Exhibit 10.2

AMENDED AND RESTATED GUARANTY

THIS AMENDED AND RESTATED GUARANTY, dated as of May 4, 2007 (this “Guaranty”),
by J. CREW GROUP, INC., a Delaware corporation (“Holdings”), J. CREW OPERATING
CORP., a Delaware corporation (“Operating”), J. CREW INC., a New Jersey
corporation (“J. Crew”), GRACE HOLMES, INC., a Delaware corporation doing
business as J. CREW RETAIL (“Retail”), H.F.D. NO. 55, INC., a Delaware
corporation doing business as J. Crew Factory (“Factory”), MADEWELL INC., a
Delaware corporation (“Madewell”), J. CREW INTERNATIONAL, INC. (“JCI”) and each
of the other entities listed on the signature pages hereof or that becomes a
party hereto pursuant to Section 24 (Additional Guarantors) hereof
(collectively, the “Guarantors” and each individually a “Guarantor”), in favor
of the Administrative Agent, each Lender, each Issuer and each other holder of
an Obligation (as each such term is defined in the Credit Agreement referred to
below) (each, a “Guarantied Party” and, collectively, the “Guarantied Parties”),
amends and restates that certain Guaranty, dated as of December 23, 2002 (the
“Existing Guaranty”), by the Guarantors in favor of Congress Financial
Corporation (predecessor in interest to Wachovia Bank, National Association)
(“Existing Agent”).

W I T N E S S E T H:

WHEREAS, pursuant to the Second Amended and Restated Credit Agreement dated as
of May 4, 2007 (together with all appendices, exhibits and schedules thereto and
as the same may be amended, restated, supplemented or otherwise modified from
time to time, the “Credit Agreement”; capitalized terms defined therein and used
herein having the meanings given to them in the Credit Agreement) among
Operating, J. Crew, Retail, Factory and Madewell, as Borrowers, Holdings and JCI
as Guarantors, the Lenders, the Issuers and CITICORP USA, INC. (“Citicorp”), as
administrative agent for the Lenders and the Issuers (in such capacity, the
“Administrative Agent”), Citicorp, as collateral agent for the Lenders and the
Issuers (in such capacity, the “Collateral Agent”) and BANK OF AMERICA, N.A, and
WACHOVIA BANK, NATIONAL ASSOCIATION as syndication agents for the Lenders and
Issuers (in such capacity, the “Syndication Agents”), the Lenders and Issuers
have severally agreed to make extensions of credit to the Borrowers upon the
terms and subject to the conditions set forth therein;

WHEREAS, Holdings owns 100% of the equity interests of Operating and each
Borrower (other than Operating) is a direct Subsidiary of Operating;

WHEREAS, each Guarantor desire to guaranty the Obligations (in the case of each
Borrower, other than its own Obligations) under the Credit Agreement;

WHEREAS, each Guarantor will receive substantial direct and indirect benefits
from the making of the Loans, the issuance of the Letters of Credit and the
granting of the other financial accommodations to the Borrowers under the Credit
Agreement;

WHEREAS, the Guarantors hereby reaffirm the guaranties offered pursuant to the
Existing Guaranty to the Existing Agent for the benefit of the Secured Parties
(as defined in the Existing Credit Agreement), which guaranties shall continue
in full force and effect during the term of this Agreement and any renewals
thereof and shall continue to guaranty the Obligations; and

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WHEREAS, a condition precedent to the obligation of the Lenders and the Issuers
to make their respective extensions of credit to the Borrowers under the Credit
Agreement is that each Guarantor shall have executed and delivered this Guaranty
for the benefit of the Guarantied Parties; and

NOW, THEREFORE, in consideration of the premises set forth above, the terms and
conditions contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

Section 1 Guaranty

(a) To induce the Lenders to make the Loans and the Issuers to issue Letters of
Credit, each Guarantor hereby absolutely, unconditionally and irrevocably
guarantees, jointly with the other Guarantors and severally, as primary obligor
and not merely as surety, the full and punctual payment when due and in the
currency due, whether at stated maturity or earlier, by reason of acceleration,
mandatory prepayment or otherwise in accordance herewith or any other Financing
Agreement, of all the Obligations (other than, in the case of each Borrower,
with respect to its own Obligations under the Financing Agreements), whether or
not from time to time reduced or extinguished or hereafter increased or
incurred, whether or not recovery may be or hereafter may become barred by any
statute of limitations, whether or not enforceable as against the Borrowers,
whether now or hereafter existing, and whether due or to become due, including
principal, interest (including interest at the contract rate applicable upon
default accrued or accruing after the commencement of any proceeding under the
Bankruptcy Code, or any applicable provisions of comparable state or foreign
law, whether or not such interest is an allowed claim in such proceeding), fees
and costs of collection. This Guaranty constitutes a guaranty of payment and not
of collection.

