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ITEM 1.	BUSINESS

•	offering value to customers through a convenient omnichannel (store and Internet) shopping experience;

•	reaching customers, through differentiated value propositions, with our portfolio of e-commerce brands;

•	achieving a high degree of customer interaction by leveraging our comprehensive baby registry and birthday club in the United States and our Domestic and International loyalty programs;

•	continuing to refine our in-store customer experience and improving customer service;

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•	renovating and updating or relocating our existing stores to enhance the shopping experience and continually reviewing the market for new store opportunities; and

•	enhancing our product offerings and adding private label and exclusive products to our mix, including unique and exceptional items sold through the FAO Schwarz brand.

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•	867 traditional toy stores, which typically range in size from 20,000 to 50,000 square feet and devote 5,000 square feet to boutique areas for juvenile (including baby) products (including 97 Babies “R” Us Express (“BRU Express”) and Juvenile Expansion formats which devote an additional 4,000 square feet and 1,000 square feet, respectively, for juvenile - including baby - products);

•	400 SBS stores, which typically range in size from 30,000 to 70,000 square feet and devote 20,000 to 40,000 square feet to traditional toy products and 10,000 to 30,000 square feet to juvenile (including baby) products;

•	247 juvenile stores, which typically range in size from 30,000 to 45,000 square feet and devote 3,000 square feet to traditional toy products;

•	60 Express stores, which typically range in size from 2,000 to 7,000 square feet, each with a cumulative lease term of at least two years; and

•	3 flagship store locations (the Toys “R” Us store in Times Square, the FAO Schwarz store on 5th Avenue and the Babies “R” Us store in Union Square – all in New York City), which range in size from 55,000 to 105,000 square feet.

•	185 “R” Us branded retail stores ranging in various sizes. Licensing fees did not have a material impact on our Net sales.

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Domestic — Our Domestic segment sells a variety of products in the core toy, entertainment, juvenile (including baby), learning and seasonal categories through 873 stores that operate in 49 states in the United States and Puerto Rico and through the Internet. Domestic Net sales in fiscal 2013 were derived from 382 traditional toy stores (including 79 BRU Express and Juvenile Expansion formats), 232 juvenile stores, 214 SBS stores, 42 permanent Express stores and our three flagship stores in New York City. Additionally, we generated Net sales through our temporary Express store locations. Domestic Net sales were $7.6 billion for fiscal 2013, which accounts for 61% of our consolidated Net sales.

•	International — Our International segment sells a variety of products in the core toy, entertainment, juvenile (including baby), learning and seasonal categories through 704 operated and 185 licensed stores in 35 countries and jurisdictions and through the Internet. In addition to fees received from licensed stores, International Net sales in

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•	Core Toy — boys and girls toys, such as action figures, dolls and doll accessories, role play toys and vehicles;

•	Entertainment — video game software, systems and accessories, tablet computers, electronics and other related products;

•	Juvenile — focused on serving newborns and children up to four years of age by offering a broad array of products, such as baby gear, infant care products, apparel, commodities, furniture, bedding and room décor;

•	Learning — educational electronics and developmental toys, such as our Imaginarium products in the United States and World of Imagination products at our International locations, construction toys, games, creative activities and pre-school merchandise which includes learning products, activities and toys; and

•	Seasonal — toys and other products geared toward holidays (including Christmas, Hanukkah, Three Kings, Carnival, Easter, Golden Week and Halloween) and summer activities, as well as bikes, sporting goods, play sets and other outdoor products.

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(1)	This includes 42 Express stores that each have a cumulative lease term of at least two years and excludes the remaining 47 temporary Express store locations which remained open as of February 1, 2014. During the fiscal 2013 holiday selling season, we operated 219 Express stores domestically.

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(1)	This includes 18 Express stores that each have a cumulative lease term of at least two years and excludes the remaining 13 temporary Express store locations which remained open as of February 1, 2014. During the fiscal 2013 holiday selling season, we operated 46 Express stores internationally.

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ITEM 1A.	RISK FACTORS

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•	the availability of sufficient funds for the expansion;

•	the availability of attractive store locations and the ability to accurately assess the demographic or retail environment and customer demand at a given location;

•	the ability to negotiate favorable lease terms and obtain the necessary permits and zoning approvals;

•	the absence of occupancy delays;

•	the ability to construct, furnish and supply a store in a timely and cost effective manner;

•	the ability to hire and train new personnel, especially store managers, in a cost effective manner; and

•	general economic conditions.

