provisions hereof, each Guarantor hereby absolutely and
unconditionally, jointly and severally, guarantees to the Administrative Agent
for itself and for the ratable benefit of the Lenders (each a “Guaranteed Party”
and collectively the “Guarantied Parties”) the full and timely payment and
performance of all Obligations of Borrower to the Guaranteed Parties, together
with all Expenses pertaining to the enforcement hereof against any Guarantor or
any Collateral (such Obligations are, collectively, the “Guaranteed
Obligations”).

 

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2. Without limiting the generality of the guarantee set forth in Section 1, each
Guarantor covenants to the Administrative Agent that if, Borrower fails to pay
to the Guaranteed Parties all or any portion of the Guaranteed Obligations when
and as due in accordance with the Loan Agreement and the other Loan Documents,
such Guarantor shall pay in Borrower’s stead, or cause the payment of, such
Guaranteed Obligations to the Administrative Agent for the benefit of the
Guaranteed Parties at the times and in the manner set forth in Section 3 below.

3. All payments by each Guarantor to the Administrative Agent (i) shall be made
in the United States, in United States Dollars, and to such account or accounts
as the Administrative Agent may direct, (ii) shall be paid within one
(1) Business Day after receipt by Guarantor from the Administrative Agent of
written demand for such payment, and (iii) shall not be the subject of any
offset against any amounts which may be owed by the Administrative Agent or any
other Guaranteed Party to any Guarantor or Borrower; provided, however, that in
the event of an Insolvency Proceeding of Borrower or any Guarantor all
Guaranteed Obligations shall automatically become due and payable without
written demand. Each and every Event of Default under the Loan Agreement shall
give rise to a separate liability of Borrower to the Guaranteed Parties and a
separate cause of action hereunder and a separate suit may be brought hereunder
as each liability or cause of action arises, or such Defaults may be pursued
collectively, all at the election of the Guaranteed Parties.

4. Each Guarantor agrees that the obligations of Guarantors under this Guaranty
are irrevocable, absolute and unconditional, shall not be affected by any
circumstance that constitutes a legal or equitable discharge of a guarantor or
surety other than the payment and performance in full (other than any indemnity
obligation for unasserted claims that by its terms survive the termination of
this Guaranty) of the Guaranteed Obligations as provided herein. The obligations
of each Guarantor shall not be affected, modified or impaired or prejudiced
(a) by any security now or hereafter held by any Guaranteed Party as security
for the obligations of Borrower under the Loan Agreement and the other Loan
Documents or (b) upon the happening from time to time of any one or more of the
following, whether or not with notice to or consent of Borrower (except to the
extent that Borrower’s consent may be required to effectuate a modification of
the Loan Agreement or any other Loan Document) or Guarantors or any of them:

(i) the compromise, settlement, release, change, modification, waiver or
termination of any of the covenants, terms or agreements of Borrower or any
Guarantor set forth in any Loan Document (whether material or otherwise);

(ii) the waiver by any Guaranteed Party of the payment, performance or
observance of any of the covenants, terms or agreements of Borrower or any
Guarantor set forth in any Loan Document;

(iii) any extension of the time of payment, observance or performance of, any
release, composition or settlement (whether by way of acceptance of a plan of
reorganization or otherwise) of, any subordination (whether present or future or
contractual or otherwise) of, terms or agreements of Borrower or any Guarantor
set forth in any Loan Document;

 

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(iv) the failure, omission, waiver, forbearance, delay or other indulgence on
the part of any Guaranteed Party to enforce, ascertain or exercise any right,
power or remedy under or pursuant to the terms of any Loan Document, including
any election or failure to exercise any right of set-off, recoupment or
counterclaim, and any election of remedies effected by the Administrative Agent
or such Guaranteed Party;

(v) the bankruptcy, insolvency, winding up, dissolution, liquidation,
administration, reorganization or other failure or financial disability of
Borrower or any Guarantor, or any legal limitation, disability, incapacity or
other circumstances relating to Borrower or any Guarantor;