(b) Each Guarantor further agrees that, if (i) any payment made by any Borrower
or any other Person and applied to the Obligations is at any time annulled,
avoided, set aside, rescinded, invalidated, declared to be fraudulent or
preferential or otherwise required to be refunded or repaid, or (ii) the
proceeds of Collateral are required to be returned by any Guarantied Party to
any Borrower, its estate, trustee, receiver or any other party, including any
Guarantor, under any bankruptcy law, equitable cause or any other Requirement of
Law, then, to the extent of such payment or repayment, any such Guarantor’s
liability hereunder (and any Lien or other Collateral securing such liability)
shall be and remain in full force and effect, as fully as if such payment had
never been made. If, prior to any of the foregoing, this Guaranty shall have
been cancelled or surrendered (and if any Lien or other Collateral securing such
Guarantor’s liability hereunder shall have been released or terminated by virtue
of such cancellation or surrender), this Guaranty (and such Lien or other
Collateral) shall be reinstated in full force and effect, and such prior
cancellation or surrender shall not diminish, release, discharge, impair or
otherwise affect the obligations of any such Guarantor in respect of the amount
of such payment (or any Lien or other Collateral securing such obligation).

Section 2 Limitation of Guaranty

Any term or provision of this Guaranty or any other Financing Agreement to the
contrary notwithstanding, the maximum aggregate amount of the Obligations for
which any Subsidiary Guarantor shall be liable shall not exceed the maximum
amount for which such Subsidiary Guarantor can be liable without rendering this
Guaranty or any other Financing Agreement, as it relates to such Subsidiary
Guarantor, subject to avoidance under applicable law

 

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relating to fraudulent conveyance or fraudulent transfer (including Section 548
of the Bankruptcy Code or any applicable provisions of comparable state law)
(collectively, “Fraudulent Transfer Laws”), in each case after giving effect
(a) to all other liabilities of such Subsidiary Guarantor, contingent or
otherwise, that are relevant under such Fraudulent Transfer Laws (specifically
excluding, however, any liabilities of such Subsidiary Guarantor in respect of
intercompany Indebtedness to any Borrower to the extent that such Indebtedness
would be discharged in an amount equal to the amount paid by such Subsidiary
Guarantor hereunder) and (b) to the value as assets of such Subsidiary Guarantor
(as determined under the applicable provisions of such Fraudulent Transfer Laws)
of any rights to subrogation, contribution, reimbursement, indemnity or similar
rights held by such Subsidiary Guarantor pursuant to (i) applicable Requirements
of Law, (ii) Section 3 (Contribution) of this Guaranty or (iii) any other
Contractual Obligations providing for an equitable allocation among such
Subsidiary Guarantor and other Subsidiaries or Affiliates of the any Borrower of
obligations arising under this Guaranty or other guaranties of the Obligations
by such parties.

Section 3 Contribution

To the extent that any Subsidiary Guarantor shall be required hereunder to pay a
portion of the Obligations exceeding the greater of (a) the amount of the
economic benefit actually received by such Subsidiary Guarantor from the Loans
and the other financial accommodations provided to the Borrowers under the
Financing Agreements and (b) the amount such Subsidiary Guarantor would
otherwise have paid if such Subsidiary Guarantor had paid the aggregate amount
of the Obligations (excluding the amount thereof repaid by the Borrowers and
Holdings) in the same proportion as such Subsidiary Guarantor’s net worth at the
date enforcement is sought hereunder bears to the aggregate net worth of all the
Subsidiary Guarantors at the date enforcement is sought hereunder, then such
Guarantor shall be reimbursed by such other Subsidiary Guarantors for the amount
of such excess, pro rata, based on the respective net worths of such other
Subsidiary Guarantors at the date enforcement hereunder is sought.