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•	failure of our Internet service providers to perform their services properly and in a timely and efficient manner;

•	changes in consumer willingness to purchase goods via the Internet;

•	increases in software filters that may inhibit our ability to market our products through e-mail messages to our customers and increases in consumer privacy concerns relating to the Internet;

•	changes in applicable federal and state regulation, such as the Federal Trade Commission Act, the Children’s Online Privacy Act, the Fair Credit Reporting Act and the Gramm-Leach-Bliley Act and similar types of international laws;

•	breaches of Internet security;

•	failures in our Internet infrastructure or the failure of systems or third parties, such as telephone or electric power service, resulting in website downtime or other problems;

•	failure by us to process online customer orders properly and on time, which may negatively impact future online and in-store purchases by such customers;

•	failure by our service provider to provide warehousing and fulfillment services, which may negatively impact future online and in store purchases by customers; and

•	failure to keep up with changes in technology.

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•	increasing our vulnerability to general economic and industry conditions;

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•	requiring a substantial portion of cash flows from operating activities to be dedicated to the payment of principal and interest on our indebtedness, and as a result, reducing our ability to use our cash flows to fund our operations and capital expenditures, capitalize on future business opportunities, expand our business and execute our strategy;

•	increasing the difficulty for us to make scheduled payments on our outstanding debt and other obligations, as our business may not be able to generate sufficient cash flows from operating activities to meet our debt service obligations;

•	exposing us to the risk of increased interest expense due to changes in borrowing spreads and short-term interest rates;

•	causing us to make non-strategic divestitures;

•	limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements and general, corporate or other purposes; and

•	limiting our ability to adjust to changing market conditions and reacting to competitive pressure, and placing us at a competitive disadvantage compared to our competitors who are less leveraged.

•	incur certain additional indebtedness;

•	transfer money between Toys “R” Us, Inc. (the “Parent Company”) and our various subsidiaries;

•	pay dividends on, repurchase or make distributions with respect to our or our subsidiaries’ capital stock or make other restricted payments;

•	issue stock of subsidiaries;

•	make certain investments, loans or advances;

•	transfer and sell certain assets;

•	create or permit liens on assets;

•	consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;

•	enter into certain transactions with our affiliates; and

•	amend certain documents.

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ITEM 1B.	UNRESOLVED STAFF COMMENTS

ITEM 2.	PROPERTIES

(1)	Owned buildings on leased land.

(2)

This includes 42 and 18 Express stores within our Domestic and International segments, respectively, that each have a cumulative lease term of at least two years and excludes the remaining 47 and 13 temporary Express store locations within our Domestic and International segments, respectively, which remained open as of February 1, 2014. During the fiscal 2013 holiday selling season, we operated 219 Domestic and 46 International Express stores.

(3)	Represents total square footage occupied, excluding any space dedicated to mezzanines (with the exception of our flagship stores), catwalks, parking lots and decks.

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ITEM 3.	LEGAL PROCEEDINGS

ITEM 4.	MINE SAFETY DISCLOSURES

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ITEM 5.	MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

ITEM 6.	SELECTED FINANCIAL DATA

(1)	Our fiscal year ends on the Saturday nearest to January 31 of each calendar year. With the exception of fiscal 2012, which included 53 weeks, all other fiscal years presented include 52 weeks.

(2)	Refer to the Adjusted EBITDA table within this section for certain income and expense items that management believes make it more difficult to assess the Company’s actual operating performance.

(3)	Includes current portion of long-term debt and short-term borrowings. See Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

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(4)	As a result of the Labuan acquisition, on October 31, 2011, 90 of our licensed stores became part of our operated locations upon acquisition. As of February 1, 2014, February 2, 2013 and January 28, 2012, International operated stores included 129, 100 and 92 Labuan stores, respectively. See Note 17 to our Consolidated Financial Statements entitled “ACQUISITIONS” for further details.

(5)

Adjusted EBITDA is defined as EBITDA (earnings (loss) before net interest income (expense), income tax expense (benefit), depreciation and amortization), as further adjusted to exclude the effects of certain income and expense items that management believes make it more difficult to assess the Company’s actual operating performance including certain items which are generally non-recurring. We have historically excluded the impact of such items from internal performance assessments. We believe that excluding items such as Sponsors’ management and advisory fees, goodwill and asset impairment charges, restructuring charges, impact of litigation, noncontrolling interest, net gains on sales of properties and the other charges specified below, helps investors compare our operating performance with our results in prior periods. We believe it is appropriate to exclude these items as they are not related to ongoing operating performance and, therefore, limit comparability between periods and between us and similar companies.

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(a)	Represents litigation expenses recorded for certain legal matters. See Note 14 to our Consolidated Financial Statements entitled “LITIGATION AND LEGAL PROCEEDINGS” for further details.

(b)	Represents fees expensed to the Sponsors in accordance with the advisory agreement. The advisory fee paid to the Sponsors increases 5% per year during the ten-year term of the agreement with the exception of fiscal 2009. See Note 16 to our Consolidated Financial Statements entitled “RELATED PARTY TRANSACTIONS” for further details.

(c)	Represents a non-cash cumulative correction of prior period accrued vacation accounting in fiscal 2013. The adjustment in fiscal 2010 represents a non-cash cumulative correction of prior period straight-line lease accounting.