(vi) the addition, substitution or partial or entire release of Borrower, any
Guarantor, or any other Person primarily or secondarily liable or responsible
for the performance and observance of any of the covenants, terms or agreements
set forth in any Loan Document;

(vii) the compromise or settlement of any of the terms and provisions of, or any
discharge, disallowance, invalidity, illegality, voidness or other
unenforceability of any Guaranteed Obligations;

(viii) the partial or entire release of any security for any of the Guaranteed
Obligations or the neglect to perfect or enforce any security; and

(ix) ANY OTHER ACT OR FAILURE TO ACT OR ANY OTHER EVENT OR CIRCUMSTANCE THAT
(A) VARIES THE RISK OF ANY GUARANTOR HEREUNDER OR (B) BUT FOR THE PROVISIONS
HEREOF, WOULD, AS A MATTER OF STATUTE OR RULE OF LAW OR EQUITY, OPERATE TO
REDUCE, LIMIT OR TERMINATE THE OBLIGATIONS OF ANY GUARANTOR HEREUNDER OR
DISCHARGE ANY GUARANTOR FROM ANY THEREOF.

5. Each Guarantor irrevocably and absolutely waives any and all right of
subrogation, contribution, indemnification, reimbursement or similar rights
against Borrower with respect to this Guaranty until the payment, performance or
satisfaction of the Guaranteed Obligations in full (other than any indemnity
obligation for unasserted claims that by its terms survive the termination of
this Guaranty), whether such rights arise under an express or implied contract
or by operation of law, it being the intention of Guarantor and the Guaranteed
Parties that Guarantor shall not be deemed to be a “creditor” (as defined in
Section 101 of the Bankruptcy Code or any other applicable law) of Borrower by
reason of the existence of this Guaranty in the event that Borrower becomes a
debtor in any proceeding under the Bankruptcy Code or any other applicable Law.
In addition, no Guarantor shall exercise any rights of subrogation which
Guarantor may acquire under this Guaranty, by any payment made hereunder or
otherwise, until all of the liabilities and obligations of Borrower to the
Guaranteed Parties under the Loan Documents shall have been paid and performed
in full (other than any indemnity obligation for unasserted claims that by its
terms survive the termination of this Guaranty). If

 

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any amount shall be paid to Guarantor on account of such subrogation rights at
any time when all such liabilities and obligations shall not have been paid
(other than any indemnity obligation for unasserted claims that by its terms
survive the termination of this Guaranty), such amount shall be held in trust
for the Administrative Agent on behalf of the Guaranteed Parties and shall
forthwith be paid to the Administrative Agent for the benefit of the Guaranteed
Parties and applied to such liabilities and obligations, whether matured or
unmatured.

6. The Administrative Agent may enforce against any Guarantor any and all of the
rights of the Guarantied Parties under this Guaranty without having instituted
or completed any legal, arbitration or other proceedings against Borrower or any
other Guarantor. The Administrative Agent shall have the right, in its sole
judgment and discretion, from time to time, to make demand for payment and
performance and to proceed against any Guarantor for recovery of the total of
any and all amounts due to the Guarantied Parties pursuant to this Guaranty as
and when the same are due under the terms hereof, or to proceed from time to
time against Guarantors for such portion of any or all such amounts.

7. The obligations of Guarantors under this Guaranty shall not be altered,
limited or affected by any proceeding, voluntary or involuntary, involving the
winding up, dissolution, administration, bankruptcy, reorganization, insolvency,
receivership, liquidation or arrangement or similar proceeding of Borrower or
any other Guarantor, or by any defense which Borrower or any other Guarantor may
have by reason of any order, decree or decision of any court or administrative
body resulting from any such proceeding.