Section 4 [Intentionally Deleted]

Section 5 Guaranty Absolute and Unconditional

Each Guarantor hereby waives any defense of a surety or guarantor or any other
obligor on any obligations arising in connection with or in respect of any of
the following (even if any right of reimbursement or subrogation or other right
or remedy of any Guarantor is extinguished, affected or impaired by any of the
foregoing (including any election of remedies by reason of any judicial,
non-judicial or other proceeding in respect of the Obligations that impairs any
subrogation, reimbursement or other right of such Guarantor) and hereby agrees
that its obligations under this Guaranty are absolute and unconditional and
shall not be discharged or otherwise affected as a result of any of the
following:

(a) the invalidity or unenforceability of any of the Borrowers’ obligations
under the Credit Agreement or any other Financing Agreement or any other
agreement or instrument relating thereto, or any security for, or other guaranty
of the Obligations or any part of them, or the lack of perfection or continuing
perfection or failure of priority of any security for the Obligations or any
part of them;

(b) the absence of any attempt to collect the Obligations or any part of them
from the Borrowers or any Borrower or other action to enforce the same;

 

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(c) failure by any Guarantied Party to take any steps to perfect and maintain
any Lien on, or to preserve any rights to, any Collateral;

(d) any Guarantied Party’s election, in any proceeding instituted under chapter
11 of the Bankruptcy Code, of the application of Section 1111(b)(2) of the
Bankruptcy Code or any applicable provisions of comparable state or foreign law;

(e) any borrowing or grant of a Lien by the Borrowers or any Borrower, as
debtor-in-possession, or extension of credit, under Section 364 of the
Bankruptcy Code or any applicable provisions of comparable state or foreign law;

(f) the disallowance, under Section 502 of the Bankruptcy Code, of all or any
portion of any Guarantied Party’s claim (or claims) for repayment of the
Obligations ;

(g) any use of cash collateral under Section 363 of the Bankruptcy Code;

(h) any agreement or stipulation as to the provision of adequate protection in
any bankruptcy proceeding;

(i) the avoidance of any Lien in favor of the Guarantied Parties or any of them
for any reason;

(j) any bankruptcy, insolvency, reorganization, arrangement, readjustment of
debt, liquidation or dissolution proceeding commenced by or against any
Borrower, any Guarantor or any of the Borrowers’ other Subsidiaries, including
any discharge of, or bar or stay against collecting, any Obligation (or any part
of them or interest thereon) in or as a result of any such proceeding;

(k) failure by any Guarantied Party to file or enforce a claim against the
Borrowers or any Borrower or its estate in any bankruptcy or insolvency case or
proceeding;

(l) any action taken by any Guarantied Party if such action is authorized
hereby;

(m) any election following the occurrence of an Event of Default by any
Guarantied Party to proceed separately against the personal property Collateral
in accordance with such Guarantied Party’s rights under the UCC or, if the
Collateral consists of both personal and real property, to proceed against such
personal and real property in accordance with such Guarantied Party’s rights
with respect to such real property;

(n) any change in the corporate existence or structure of any Borrower or any
other Loan Party;

(o) any defense, set-off or counterclaim (other than a defense of payment or
performance) which may at any time be available to or be asserted by any
Guarantor or any other Person against any Guarantied Party;

(p) any Requirement of Law affecting any term of any Guarantor’s obligations
under this Guaranty;

 

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(q) any other circumstance that might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor or any other obligor on any
obligations, other than the payment in full of the Obligations.

(r) if any Guarantied Party should supplement, renew, extend, accelerate, or
otherwise change the time for payment of, or other terms relating to, the
Obligations, or any part of them, or otherwise modify, amend or change the terms
of any promissory note or other agreement, document or instrument (including the
other Financing Agreements) now or hereafter executed by any Borrower and
delivered to the Guarantied Parties or any of them, including any increase or
decrease of principal or the rate of interest thereon;

(s) if any Guarantied Party should waive or otherwise consent to noncompliance
with any provision of any instrument evidencing the Obligations, or any part
thereof, or any other instrument or agreement in respect of the Obligations
(including the other Financing Agreements) now or hereafter executed by any
Borrower and delivered to the Guarantied Parties or any of them;