(d)	Asset impairments primarily due to the identification of underperforming stores and the relocation of certain stores. See Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” and Note 4 to our Consolidated Financial Statements entitled “FAIR VALUE MEASUREMENTS” for further details.

(e)	Represents the incremental compensation expense related to one-time executive awards, the fair market value remeasurement of existing liability awards and the repurchase of awards by the Company upon termination.

(f)	Represents state and city property transfer taxes recognized in fiscal 2010 related to the merger transaction in fiscal 2005, a portion of which were settled in fiscal 2012.

(g)	Restructuring and other charges consist primarily of costs incurred from the Company’s 2003 and 2005 restructuring initiatives. The additional charges are primarily due to changes in management’s estimates for events such as lease terminations, assignments and sublease income adjustments.

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(h)	Represents the sale of properties. See Note 5 to our Consolidated Financial Statements entitled “PROPERTY AND EQUIPMENT” for further details.

(i)	Represents noncontrolling interests in Labuan for fiscal 2011 through fiscal 2013, and Toys – Japan for fiscals 2009 and 2010.

(j)	Represents a $51 million gain recorded in Other income, net related to the litigation settlement with Amazon in fiscal 2009.

(k)	In fiscal 2011, in conjunction with the completion of the liquidation of TRU (HK) Limited, our wholly-owned subsidiary, we recognized a $1 million loss.

(l)	Represents costs incurred in conjunction with the acquisition of 70% ownership interest in Labuan from Li & Fung. See Note 17 to our Consolidated Financial Statements entitled “ACQUISITIONS” for further details.

(m)	Represents the write-off of damaged assets and repairs from a hurricane that hit the east coast of the United States, store fires in Australia, an earthquake and resulting tsunami that hit the Northeast coast of Japan and other property losses, net of insurance claims.

(n)	Represents certain officers’ severance and store closure costs.

(o)	Represents the incremental expense related to the write-down of excess and obsolete inventory.

(p)	Represents the impairment of goodwill associated with our Toys-Domestic and Toys-Japan reporting units. Refer to “CRITICAL ACCOUNTING POLICIES” within Item 7 entitled “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” for further details.

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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•	offering value to customers through a convenient omnichannel (store and Internet) shopping experience;

•	reaching customers, through differentiated value propositions, with our portfolio of e-commerce brands;

•	achieving a high degree of customer interaction by leveraging our comprehensive baby registry and birthday club in the United States and our Domestic and International loyalty programs;

•	continuing to refine our in-store customer experience and improving customer service;

•	renovating and updating or relocating our existing stores to enhance the shopping experience and continually reviewing the market for new store opportunities; and

•	enhancing our product offerings and adding private label and exclusive products to our mix, including unique and exceptional items sold through the FAO Schwarz brand.

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•	867 traditional toy stores, which typically range in size from 20,000 to 50,000 square feet and devote 5,000 square feet to boutique areas for juvenile (including baby) products (including 97 BRU Express and Juvenile Expansion formats which devote an additional 4,000 square feet and 1,000 square feet, respectively, for juvenile - including baby - products);

•	400 SBS stores, which typically range in size from 30,000 to 70,000 square feet and devote 20,000 to 40,000 square feet to traditional toy products and 10,000 to 30,000 square feet to juvenile (including baby) products;

•	247 juvenile stores, which typically range in size from 30,000 to 45,000 square feet and devote 3,000 square feet to traditional toy products;

•	60 Express stores, which typically range in size from 2,000 to 7,000 square feet, each with a cumulative lease term of at least two years; and

•	3 flagship store locations (the Toys “R” Us store in Times Square, the FAO Schwarz store on 5th Avenue and the Babies “R” Us store in Union Square – all in New York City), which range in size from 55,000 to 105,000 square feet.

•	185 “R” Us branded retail stores ranging in various sizes. Licensing fees did not have a material impact on our Net sales.

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Domestic — Our Domestic segment sells a variety of products in the core toy, entertainment, juvenile (including baby), learning and seasonal categories through 873 stores that operate in 49 states in the United States and Puerto Rico and through the Internet. Domestic Net sales in fiscal 2013 were derived from 382 traditional toy stores (including 79 BRU Express and Juvenile Expansion formats), 232 juvenile stores, 214 SBS stores, 42 permanent Express stores and our three flagship stores in New York City. Additionally, we generated Net sales through our temporary Express store locations. Domestic Net sales were $7.6 billion for fiscal 2013, which accounts for 61% of our consolidated Net sales.

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International — Our International segment sells a variety of products in the core toy, entertainment, juvenile (including baby), learning and seasonal categories through 704 operated and 185 licensed stores in 35 countries and jurisdictions and through the Internet. In addition to fees received from licensed stores, International Net sales in fiscal 2013 were derived from 485 traditional toy stores (including 18 BRU Express formats), 186 SBS stores, 18 permanent Express stores and 15 juvenile stores. Additionally, we generated Net sales through our temporary Express store locations. Our operated stores are located in Australia, Austria, Brunei, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom. International Net sales were $4.9 billion for fiscal 2013, which accounts for 39% of our consolidated Net sales.