8. With respect to all Guaranteed Obligations, this is a guarantee of payment
and not of collection, and each Guarantor hereby waives and relinquishes all
rights and remedies accorded by applicable law to sureties or guarantors and
agrees not to assert or take advantage of any such rights or remedies, including
without limitation:

(a) any right to require any Guaranteed Party to proceed against Borrower, any
Guarantor or any other person or to proceed against or exhaust any security held
by any Guaranteed Party at any time or to pursue any other remedy in any
Guaranteed Party’s power before proceeding against any Guarantor;

(b) any defense that may arise by reason of the incapacity, lack of authority,
death or disability of any other person or the failure of any Guaranteed Party
to file or enforce a claim against the estate (in administration, bankruptcy or
any other proceeding) of any other Person;

(c) demand, presentment, protest, diligence, and notice of any kind, including
without limitation notice of default, demand, dishonor, presentment, protest, or
the existence, creation or incurring of any new or additional indebtedness or
obligation or of any action or non-action on the part of Borrower, any
Guaranteed Party, any creditor of Borrower or any Guarantor or on the part of
any other Person under this Guaranty or any other instrument or agreement in
connection with any obligation or evidence of indebtedness held by any
Guaranteed Party as collateral or in connection with the Guaranteed Obligations;

 

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(d) any defense based upon an election of remedies by any Guaranteed Party which
destroys or otherwise impairs the subrogation rights of Guarantors, the right of
Guarantors to proceed against Borrower or any other Guarantor for reimbursement;

(e) any duty on the part of any Guaranteed Party to disclose to Guarantors any
facts the Administrative Agent or any other Guaranteed Party may now or
hereafter know, regardless of whether a Guaranteed Party has reason to believe
that any such facts materially increase the risk beyond that which Guarantors
intends to assume, or has reason to believe that such facts are unknown to any
Guarantor, or has a reasonable opportunity to communicate such facts to
Guarantors, since each Guarantor acknowledges that it is fully responsible for
being and keeping informed of the financial condition of Borrower or any other
Guarantor and of all circumstances bearing on the risk of non-payment by
Borrower of its obligations under any Loan Document;

(f) any defense arising because of any Guaranteed Party’s election, in any
proceeding instituted under the Bankruptcy Code, of the application of
Section 1111(b)(2) of the Bankruptcy Code; and

(g) any defense based upon any borrowing or grant of a security interest or use
of cash collateral under Section 364 of the Bankruptcy Code.

9. Each Guarantor represents, covenants, and agrees that:

(a) Guarantor has derived or expects to derive a financial or other benefit or
advantage from the extensions of Loans and any other credit and other financial
accommodations provided to Borrower by the Guaranteed Parties under the Loan
Agreement and the other Loan Documents;

(b) Guarantor has (i) the corporate or limited liability company power and
authority to execute and deliver this Guaranty and to perform the obligations of
Guarantor, (ii) taken all necessary corporate or limited liability company
action to authorize this Guaranty and the performance by Guarantor of its
obligations hereunder, and (iii) the legal right to own its property and to
carry on its business as presently conducted or proposed to be conducted;

(c) this Guaranty has been duly executed and delivered by Guarantor and this
Guaranty is the legal, valid and binding obligation of Guarantor, enforceable
against Guarantor in accordance with its terms, subject to the application of
bankruptcy and similar laws and of general equitable principles;

(d) the execution, delivery and performance of this Guaranty do not (and, to
Guarantor’s knowledge will not), violate (i) any Organic Documents of Guarantor,
(ii) any applicable provision of law, except to the extent that such violation
could not reasonably be expected to have a Material Adverse Effect, or (iii) any
agreement, instrument, indenture, deed or undertaking to which Guarantor is a
party or by which Guarantor or any of its property is bound, except to the
extent that such violation could not reasonably be expected to have a Material
Adverse Effect;

 