(t) if any Guarantied Party should accept partial payments on the Obligations;

(u) if any Guarantied Party should receive, take and hold additional security or
collateral for the payment of the Obligations or any part of them and exchange,
enforce, waive, substitute, liquidate, terminate, abandon, fail to perfect,
subordinate, transfer, otherwise alter and release any such additional security
or collateral;

(v) if any Guarantied Party should settle, release, compromise, collect or
otherwise liquidate the Obligations or accept, substitute, release, exchange or
otherwise alter, affect or impair any security or collateral for the Obligations
or any part of them or any other guaranty therefor, in any manner;

(w) if any Guarantied Party should add, release or substitute any one or more
other guarantors, makers or endorsers of the Obligations or any part of them and
otherwise deal with any Borrower or any other guarantor, maker or endorser;

(x) if any Guarantied Party should apply to the Obligations any payment or
recovery (x) from any Borrower, from any other guarantor, maker or endorser of
the Obligations or any part of them or (y) from any Guarantor in such order as
provided herein, in each case whether such Obligations are secured or unsecured
or guaranteed or not guaranteed by others;

(y) if any Guarantied Party should apply to the Obligations any payment or
recovery from any Guarantor of the Obligations or any sum realized from security
furnished by such Guarantor upon its indebtedness or obligations to the
Guarantied Parties or any of them, in each case whether or not such indebtedness
or obligations relate to the Obligations; or

(z) if any Guarantied Party should refund at any time any payment received by
any Guarantied Party in respect of any Obligation, and payment to such
Guarantied Party of the amount so refunded shall be fully guaranteed hereby even
though prior thereto this Guaranty shall have been cancelled or surrendered (or
any release or termination of any Collateral by virtue thereof), and such prior
cancellation or surrender shall not diminish, release, discharge, impair or
otherwise affect the obligations of any Guarantor hereunder in respect of the
amount so refunded (and any Collateral so released or terminated shall be
reinstated with respect to such obligations).

 

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Section 6 Waivers

Each Guarantor hereby waives diligence, promptness, presentment, demand for
payment or performance and protest and notice of protest, notice of acceptance
and any other notice in respect of the Obligations or any part of them, and any
defense arising by reason of any disability or other defense of any Borrower.
Each Guarantor shall not, until the Obligations are irrevocably paid in full and
the Revolving Credit Commitments have been terminated, assert any claim or
counterclaim it may have against any Borrower or set off any of its obligations
to any Borrower against any obligations of any Borrower to it. In connection
with the foregoing, each Guarantor covenants that its obligations hereunder
shall not be discharged, except by complete performance.

Section 7 Reliance

Each Guarantor hereby assumes responsibility for keeping itself informed of the
financial condition of each Borrower and any endorser and other guarantor of all
or any part of the Obligations, and of all other circumstances bearing upon the
risk of nonpayment of the Obligations, or any part thereof, that diligent
inquiry would reveal, and each Guarantor hereby agrees that no Guarantied Party
shall have any duty to advise any Guarantor of information known to it regarding
such condition or any such circumstances. In the event any Guarantied Party, in
its sole discretion, undertakes at any time or from time to time to provide any
such information to any Guarantor, such Guarantied Party shall be under no
obligation (a) to undertake any investigation not a part of its regular business
routine, (b) to disclose any information that such Guarantied Party, pursuant to
accepted or reasonable commercial finance or banking practices, wishes to
maintain confidential or (c) to make any other or future disclosures of such
information or any other information to any Guarantor.

Section 8 Waiver of Subrogation and Contribution Rights

Until the Obligations have been irrevocably paid in full and the Revolving
Credit Commitments have been terminated, the Guarantors shall not enforce or
otherwise exercise any right of subrogation to any of the rights of the
Guarantied Parties or any part of them against any Borrower or any right of
reimbursement or contribution or similar right against any Borrower by reason of
this Guaranty or by any payment made by any Guarantor in respect of the
Obligations.