•	Liquidity and capital requirements — Our operations have significant liquidity and capital requirements and depend on the availability of adequate financing on reasonable terms. If our lenders are unable to fund borrowings under their credit commitments or we are unable to borrow, it could have a significant negative effect on our business.

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E-commerce opportunities — The success and expansion of our e-commerce business depends on our ability to provide quality service to our customers and if we are not able to provide such services, our operating results may be materially adversely affected. We may be vulnerable to competitive pressures from the growing e-commerce activity in our market, such as price transparency, alternative distribution of video games and subscription models for commodities.

•	Seasonality — Our business is highly seasonal with a substantial portion of our sales and earnings generated in the fourth quarter, with the exception of the fourth quarter of fiscal 2013, which resulted in a net loss. During fiscals 2013, 2012 and 2011, 42%, 43% and 43%, respectively, of the Net sales from our worldwide business were generated in the fourth quarter.

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Increased competition — Our businesses operate in a highly competitive retail market. We compete on the basis of product variety, price, quality, availability, advertising and promotion, convenience or store location, safety, customer support and service. We face strong competition from discount and mass merchandisers, national and regional chains and department stores, consumer electronics retailers, local retailers in the markets we serve and Internet and catalog businesses.

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International — We conduct a significant portion of our business outside the United States. For fiscals 2013, 2012 and 2011, 39%, 40% and 40% of our Net sales, respectively, were generated outside the United States. Weakened global economic conditions, particularly the weakened and unstable environment in parts of Europe, could continue to affect us through lower sales due to reduced demand and the effects of foreign currency translation.

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•	stores that have been remodeled (including conversions) while remaining open;

•	stores that have been relocated and/or expanded to new buildings within the same trade area, in which the new store opens at about the same time as the old store closes;

•	stores that have expanded within their current locations; and

•	sales from our Internet businesses.

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(1)	Our reporting period for fiscals 2013 and 2011 includes 52 weeks compared to 53 weeks for fiscal 2012. Therefore, comparable store net sales for fiscal 2012 has been adjusted by one week as compared to Net sales.

(2)	For fiscal 2012, international comparable store net sales includes sales from stores acquired in the Labuan acquisition 56 weeks from their acquisition in fiscal 2011.

(1)	Consists primarily of shipping and other non-product related revenues.

(1)	Consists primarily of licensing fees from unaffiliated third parties and other non-product related revenues.

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(1)	Store count as of February 1, 2014 includes 20 BRU Express stores and 59 Juvenile Expansions. Store count as of February 2, 2013 included 21 BRU Express stores and 62 Juvenile Expansions. Store count as of January 28, 2012 included 20 BRU Express and 62 Juvenile Expansions.

(2)	Store count as of February 1, 2014 includes 18 BRU Express stores. Store count as of February 2, 2013 included 17 BRU Express Stores. Store count as of January 28, 2012 included 14 BRU Express stores.

(3)

Express stores with a cumulative lease term of at least two years are included in our overall store count, while remaining locations are excluded. As of February 1, 2014, there were 89 Domestic and 31 International Express stores open, 42 and 18 of which have been included in our overall store count within our Domestic and International segments, respectively. As of February 2, 2013, there were 84 Domestic and 41 International Express stores open, 36 and 23 of which were included in our overall store count within our Domestic and International segments, respectively. As of January 28, 2012, there were 47 Domestic and 43 International Express stores open, 31 of which were included in our overall store count within our Domestic segment, and none of which were included within our International segment.

(4)	Excluded from our overall store count are 185, 163 and 151 International licensed stores as of February 1, 2014, February 2, 2013 and January 28, 2012, respectively.

(5)	Excludes stores closed as a result of conversions and relocations.

(6)	The one conversion in fiscal 2013 was accompanied by multiple store closings. Of the 13 conversions in fiscal 2012, one was accompanied by multiple store closings.

(7)	Of the seven relocations in fiscal 2013, two were accompanied by multiple store closings. Of the six relocations in fiscal 2012, three were accompanied by multiple store closings.

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•	the cost of merchandise acquired from vendors;

•	freight in;

•	provision for excess and obsolete inventory;

•	shipping costs to consumers;

•	provision for inventory shortages; and

•	credits and allowances from our merchandise vendors.

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•	store payroll and related payroll benefits;

•	rent and other store operating expenses;

•	advertising and promotional expenses;

•	costs associated with operating our distribution network, including costs related to transporting merchandise from distribution centers to stores;

•	restructuring charges; and

•	other corporate-related expenses.

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•	credit card program income;

•	gift card breakage income;

•	impairment of long-lived assets;

•	net gains on sales of properties;

•	foreign exchange gains and losses; and

•	other operating income and expenses.