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(e) such Guarantor has obtained all Necessary Authorizations, and all such
Necessary Authorizations are in full force and effect, except for (i) filings
and recordings with respect to the Collateral to be made or delivered to
Administrative Agent for filing or recording and (ii) those Necessary
Authorizations, the failure of which to obtain or make could not reasonably be
expected to have a Material Adverse Effect;

(f) no litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the undersigned’s knowledge, threatened
by or against Guarantor or any of its properties which, if adversely determined,
could be reasonably likely to have a Material Adverse Effect; and

(g) Guarantor has established adequate means of obtaining financial and other
information pertaining to the business, operations and condition (financial or
otherwise) of Borrower and its properties on a continuing basis, and Guarantor
is and hereafter will be completely familiar with the business, operations and
condition (financial and otherwise) of Borrower and its respective properties.

10. Each Guarantor further covenants and agrees that:

(a) Guarantor will adhere to and comply with all representations, warranties and
covenants applicable to any Subsidiary of Borrower under each Loan Document; and

(b) Promptly (and in any event within three (3) Business Days) upon each
reasonable request from Administrative Agent or any Lender, Guarantor will
deliver such data, certificates, reports, statements, documents or further
information regarding the business, assets, liabilities, financial position,
projections, results of operations or business prospects of such Guarantor.

11. Subject to the provisions of this Section, this Guaranty and all obligations
of Guarantor hereunder shall automatically terminate upon the date upon which
all Guaranteed Obligations (other than contingent obligations for which no claim
has been asserted) have been paid and performed in full (the “Termination
Date”). If all of the Equity Interests or any asset of any Guarantor is sold or
otherwise disposed of in accordance with the terms of the Loan Agreement or any
other Loan Document after the date hereof, Administrative Agent shall, at the
request and sole expense of any Guarantor following any such termination, sale
or disposition, execute and deliver to such Guarantor such documents as such
Guarantor shall reasonably request to evidence such termination, sale or
release. Notwithstanding the foregoing, this Guaranty shall be reinstated if at
any time following the Termination Date (a) any payment by any Guarantor under
or pursuant to this Guaranty or (b) any payment by Borrower under or pursuant to
the Loan Agreement or any other Loan Document, in each case made prior to the
Termination Date, is rescinded or must otherwise be returned by the Lender upon
the insolvency, bankruptcy, reorganization, dissolution or liquidation of
Borrower, Guarantor or any other Person, all as though such payment had not been
made. Such period of reinstatement shall continue until satisfaction of the
conditions contained in, and shall continue to be subject to, the provisions of
this Guaranty.

 

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12. Contribution and Indemnity.

(a) Joint and Several Liability. All Obligations of Guarantors under this
Guaranty and the other Loan Documents shall be joint and several Obligations of
each Guarantor. Anything contained in this Guaranty and the other Loan Documents
to the contrary notwithstanding, the Obligations of each Guarantor hereunder,
solely to the extent that such Guarantor did not receive proceeds of Loans from
any borrowing under the Loan Agreement, shall be limited to a maximum aggregate
amount equal to the largest amount that would not render its Obligations
hereunder subject to avoidance as a fraudulent transfer or conveyance under
Section 548 of the Bankruptcy Code, 11 U.S.C. § 548, or any applicable
provisions of comparable state law (collectively, the “Fraudulent Transfer
Laws”), in each case after giving effect to all other liabilities of such
Guarantor, contingent or otherwise, that are relevant under the Fraudulent
Transfer Laws (specifically excluding, however, any liabilities of such
Guarantor in respect of intercompany Indebtedness to any other Obligor or
Affiliates of any other Obligor to the extent that such Indebtedness would be
discharged in an amount equal to the amount paid by such Obligor hereunder) and
after giving effect as assets to the value (as determined under the applicable
provisions of the Fraudulent Transfer Laws) of any rights to subrogation or
contribution of such Guarantor pursuant to (i) applicable law or (ii) any
agreement providing for an equitable allocation among such Guarantor and other
Affiliates of any Obligor of Obligations arising under guaranties by such
parties.