Section 9 Subordination

Each Guarantor hereby agrees that any Indebtedness of any Borrower now or
hereafter owing to any Guarantor, whether heretofore, now or hereafter created
(the “Guarantor Subordinated Debt”), is hereby subordinated to all of the
Obligations and that, except as permitted under Section 8.5 (Restricted
Payments) of the Credit Agreement, the Guarantor Subordinated Debt shall not be
paid in whole or in part until the Obligations have been paid in full and this
Guaranty is terminated and of no further force or effect. No Guarantor shall
accept any payment of or on account of any Guarantor Subordinated Debt at any
time in contravention of the foregoing. Upon the occurrence and during the
continuance of an Event of Default and

 

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subject to the Intercreditor Agreement, the Guarantors shall pay to the
Administrative Agent any payment of all or any part of the Guarantor
Subordinated Debt and any amount so paid to the Administrative Agent shall be
applied to payment of the Obligations as provided in Section 2.13(f) (Payments
and Computations) of the Credit Agreement. Each payment on the Guarantor
Subordinated Debt received in violation of any of the provisions hereof shall be
deemed to have been received by such Guarantor as trustee for the Guarantied
Parties and shall be paid over to the Administrative Agent immediately on
account of the Obligations, but without otherwise affecting in any manner such
Guarantor’s liability hereof. Each Guarantor agrees to file all claims against
any Borrower in any bankruptcy or other proceeding in which the filing of claims
is required by law in respect of any Guarantor Subordinated Debt, and the
Administrative Agent shall be entitled to all of such Guarantor’s rights
thereunder. If for any reason a Guarantor fails to file such claim at least ten
Business Days prior to the last date on which such claim should be filed, such
Guarantor hereby irrevocably appoints the Administrative Agent as its true and
lawful attorney-in-fact and is hereby authorized to act as attorney-in-fact in
such Guarantor’s name to file such claim or, in the Administrative Agent’s
discretion, to assign such claim to and cause proof of claim to be filed in the
name of the Administrative Agent or its nominee. In all such cases, whether in
administration, bankruptcy or otherwise, the person or persons authorized to pay
such claim shall pay to the Administrative Agent the full amount payable on the
claim in the proceeding, and, to the full extent necessary for that purpose,
each Guarantor hereby assigns to the Administrative Agent all of such
Guarantor’s rights to any payments or distributions to which such Guarantor
otherwise would be entitled. If the amount so paid is greater than such
Guarantor’s liability hereunder, the Administrative Agent shall pay the excess
amount to the party entitled thereto. In addition, each Guarantor hereby
irrevocably appoints the Administrative Agent as its attorney-in-fact to
exercise all of such Guarantor’s voting rights in connection with any bankruptcy
proceeding or any plan for the reorganization of any Borrower.

Section 10 Default; Remedies

The obligations of each Guarantor hereunder are independent of and separate from
the Obligations. If any Obligation is not paid when due, or upon any Event of
Default hereunder or upon any default by any Borrower as provided in any other
instrument or document evidencing all or any part of the Obligations, the
Administrative Agent may, at its sole election, proceed directly and at once,
without notice, against any Guarantor to collect and recover the full amount or
any portion of the Obligations then due, without first proceeding against the
Borrowers or any Borrower or any other guarantor of the Obligations, or against
any Collateral under the Financing Agreements or joining the Borrowers or any
Borrower or any other guarantor in any proceeding against any Guarantor. At any
time after maturity of the Obligations, the Administrative Agent may (unless the
Obligations have been irrevocably paid in full), without notice to any Guarantor
and regardless of the acceptance of any Collateral for the payment hereof,
appropriate and apply toward the payment of the Obligations (a) any indebtedness
due or to become due from any Guarantied Party to such Guarantor and (b) any
moneys, credits or other property belonging to such Guarantor at any time held
by or coming into the possession of any Guarantied Party or any of its
respective Affiliates.

Section 11 Irrevocability

This Guaranty shall be irrevocable as to the Obligations (or any part thereof)
until the Commitments have been terminated and all monetary Obligations then
outstanding have been irrevocably repaid in cash, at which time this Guaranty
shall automatically be cancelled. Upon such cancellation and at the written
request of any Guarantor or its successors or assigns,

 

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and at the cost and expense of such Guarantor or its successors or assigns, the
Administrative Agent shall execute in a timely manner a satisfaction of this
Guaranty and such instruments, documents or agreements as are necessary or
desirable to evidence the termination of this Guaranty.