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(1)	Includes store updates and projects other than conversions.

(2)	Includes single format stores (including Express stores) as well as SBS relocations.

(3)	Primarily includes SBS conversions as well as other juvenile integration remodels.

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On February 27, 2013, Toys “R” Us France Real Estate SAS (“TRU France Real Estate”) entered into a five year senior secured term loan facility agreement (the “France Propco Facility Agreement”) for an aggregate principal amount of €48 million. The net proceeds of the loan under the France Propco Facility Agreement, together with cash on hand, were used to repay the principal balance of the €61 million French real estate credit facility due fiscal 2013.

•	On February 28, 2013, Toys-Japan entered into an additional bank loan with a financial institution for ¥2.0 billion. The loan will mature on February 26, 2021.

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On March 25, 2013, Toys “R” Us Properties (UK) Limited (“UK Propco”) entered into a facility agreement (the “New UK Propco Facility Agreement”), which was funded on March 28, 2013, for an aggregate principal amount of £263 million. The net proceeds of the loan under the New UK Propco Facility Agreement, together with cash on hand, were used to repay the principal balance of the £406 million UK real estate senior and junior credit facilities due fiscal 2013.

•	On June 25, 2013, Toys-Japan entered into an agreement with a syndicate of financial institutions to refinance Tranche 1. As a result, Tranche 1 is available in amounts of up to ¥13.0 billion, expiring on June 30, 2015.

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On August 21, 2013, Toys “R” Us Property Company I, LLC and its subsidiaries (“TRU Propco I”) entered into the Propco I Term Loan Facility. The Propco I Term Loan Facility was issued at a discount of $10 million, which resulted in the receipt of gross proceeds of $975 million. The proceeds, together with other funds available to TRU Propco I, were used to redeem in full the Propco I Notes, plus accrued interest, premiums and expenses, and to pay fees and expenses relating to the Propco I Term Loan Facility.

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On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for its ABL Facility in order to extend the maturity date of the facility and amend certain other provisions. The ABL Facility as amended will continue to provide for $1.85 billion of revolving commitments, and permits Toys-Delaware to request an increase in commitments by up to $1.15 billion, subject to certain conditions, including obtaining new or increased commitments from new or existing lenders. The ABL Facility has a final maturity date of March 21, 2019,

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(1)	Excluded from the minimum rental commitments displayed above are $2.0 billion related to options to extend ground lease terms that are reasonably assured of being exercised, the balance of which is predominantly related to fiscals 2019 and thereafter.

(2)	Included in capital leases and financing obligations displayed above is $65 million of interest.

(3)	Excludes the impact of the March 21, 2014 refinancing of the ABL Facility. See Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

(4)	Excludes finance obligations associated with capital projects and capital lease obligations, which are included in “Capital leases and financing obligations.”

(5)	In an effort to manage interest rate exposure, we periodically enter into interest rate swaps and interest rate caps. Interest payments presented are net of interest rate swaps or caps.

(6)	Interest payments for our ABL Facility, European ABL Facility and our Toys-Japan unsecured credit lines were estimated based on the average borrowings under each of the facilities in fiscal 2013.

(7)	Purchase obligations consist primarily of open purchase orders for merchandise as well as an agreement to purchase fixed or minimum quantities of goods that are not included in our Consolidated Balance Sheet as of February 1, 2014.

(8)	Includes pension obligations, risk management liabilities, and other general obligations and contractual commitments.

(9)	The above table does not reflect liabilities for uncertain tax positions of $33 million, which includes $3 million of current liabilities. The amount and timing of payments with respect to these items are subject to a number of uncertainties such that we are unable to make sufficiently reliable estimates of the timing and amount of future payments.

(10)

The above table does not reflect the potential acquisition of Li & Fung’s 30% interest in Labuan. The terms of the agreement provide us with the future option to acquire Li & Fung’s 30% interest in the business and also provides Li & Fung the option to require us to buy their 30% interest in the business at the end of three years from the acquisition date. See Note 17 to our Consolidated Financial Statements entitled “ACQUISITIONS” for further details.

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ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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We enter into short-term, cross-currency intercompany loans with our foreign subsidiaries. The majority of this exposure is economically hedged through the use of foreign currency exchange forward contracts. Our exposure to foreign currency risk related to exchange forward contracts on our short-term, cross-currency intercompany loans has not materially changed from fiscal 2012 to fiscal 2013. As a result, a 10% change in foreign currency exchange rates against the USD would not have a material impact on our pre-tax earnings related to our short-term, cross-currency intercompany loans that were outstanding as of year-end.

•	In addition, our foreign subsidiaries make USD denominated merchandise purchases through the normal course of business. From time to time, we enter into foreign exchange forward contracts under our merchandise import program. As of February 1, 2014, we did not have any outstanding foreign exchange forward contracts under our merchandise import programs.