(b) Subrogation. Until the Obligations (other than contingent indemnification
obligations for which no claim has been made) shall have been paid in full in
cash or immediately available funds, each Guarantor shall withhold exercise of
any right of subrogation, contribution or any other right to enforce any remedy
which it now has or may hereafter have against the other Guarantor or any other
guarantor of the Obligations. Each Guarantor further agrees that, to the extent
the waiver of its rights of subrogation, contribution and remedies as set forth
herein is found by a court of competent jurisdiction to be void or voidable for
any reason, any such rights such Guarantor may have against each other Guarantor
or any collateral pledged by or assets of each other Guarantor shall be junior
and subordinate to any rights Administrative Agent may have against the other
Guarantors and any such collateral or assets. Guarantors under this Guaranty and
the other Loan Documents together desire to allocate among themselves, in a fair
and equitable manner, their Obligations arising under this Guaranty and the
other Loan Documents. Accordingly, in the event any payment or distribution is
made on any date by any Guarantor under this Guaranty and the other Loan
Documents (a “Funding Guarantor”) that exceeds its Obligation Fair Share (as
defined below) as of such date, that Funding Guarantor shall be entitled to a
contribution from the other Guarantor in the amount of such other Guarantors’
Obligation Fair Share Shortfall (as defined below) as of such date, with the
result that all such contributions will cause Guarantors’ Obligation Aggregate
Payments (as defined below) to equal its Obligation Fair Share as of such date.

(c) Definitions.

“Obligation Fair Share” means, with respect to a Guarantor as of any date of
determination, an amount equal to (i) the ratio of (X) the Obligation Fair Share
Contribution Amount (as defined below) with respect to such Guarantor to (Y) the
aggregate of the Obligation Fair Share Contribution Amounts with respect to all
Guarantors, multiplied by (ii) the aggregate amount paid or distributed on or
before such date by all Funding Guarantors under this Guaranty and the other
Loan Documents in respect of the Obligations guarantied.

 

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“Obligation Fair Share Shortfall” means, with respect to a Guarantor as of any
date of determination, the excess, if any, of the Obligation Fair Share of such
Guarantor over the Obligation Aggregate Payments of such Guarantor.

“Obligation Fair Share Contribution Amount” means, with respect to a Guarantor
as of any date of determination, the maximum aggregate amount of the Obligations
of such Guarantor under this Guaranty and the other Loan Documents that would
not render its Obligations hereunder or thereunder subject to avoidance as a
fraudulent transfer or conveyance under Section 548 of Title 11 of the United
States Code or any comparable applicable provisions of state law; provided,
that, solely for purposes of calculating the Obligation Fair Share Contribution
Amount with respect to any Guarantor for purposes of this Section of this
Guaranty, any assets or liabilities of such Obligor arising by virtue of any
rights to subrogation, reimbursement or indemnification or any rights to or
Obligations of contribution hereunder shall not be considered as assets or
liabilities of such Guarantor.

“Obligation Aggregate Payments” means, with respect to a Guarantor as of any
date of determination, an amount equal to (i) the aggregate amount of all
payments and distributions made on or before such date by such Guarantor in
respect of this Guaranty and the other Loan Documents (including in respect of
this Section 12) minus (ii) the aggregate amount of all payments received on or
before such date by such Guarantor from the other Guarantor as contributions
under this Section 12. The amounts payable as contributions hereunder shall be
determined as of the date on which the related payment or distribution is made
by the applicable Funding Guarantor. The allocation among Guarantors of their
Obligations as set forth in this Section 12 shall not be construed in any way to
limit the liability of any Guarantor hereunder or under any Loan Document.