Section 12 Setoff

Upon the occurrence and during the continuance of an Event of Default, each
Guarantied Party and each Affiliate of a Guarantied Party is hereby authorized
at any time and from time to time, to the fullest extent permitted by
Requirements of Law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
Indebtedness at any time owing by such Guarantied Party to or for the credit or
the account of the Guarantied Parties against any and all of the Obligations now
or hereafter existing whether or not such Guarantied Party shall have made any
demand under this Guaranty and even though such Obligations may be unmatured.
Each Guarantied Party agrees promptly to notify the Borrower Agent after any
such set-off and application made by such Guarantied Party or its Affiliates:
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application. Each Guarantied Party agrees that it
shall not, without the express consent of the Requisite Lenders (and that, it
shall, to the extent lawfully entitled to do so, upon the request of the
Requisite Lenders) exercise its set-off rights under this Section 12 against any
deposit accounts of the Guarantors maintained with such Guarantied Party or any
Affiliate thereof. The rights of each Guarantied Party under this Section 12 are
in addition to the other rights and remedies (including other rights of set-off)
that such Guarantied Party may have.

Section 13 No Marshalling

Each Guarantor consents and agrees that no Guarantied Party or Person acting for
or on behalf of any Guarantied Party shall be under any obligation to marshal
any assets in favor of any Guarantor or against or in payment of any or all of
the Obligations.

Section 14 Enforcement; Waivers; Amendments

(a) No delay on the part of any Guarantied Party in the exercise of any right or
remedy arising under this Guaranty, the Credit Agreement, any other Financing
Agreement or otherwise with respect to all or any part of the Obligations, the
Collateral or any other guaranty of or security for all or any part of the
Obligations shall operate as a waiver thereof, and no single or partial exercise
by any such Person of any such right or remedy shall preclude any further
exercise thereof. Failure by any Guarantied Party at any time or times hereafter
to require strict performance by the Borrowers or any Borrower, any Guarantor,
any other guarantor of all or any part of the Obligations or any other Person of
any provision, warranty, term or condition contained in any Financing Agreement
now or at any time hereafter executed by any such Persons and delivered to any
Guarantied Party shall not waive, affect or diminish any right of any Guarantied
Party at any time or times hereafter to demand strict performance thereof and
such right shall not be deemed to have been waived by any act (except by a
written instrument pursuant to Section 14(b) or knowledge of any Guarantied
Party, or its respective agents, officers or employees. No waiver of any Event
of Default by any Guarantied Party shall operate as a waiver of any other Event
of Default or the same Event of Default on a future occasion, and no action by
any Guarantied Party permitted hereunder shall in any way affect or impair any
Guarantied Party’s rights and remedies or the obligations of any Guarantor under
this Guaranty. Any determination by a court of competent jurisdiction of the
amount of any principal or interest owing by the Borrowers or any Borrower to a
Guarantied Party shall be conclusive and binding on each Guarantor irrespective
of whether such Guarantor was a party to the suit or action in which such
determination was made.

 

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(b) None of the terms or provisions of this Guaranty may be waived, amended,
supplemented or modified except in accordance with Section11.1 (Amendments,
Waivers, Etc.) of the Credit Agreement.

Section 15 Successors and Assigns

This Guaranty shall be binding upon each Guarantor and upon the successors and
assigns of such Guarantors and shall inure to the benefit of the Guarantied
Parties and their respective successors and assigns; all references herein to
the Borrowers, to any Borrower and to the Guarantors shall be deemed to include
their respective successors and assigns. The successors and assigns of the
Guarantors and the Borrowers shall include, without limitation, their respective
receivers, trustees and debtors-in-possession. All references to the singular
shall be deemed to include the plural where the context so requires.

Section 16 Representations and Warranties; Covenants

JCI hereby (a) represents and warrants that the representations and warranties
as to it made by the Borrowers and Holdings in Article IV (Representations and
Warranties) of the Credit Agreement are true and correct on each date as
required by Section 3.2(b)(i) (Conditions Precedent to Each Loan and Letter of
Credit) of the Credit Agreement and (b) agrees to take, or refrain from taking,
as the case may be, each action necessary to be taken or not taken, as the case
may be, so that no Default or Event of Default is caused by the failure to take
such action or to refrain from taking such action by JCI.