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ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

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(1)	Foreign currency translation accounted for a $3 million decrease.

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•	For designated cash flow hedges, the effective portion of the changes in the fair value of derivatives is recorded in Accumulated other comprehensive (loss) income and subsequently recorded in Interest expense in the Consolidated Statements of Operations at the time the hedged item affects earnings.

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•	For designated cash flow hedges, the ineffective portion of a hedged derivative instrument’s change in fair value is immediately recognized in Interest expense in the Consolidated Statements of Operations.

•	For designated fair value hedges, the change in the fair value of the derivative as well as the offsetting change in fair value of the hedged item attributable to the hedged risk are recorded in Interest expense in the Consolidated Statements of Operations.

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(1)	Includes advertising income from our websites, fixed asset write-offs, gains and losses resulting from foreign currency translation related to operations and other miscellaneous income and expense charges.

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•	Australian dollar for our subsidiary in Australia;

•	British pound sterling for our subsidiary in the United Kingdom;

•	Brunei dollar for our subsidiary in Brunei;

•	Canadian dollar for our subsidiary in Canada;

•	Chinese yuan for our subsidiary in China;

•	Euro for our subsidiaries in Austria, France, Germany, Spain and Portugal;

•	Hong Kong dollar for our subsidiaries in Hong Kong;

•	Japanese yen for our subsidiary in Japan;

•	Malaysian ringgit for our subsidiary in Malaysia;

•	Polish zloty for our subsidiary in Poland;

•	Singapore dollar for our subsidiary in Singapore;

•	Swiss franc for our subsidiary in Switzerland;

•	Taiwan dollar for our subsidiary in Taiwan; and

•	Thailand baht for our subsidiary in Thailand.

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(1)

On February 27, 2013, Toys “R” Us France Real Estate SAS (“TRU France Real Estate”) entered into a five year senior secured term loan facility agreement (the “France Propco Facility Agreement”) for an aggregate principal amount of €48 million. The net proceeds of the loan under the France Propco Facility Agreement, together with cash on hand, were used to repay the principal balance of the €61 million French real estate credit facility due fiscal 2013.

(2)	On March 25, 2013, UK Propco entered into the New UK Propco Facility Agreement, which was funded on March 28, 2013, for an aggregate principal amount of £263 million. The net proceeds of the loan under the New UK Propco Facility Agreement, together with cash on hand, were used to repay the principal balance of the UK real estate senior and junior credit facilities due fiscal 2013.

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(3)	Toys “R” Us-Japan, Ltd. (“Toys-Japan”) currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit (“Tranche 1” and “Tranche 2”). On June 25, 2013, Toys-Japan entered into an agreement to refinance Tranche 1 of its committed lines of credit.

(4)	Represents obligations of Toys “R” Us - Delaware, Inc. (“Toys-Delaware”).

(5)

Represents obligations of Toys “R” Us Property Company I, LLC and its subsidiaries (“TRU Propco I”). On August 21, 2013, TRU Propco I entered into a senior unsecured term loan facility for an aggregate principal amount of $985 million due fiscal 2019 (the “Propco I Term Loan Facility”). The proceeds, together with other funds available to TRU Propco I, were used to redeem in full TRU Propco I’s $950 million senior unsecured 10.750% notes due fiscal 2017, plus accrued interest, premiums and fees.

(6)	Represents obligations of Toys “R” Us, Inc. (the “Parent Company”) legal entity. For further details on Parent Company information, refer to Schedule I — Parent Company Condensed Financial Statements and Notes to the Condensed Financial Statements.

(7)	Represents obligations of Toys “R” Us Property Company II, LLC (“TRU Propco II”).

(8)	On February 28, 2013, Toys-Japan entered into an additional bank loan with a financial institution for ¥2.0 billion.

(9)	Represents obligations of the Parent Company and Toys-Delaware.

(10)	We maintain derivative instruments on certain of our long-term debt, which impact our effective interest rates. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

•	incur certain additional indebtedness;

•	transfer money between the Parent Company and our various subsidiaries;

•	pay dividends on, repurchase or make distributions with respect to our or our subsidiaries’ capital stock or make other restricted payments;

•	issue stock of subsidiaries;

•	make certain investments, loans or advances;

•	transfer and sell certain assets;

•	create or permit liens on assets;

•	consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;

•	enter into certain transactions with our affiliates; and

•	amend certain documents.

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(1)	As of February 1, 2014, these derivatives were designated for hedge accounting.

(2)	The Company de-designated a portion of this interest rate cap in fiscal 2010. As of February 1, 2014 and February 2, 2013, 40% of the $500 million interest rate cap is designated as a cash flow hedge.