13. Indemnity. Each Guarantor hereby agrees to indemnify and defend the
Indemnitees against and to hold the Indemnitees harmless from any Indemnified
Claim that may be instituted or asserted against or incurred by any of the
Indemnitees; provided that any legal fees and expenses that shall be reimbursed
shall be limited to the reasonable and documented fees, charges and
disbursements of one counsel to all Indemnitees taken as a whole and, if
reasonably necessary, a single local counsel for all Indemnitees taken as a
whole in each relevant jurisdiction and solely in the case of an actual conflict
of interest between Indemnitees where the Indemnitees affected by such conflict
inform the Borrower or such Guarantor of such conflict, one additional counsel
in each relevant jurisdiction material to the interest of the Lenders to each
group of affected Indemnitees taken as a whole. Without limiting the generality
of the foregoing, this indemnity shall extend to any Indemnified Claims
instituted or asserted against or incurred by any of the Indemnitees under any
Environmental Laws. The foregoing indemnities shall not apply to (a) Indemnified
Claims incurred by any Indemnitee as a result of its own gross negligence or
willful misconduct as determined by a final non-appealable order of a court of
competent jurisdiction, (b) Indemnified Claims brought by the Borrower or any
Guarantor against an Indemnitee for breach in bad faith of such Indemnitee’s
obligations hereunder or under any other Loan Document, if the Borrower or such
Guarantor has obtained a final and nonappealable judgment in its favor on such
claim as determined by a court of competent

 

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jurisdiction, or (c) result from the presence, release or threat of release of
Hazardous Materials or violations of Environmental Laws first occurring or first
existing after completion of the foreclosure upon the Collateral, granting of a
deed-in-lieu of foreclosure with respect to the Collateral or similar transfer
of title or possession of the Collateral, unless such presence, release or
violation is actually caused by any Obligor thereof. Notwithstanding anything to
the contrary in any of the Loan Documents, the obligations of such Guarantor
with respect to each indemnity given by it in this Guaranty or any of the other
Loan Documents in favor of Administrative Agent and each Lender shall survive
the payment in full of the Obligations.

14. Unless otherwise expressly provided herein, all notices and other
communications provided for hereunder shall be in writing and mailed, sent by a
nationally recognized overnight courier or delivered, to the address or, subject
to the last sentence hereof, electronic mail address specified on Schedule I
hereto or to such other address as shall be designated by such party in a notice
to the other parties. All such other notices and other communications shall be
deemed to have been given or made upon the earliest to occur of (a) actual
receipt by the intended recipient or (b)(i) if delivered by hand or courier,
when signed for by the designated recipient; (ii) if delivered by mail, four
(4) Business Days after deposit in the mail, postage prepaid; (iii) if delivered
by a nationally recognized overnight courier, one (1) Business Day after the
date on which such notice or communication is deposited with such overnight
courier; and (iv) if delivered by electronic mail (which form of delivery is
subject to the provisions of the last sentence below), when delivered; provided,
however, that notices and other communications pursuant to Section 3 shall not
be effective until actually received by Guarantied Parties. Electronic mail and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information, and to distribute Loan Documents for
execution by the parties thereto, and may not be used for any other purpose.

15. This Guaranty shall inure to the benefit of and be binding upon the parties
hereto and their respective successors and permitted assigns; this Guaranty is
not assignable except in accordance with the assignment of Loan Documents
generally under the Loan Agreement.

16. THIS GUARANTY SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO
PRINCIPLES OF CONFLICT OF LAWS (OTHER THAN SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW).