Section 17 Governing Law

This Guaranty and the rights and obligations of the parties hereto shall be
governed by, and construed and interpreted in accordance with, the law of the
State of New York.

Section 18 Submission to Jurisdiction; Service of Process

(a) Any legal action or proceeding with respect to this Guaranty may be brought
in the courts of the State of New York located in the City of New York or of the
United States of America for the Southern District of New York, and, by
execution and delivery of this Guaranty, each of the Guarantors hereby accepts
for itself and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts. The parties hereto hereby irrevocably
waive any objection, including any objection to the laying of venue or based on
the grounds of forum non conveniens, that any of them may now or hereafter have
to the bringing of any such action or proceeding in such respective
jurisdictions.

(b) Each Guarantor hereby irrevocably designates, appoints and empowers the
Borrower Agent to act as its process agent, in the case of any suit, action or
proceeding brought in the United States of America as its designee, appointee
and agent to receive, accept and acknowledge for and on its behalf, and in
respect of its property, service of any and all legal process, summons, notices
and documents that may be serviced in any action or proceeding arising out of,
or in connection with, this Guaranty. Each Guarantor agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.

 

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(c) Nothing contained in this Section 18 (Submission to Jurisdiction; Service of
Process) shall affect the right of the Administrative Agent or any other
Guarantied Party to serve process in any other manner permitted by law or
commence legal proceedings or otherwise proceed against a Guarantor in any other
jurisdiction.

(d) If for the purposes of obtaining judgment in any court it is necessary to
convert a sum due hereunder in Dollars into another currency, the parties hereto
agree, to the fullest extent they may effectively do so, that the rate of
exchange used shall be that at which in accordance with normal banking
procedures the Administrative Agent could purchase Dollars with such other
currency at the spot rate of exchange quoted by the Administrative Agent at
11:00 a.m. (New York time) on the Business Day preceding that on which final
judgment is given, for the purchase of Dollars, for delivery two Business Days
thereafter.

Section 19 Waiver of Judicial Bond

To the fullest extent permitted by applicable law, the Guarantor waives the
requirement to post any bond that otherwise may be required of any Guarantied
Party in connection with any judicial proceeding to enforce such Guarantied
Party’s rights to payment hereunder, security interest in or other rights to the
Collateral or in connection with any other legal or equitable action or
proceeding arising out of, in connection with, or related to this Guaranty and
the Financing Agreements to which it is a party.

Section 20 Certain Terms

The following rules of interpretation shall apply to this Guaranty: (a) the
terms “herein,” “hereof,” “hereto” and “hereunder” and similar terms refer to
this Guaranty as a whole and not to any particular Article, Section, subsection
or clause in this Guaranty, (b) unless otherwise indicated, references herein to
an Exhibit, Article, Section, subsection or clause refer to the appropriate
Exhibit to, or Article, Section, subsection or clause in this Guaranty and
(c) the term “including” means “including without limitation” except when used
in the computation of time periods.

Section 21 Waiver of Jury Trial

EACH OF THE ADMINISTRATIVE AGENT, THE OTHER GUARANTIED PARTIES AND EACH
GUARANTOR IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH
RESPECT TO THIS GUARANTY AND ANY OTHER FINANCING AGREEMENT.

Section 22 Notices

Any notice or other communication herein required or permitted shall be given as
provided in Section 11.8 (Notices, Etc.) of the Credit Agreement and, in the
case of any Guarantor, to such Guarantor in care of the Borrowers.

 

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Section 23 Severability

Wherever possible, each provision of this Guaranty shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Guaranty shall be prohibited by or invalid under such law, such
provision shall be ineffective to the extent of such prohibition or invalidity
without invalidating the remainder of such provision or the remaining provisions
of this Guaranty.

Section 24 Additional Guarantors

Each of the Guarantors agrees that, if, pursuant to Section 7.11(b) (Additional
Collateral and Guaranties) of the Credit Agreement, Holdings or any Borrower
shall be required to cause any Subsidiary thereof that is not a Guarantor to
become a Guarantor hereunder, or if for any reason Holdings or any Borrower
desires any such Subsidiary to become a Guarantor hereunder, such Subsidiary
shall execute and deliver to the Administrative Agent a Guaranty Supplement in
substantially the form of Exhibit A (Guaranty Supplement) attached hereto and
shall thereafter for all purposes be a party hereto and have the same rights,
benefits and obligations as a Guarantor party hereto on the Closing Date.