(3)

On February 27, 2013, TRU France Real Estate entered into a new interest rate cap to manage its future interest rate exposure in connection with the refinancing of the Company’s French real estate credit facility due in fiscal 2013. The interest rate cap has a notional amount of €47 million ($64 million at February 1, 2014) and matures on February 27, 2018. This cap has been designated a cash flow hedge which institutes a ceiling of 2.50% on the floating-rate EURIBOR exposure associated with our France Propco Facility Agreement.

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(1)

Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

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(1)	Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the fair value of our derivative instruments classified within the fair value hierarchy.

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(1)	Changes in the fair value of our Level 3 derivative financial instruments have been recorded in Interest expense on our Consolidated Statements of Operations. The total amount of unrealized gains for the period included in Interest expense attributable to assets held at February 2, 2013 was $3 million.

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(1)	Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

(2)	Includes a foreign currency translation of $3 million.

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(1)	Includes $51 million and $47 million of book overdraft cash as of February 1, 2014 and February 2, 2013, respectively.

(2)	Includes $107 million and $104 million of book overdraft cash as of February 1, 2014 and February 2, 2013, respectively.

(3)	Includes, among other items, accrued bonus and other benefits, current deferred tax liabilities, short-term borrowings and other accruals. No individual amount included exceeds 5% of Total current liabilities.

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(1)	Excluded from the minimum rental commitments displayed above is $2.0 billion related to options to extend ground lease terms that are reasonably assured of being exercised, the balance of which is predominantly related to fiscals 2019 and thereafter.

(2)	Included in Capital Leases and Financing Obligations displayed above is $65 million of interest.

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(1)

Foreign operations include the net impact of: differences between local statutory rates and the U.S. Federal statutory rate; the impact of changes to foreign valuation allowances; the net cost of foreign unrecognized tax benefits; the cost of repatriating foreign earnings, net of foreign tax credits; changes to our assertion regarding the permanent reinvestment of foreign earnings related to certain foreign entities; permanent items related to foreign operations; as well as changes in the tax status of foreign entities.

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(2)	Unrecognized tax benefits include benefits related to the resolution of issues in connection with concluding tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations. See “Unrecognized Tax Benefits” in this footnote.

(3)	Goodwill impairment represents the U.S. Federal tax cost associated with the amount of Goodwill that was impaired for which we did not have tax basis, and therefore for which we could not take a tax benefit.

(1)	The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities in the Consolidated Balance Sheets.

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(1)	Reductions for tax positions of prior years include amounts related to the resolution of issues in connection with concluding tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations.

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Domestic — Our Domestic segment sells a variety of products in the core toy, entertainment, juvenile (including baby), learning and seasonal categories through 873 stores that operate in 49 states in the United States and Puerto Rico and through the Internet. Domestic Net sales in fiscal 2013 were derived from traditional toy stores (including Babies “R” Us Express (“BRU Express”) and Juvenile Expansion formats), juvenile stores, side-by-side (“SBS”) stores, permanent Express stores (cumulative lease term of at least two years) and our flagship stores in New York City. Additionally, we generated Net sales through our temporary Express store locations.

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International — Our International segment sells a variety of products in the core toy, entertainment, juvenile (including baby), learning and seasonal categories through 704 operated and 185 licensed stores in 35 countries and jurisdictions and through the Internet. In addition to fees received from licensed stores, International Net sales in fiscal 2013 were derived from traditional toy stores (including BRU Express formats), SBS stores, permanent Express stores (cumulative lease term of at least two years) and juvenile stores. Additionally, we generated Net sales through our temporary Express store locations. Our operated stores are located in Australia, Austria, Brunei, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom.

(1)	Consists primarily of shipping and other non-product related revenues.

(1)	Consists primarily of licensing fees from unaffiliated third parties and other non-product related revenues.

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(1)

Includes Goodwill impairment of $361 million for fiscal 2013. Also includes gift card breakage income of $22 million, $19 million and $17 million for fiscals 2013, 2012 and 2011, respectively. Includes impairment of long-lived assets of $19 million, $8 million and $5 million for fiscals 2013, 2012 and 2011, respectively. In addition, includes the impact of net gains on sales of properties of $8 million, $3 million and $3 million for fiscals 2013, 2012 and 2011, respectively. Property damage write-offs and repairs for fiscals 2012 and 2011 were $6 million and $4 million, respectively. In addition, fiscal 2013 includes a $17 million non-cash cumulative adjustment of accrued vacation, resulting from a prior period correction. Fiscal 2013 also includes $23 million in litigation settlement expenses for certain legal matters, of which $20 million relates to the judgment in the Aleo v. SLB Toys USA Inc. case. For fiscals 2012 and 2011, $1 million and $8 million were included in litigation settlement expenses, respectively. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” and Note 14 entitled “LITIGATION AND LEGAL PROCEEDINGS” for further details.