17. Each Guarantor hereby consents to the non-exclusive jurisdiction of any
United States federal court sitting in or with direct or indirect jurisdiction
over the Borough of Manhattan or any state or superior court sitting in the
Borough of Manhattan, in any action, suit or other proceeding arising out of or
relating to this Guaranty or any of the other Loan Documents; and irrevocably
agrees that all claims and demands in respect of any such action, suit or
proceeding involving any Obligor pertaining to this Guaranty or any Loan
Document may be heard and determined in any such court and irrevocably waives
any objection it may now or hereafter have as to the venue of any such action,
suit or proceeding brought in any such court or that such court is an
inconvenient forum. Administrative Agent reserves the right to bring proceedings
against any Guarantor in the courts of any other jurisdiction. Nothing in this
Guaranty or any other Loan Document

 

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shall be deemed or operate to affect the right of the Administrative Agent to
serve legal process in any other manner permitted by law or to preclude the
enforcement by the Administrative Agent of any judgment or order obtained in
such forum or the taking of any action under this Guaranty or any other Loan
Document to enforce same in any other appropriate forum or jurisdiction.

18. GUARANTOR HEREBY IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER
PROVIDED FOR NOTICES IN SECTION 14. NOTHING IN THIS GUARANTY WILL AFFECT THE
RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW.

19. EACH OF THE PARTIES TO THIS GUARANTY HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE LOAN
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

20. Any invalid or unenforceable provisions in this Guaranty shall be deemed
severed herefrom, and such whole or partial invalidity shall not affect the
enforceability or validity of the balance of this Guaranty.

21. No failure on the part of the Administrative Agent or any other Guaranteed
Party to exercise, and no delay in exercising, any right, remedy or power
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise by the Administrative Agent or any other Guaranteed Party of any right,
remedy or power hereunder preclude any other or future exercise of any right,
remedy or power. Each and every right, remedy and power hereby granted to the
Administrative Agent or any other Guaranteed Party or allowed it by law or other
agreement shall be cumulative and not exclusive of any other, and may be
exercised by the Administrative Agent or any other Guaranteed Party at any time
or from time to time.

22. This Guaranty may be executed in counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.

23. This Guaranty constitutes the entire agreement and supersedes all prior
agreements and understandings, both written and oral, between Guarantor and the
Guaranteed Parties with respect to the subject matter hereof. Neither this
Guaranty nor any of the terms hereof may be terminated, amended, supplemented,
waived or modified except by an instrument in writing signed by the party
against which the enforcement of such termination, amendment, supplement, waiver
or modification shall be sought.

[Signatures on following page]

 

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IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be executed as of
the date first above written.

 

GUARANTORS:

bebe management, inc.

bebe stores (Canada), inc.

bebe studio, inc.

By:   /s/ Walter Parks Name:   Walter Parks Title:   Treasurer bebe studio
realty, LLC By:   /s/ Manny Mashouf Name:   Manny Mashouf Title:   Sole Manager

 

ACCEPTED BY: GACP Finance Co., LLC, as Administrative Agent By:   /s/ John Ahn
Name:   John Ahn Title:   President

 

Signature page to Guaranty

SUBSIDIARY GUARANTY

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Schedule I

Notices

Guarantors:

bebe stores, inc.

400 Valley Drive

Brisbane, CA 94005

Attention: Walter Parks, President and COO

Phone No.: (415) 657-4631

Email: wparks@bebe.com

with a copy (which shall not constitute notice) to:

bebe stores, inc.

400 Valley Drive

Brisbane, CA 94005

Attention: Gary Bosch, General Counsel

Phone No.: (415) 657-4644

Email: gbosch@bebe.com

with a copy (which shall not constitute notice) to:

Latham & Watkins LLP

140 Scott Drive

Menlo Park, CA 94025

Attention: Tad Freese

Phone No.: (650) 463-3060

Email: tad.freese@lw.com

Administrative Agent or Lenders:

GACP Finance Co., LLC

11100 Santa Monica Blvd., Suite 800

Los Angeles, CA 90025

Attention: Legal Department, Kevin Ramos

Email: kramos@gacapitalpartners.com

with a copy (which shall not constitute notice) to:

Dentons US LLP

1221 Avenue of the Americas

New York, NY10020-1089

Attention: Oscar Pinkas

Email: oscar.pinkas@dentons.com

 

Schedule I

SUBSIDIARY GUARANTY