Section 25 Collateral

Each Guarantor hereby acknowledges and agrees that its obligations under this
Guaranty are secured pursuant to the terms and provisions of the Collateral
Documents executed by it in favor of the Administrative Agent, for the benefit
of the Secured Parties.

Section 26 Costs and Expenses

In accordance with the provisions of Section 11.3 (Costs and Expenses) of the
Credit Agreement, each Guarantor agrees to pay or reimburse the Administrative
Agent and each of the other Guarantied Parties upon demand for all out-of-pocket
costs and expenses, including reasonable attorneys’ fees (including allocated
costs of internal counsel and costs of settlement), incurred by the
Administrative Agent and such other Guarantied Parties in enforcing this
Guaranty against such Guarantor or any security therefor or exercising or
enforcing any other right or remedy available in connection herewith or
therewith.

Section 27 Waiver of Consequential Damages

EACH GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE MAXIMUM
EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER ANY
SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGE IN ANY LEGAL ACTION OR
PROCEEDING IN RESPECT OF THIS GUARANTY OR ANY OTHER FINANCING AGREEMENT.

Section 28 Entire Agreement

This Guaranty, taken together with all of the other Financing Agreements
executed and delivered by the Guarantors, represents the entire agreement and
understanding of the parties hereto and supersedes all prior understandings,
written and oral, relating to the subject matter hereof.

 

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Section 29 Counterparts

This Guaranty may be executed in any number of separate counterparts and by
different parties in separate 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. Signature pages may be detached from multiple
counterparts and attached to a single counterpart so that all signature pages
are attached to the same document. Delivery of an executed counterpart by
facsimile transmission or electronic mail shall be effective as delivery of a
manually executed counterpart.

[SIGNATURE PAGES FOLLOW]

 

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IN WITNESS WHEREOF, this Amended and Restated Guaranty has been duly executed by
the Guarantors as of the day and year first set forth above.

 

J. CREW OPERATING CORP.

J. CREW INC.

GRACE HOLMES, INC.

H.F.D. NO. 55, INC.

MADEWELL INC.

J. CREW GROUP, INC.

By:   \s\ James S. Scully   Name: James S. Scully   Title: Chief Executive
Officer J. CREW INTERNATIONAL, INC. By:   \s\ Nicholas P. Lamberti   Name:
Nicholas P. Lamberti   Title: Vice President and Controller

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ACKNOWLEDGED AND AGREED

as of the date first above written:

CITICORP USA, INC.

as Administrative Agent

By:   \s\ Thomas M. Halsch   Name: Thomas M. Halsch   Title: Director

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EXHIBIT A

TO

GUARANTY

FORM OF GUARANTY SUPPLEMENT

The undersigned hereby agrees to be bound as a Guarantor for purposes of the
Guaranty, dated as of May 4, (the “Guaranty”), among J. CREW GROUP, INC., a
Delaware corporation, J. CREW OPERATING CORP., a Delaware corporation, J. CREW
INC., a New Jersey corporation, GRACE HOLMES, INC., a Delaware corporation doing
business as J. CREW RETAIL, H.F.D. NO. 55, INC., a Delaware corporation doing
business as J. Crew Factory (“Factory”), MADEWELL INC., a Delaware corporation
(“Madewell”), J. CREW INTERNATIONAL, INC., and acknowledged by CITICORP USA,
INC., as Administrative Agent, and the undersigned hereby acknowledges receipt
of a copy of the Guaranty. The undersigned hereby represents and warrants that
each of the representations and warranties contained in Section 16
(Representations and Warranties; Covenants) of the Guaranty applicable to it is
true and correct on and as the date hereof as if made on and as of such date.
Capitalized terms used herein but not defined herein are used with the meanings
given them in the Guaranty.

IN WITNESS WHEREOF, the undersigned has caused this Guaranty Supplement to be
duly executed and delivered as of                     ,             .

 

[NAME OF SUBSIDIARY GUARANTOR] By:        Name:   Title:

ACKNOWLEDGED AND AGREED

as of the date first above written:

CITICORP USA, INC.

as Administrative Agent

By:        Name:   Title: