Exhibit 10.3
 Guarantee and Collateral Agreement, dated as of May 29, 2007
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PageARTICLE I
DEFINITIONSSection 1.01.
    
    Credit Agreement
    
    
    5Section 1.02.
    
    Other Defined Terms
    
    
    5ARTICLE II
GUARANTEESection 2.01.
    
    Guarantee
    
    
    8Section 2.02.
    
    Guarantee of Payment
    
    
    9Section 2.03.
    
    No Limitations, Etc.
    
    
    9Section 2.04.
    
    Reinstatement
    
    
    10Section 2.05.
    
    Agreement To Pay; Contribution; Subrogation
    
    
    11Section 2.06.
    
    Information
    
    
    11Section 2.07.
    
    Maximum Liability
    
    
    11Section 2.08.
    
    Payment Free and Clear of Taxes
    
    
    11ARTICLE III
PLEDGE OF SECURITIESSection 3.01.
    
    Pledge
    
    
    12Section 3.02.
    
    Delivery of the Pledged Collateral
    
    
    12Section 3.03.
    
    Representations, Warranties and Covenants
    
    
    13Section 3.04.
    
    Registration in Nominee Name; Denominations
    
    
    15Section 3.05.
    
    Voting Rights; Dividends and Interest, Etc.
    
    
    15ARTICLE IV
SECURITY INTERESTS IN OTHER PERSONAL PROPERTYSection 4.01.
    
    Security Interest
    
    
    17Section 4.02.
    
    Representations and Warranties
    
    
    19Section 4.03.
    
    Covenants
    
    
    21Section 4.04.
    
    Other Actions
    
    
    24Section 4.05.
    
    Covenants Regarding Patent, Trademark and Copyright Collateral
    
    
    25Section 4.06.
    
    Intercreditor Relations
    
    
    25ARTICLE V
REMEDIESSection 5.01.
    
    Remedies Upon Default
    
    
    27
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PageSection 5.02.
    
    Application of Proceeds
    
    
    28Section 5.03.
    
    Securities Act, Etc.
    
    
    29ARTICLE VI
INDEMNITY, SUBROGATION AND SUBORDINATIONSection 6.01.
    
    Indemnity
    
    
    30Section 6.02.
    
    Contribution and Subrogation
    
    
    30Section 6.03.
    
    Subordination
    
    
    31ARTICLE VII
MISCELLANEOUSSection 7.01.
    
    Notices
    
    
    33Section 7.02.
    
    Security Interest Absolute
    
    
    33Section 7.03.
    
    Limitation By Law
    
    
    33Section 7.04.
    
    Binding Effect; Several Agreement
    
    
    33Section 7.05.
    
    Successors and Assigns
    
    
    34Section 7.06.
    
    Collateral Agents Fees and Expenses; Indemnification
    
    
    34Section 7.07.
    
    Collateral Agent Appointed Attorney-in-Fact
    
    
    34Section 7.08.
    
    GOVERNING LAW
    
    
    35Section 7.09.
    
    Waivers; Amendment
    
    
    35Section 7.10.
    
    WAIVER OF JURY TRIAL
    
    
    36Section 7.11.
    
    Severability
    
    
    36Section 7.12.
    
    Counterparts
    
    
    36Section 7.13.
    
    Headings
    
    
    36Section 7.14.
    
    Jurisdiction; Consent to Service of Process
    
    
    36Section 7.15.
    
    Termination or Release
    
    
    37Section 7.16.
    
    Additional Subsidiaries
    
    
    38Section 7.17.
    
    Right of Set-off
    
    
    38SchedulesSchedule I
    
    Subsidiary PartiesSchedule II
    
    Pledged Stock; Debt SecuritiesSchedule III
    
    Intellectual PropertySchedule IV
    
    Filing JurisdictionsSchedule V
    
    Commercial Tort ClaimsSchedule VI
    
    Matters Relating to Accounts and InventoryExhibitsExhibit I
    
    Form of Supplement to the Guarantee and Collateral Agreement
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Agreement Holdings Borrower Administrative Agent
 Credit Agreement
    Credit Agreement.
  Other Defined Terms
 Account Debtor
 Article 9 Collateral
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Collateral
 Copyright License
 Copyrights Schedule III
 Credit Agreement
 Federal Securities Laws
 General Intangibles
 Guarantors
 Intellectual Property
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Intellectual Property Security Agreement
 IP Agreements Schedule III
 Loan Document Obligations
 New York UCC
 Obligations
 Patent License
 Patents Schedule III Schedule III
 Permitted Liens
 Pledged Collateral
 Pledged Debt Securities
 Pledged Securities
 Pledged Stock
 Pledgor
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Secured Parties
 Security Interest
 Subsidiary Loan Party
 Trademark License
 Trademarks Schedule III
   Guarantee
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Guarantee of Payment
 No Limitations, Etc
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provided
     Reinstatement
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Agreement To Pay; Contribution; Subrogation
 Information
 Maximum Liability
 Payment Free and Clear of Taxes mutatis mutandis
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Pledge Schedule II
 subject however
 Delivery of the Pledged Collateral
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Schedule II Schedule II provided
  Representations, Warranties and Covenants
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Schedule II
  Schedule II
    14




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Registration in Nominee Name; Denominations
 Voting Rights; Dividends and Interest, Etc
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provided
  provided
 provided
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provided
   Security Interest
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provided
    Representations and Warranties
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Schedule IV
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Intellectual Property Collateral
 Schedule III
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Covenants
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Schedule III provided
  provided however
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Other Actions
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Instruments and Tangible Chattel Paper
 Investment Property Article
III
 Commercial Tort Claims
 Covenants Regarding Patent, Trademark and Copyright Collateral.
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Remedies Upon Default
  27




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Application of Proceeds
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Securities Act, Etc
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Indemnity
 Contribution and Subrogation
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Subordination;Subrogation
 Prohibited Payments, Etc
 Prior Payment of Guaranteed Obligations
 Turn-Over
 Administrative Agent Authorization
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Notices
 Security Interest Absolute
 Limitation By Law
 Binding Effect; Several Agreement
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Successors and Assigns
 Administrative Agents Fees and Expenses; Indemnification
 provided
  Administrative Agent Appointed Attorney-in-Fact
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GOVERNING LAW
 Waivers; Amendment
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WAIVER OF JURY TRIAL
 Severability
 Counterparts
 Headings
 Jurisdiction; Consent to Service of Process
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Termination or Release
 provided
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provided
 Additional Subsidiaries
 Right of Set-off
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BAUBLE HOLDINGS CORP.By:
    /s/ Peter P. CopsesName:
    Peter P. CopsesTitle:
    PresidentBAUBLE ACQUISITION SUB, INC.By:
    /s/ Peter P. CopsesName:
    Peter P. CopsesTitle:
    PresidentAFTERTHOUGHTS MERCHANDISING CORP.
CLAIRES BOUTIQUES, INC.
SASSY DOO!, INC.
CLAIRES PUERTO RICO CORP.
CBI DISTRIBUTING CORP.
CLAIRES CANADA CORP.
BMS DISTRIBUTING CORP.By:
    /s/ Rebecca OrandName:
    Rebecca OrandTitle:
    Vice President and Secretary 39




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CREDIT SUISSE, CAYMAN ISLANDS BRANCH,
as Administrative AgentBy:
    /s/ Robert HetuName:
    Robert HetuTitle:
    Managing DirectorCREDIT SUISSE, CAYMAN ISLANDS BRANCH,
as Administrative AgentBy:
    /s/ Denise AlvarezName:
    Denise AlvarezTitle:
    Associate 40