(2)

Includes impairment of long-lived assets of $24 million, $3 million and $1 million for fiscals 2013, 2012 and 2011, respectively. Also includes Goodwill impairment of $17 million for fiscal 2013. In addition, includes the impact of net gains on sales of properties of less than $1 million for both fiscals 2013 and 2012, and gift card breakage income of $2 million, $2 million and $5 million for fiscals 2013, 2012 and 2011, respectively. Property damage write-offs and repairs for fiscals 2012 and 2011 were $2 million and $7 million, respectively. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” and Note 5 entitled “PROPERTY AND EQUIPMENT” for further details.

(3)	Includes impairment of long-lived assets of $1 million for fiscal 2013. In addition, includes the impact of net gains on sales of properties of $1 million for fiscal 2012. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

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(1)	Includes cash and cash equivalents, deferred tax assets and other corporate assets.

(1)	Includes our wholly-owned operations in Puerto Rico.

(2)	Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

(3)	Represents licensing fees from unaffiliated third parties.

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(1)	Includes our wholly-owned operations in Puerto Rico.

(2)	Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

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(1)	Domestic and international equity securities categorized as Level 2 are valued using the Net Asset Value (“NAV”) per fund share, which is derived from quoted prices in active markets of the underlying securities.

(2)	Domestic and international fixed-income securities categorized as Level 2 are valued using the NAV per fund share, which is derived using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported trades.

(3)

Insurance contracts contain a minimum guaranteed return and are categorized as Level 2 as the fair value of the assets is equal to the total amount of all individual technical reserves plus the non allocated employer’s financing fund reserves at the valuation date. The individual technical and financing fund reserves are equal to the accumulated paid contributions taking into account the insurance ratification and any allocated profit sharing return.

(4)	Cash and cash equivalents include highly liquid investments with an original maturity of three months or less at acquisition. Due to the nature and short maturity of these investments, their carrying amount approximates fair value. Therefore, we have determined that our cash and cash equivalents in their entirety are classified as Level 1 within the fair value hierarchy.

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(1)	Our Domestic and International businesses are highly seasonal with sales highest in the fourth quarter. During fiscals 2013, 2012 and 2011, 42%, 43% and 43%, respectively, of our total Net sales were generated in the fourth quarter. Our results of operations depend significantly upon the fourth quarter holiday selling season.

(2)	For the fourth quarter of fiscal 2013, our Net loss was impacted by Goodwill impairment of $378 million associated with our Toys-Domestic and Toys-Japan reporting units, the write-down of excess and obsolete inventory of $51 million, long-lived asset impairment of $37 million and a prior period vacation accrual correction of $17 million.

(3)	With the exception of the fourth quarter of fiscal 2012, which included 14 weeks, all other quarters presented include 13 weeks.

(4)

For the fourth quarter of fiscal 2012, our effective tax rate was unfavorably impacted by an increase to our valuation allowance of $22 million for certain state jurisdictions.  The increase in our valuation allowance was predominately due to the fact that, as of the end of fiscal 2012, in certain state tax jurisdictions we have incurred a pre-tax cumulative loss (after adjustments required for tax purposes) over the past three fiscal years.

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(1)	Represents obligations of Toys “R” Us, Inc. and Toys–Delaware.

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(1)

Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, net, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

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ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

ITEM 9A.	CONTROLS AND PROCEDURES

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ITEM 9B.	OTHER INFORMATION

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(1)	See “Directors” above for Mr. Urcelay’s biography.

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ITEM 11.	EXECUTIVE COMPENSATION

•	Antonio Urcelay, Chairman of the Board and Chief Executive Officer;

•	F. Clay Creasey, Jr., Executive Vice President — Chief Financial Officer;

•	Deborah Derby, Vice Chairman and Executive Vice President;

•	Monika M. Merz, President — Toys “R” Us, Asia Pacific;

•	Harry J. Mullany III, President — Toys “R” Us, U.S.; and

•	Gerald L. Storch, Former Chairman of the Board and Chief Executive Officer1

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•	provide each executive officer with compensation opportunities that are competitive with the compensation opportunities available to executives in comparable positions at companies with whom we compete for talent;

•	tie a significant portion of each executive officer’s compensation to our financial performance and his or her individual performance; and

•	align the interests of our executive officers with those of our equity holders.

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•	base salary;

•	annual incentive awards;

•	long-term incentives;

•	perquisites;

•	other benefits; and

•	benefits upon termination or change of control.

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•	Drive Product Differentiation;

•	Optimize eCommerce;

•	Focus on Service and Operational Excellence;

•	Design Store of the Future;

•	Change Value Perception;

•	Foundational Improvements; and

•	Reinvigorate Juvenile.

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(1)

For 2012, assuming the maximum award is achieved, the value of the performance awards, using a $44.00 stock price (the fair value of our common stock on the date of grant), would be $833,360 for Mr. Urcelay, $566,632 for Mr. Creasey, $666,688 for Ms. Merz and $2,400,024 for Mr. Storch. For 2011, assuming the maximum award is achieved, the value of the performance awards, using a $60.00 stock price (the fair value of our common stock on the date of the grant), would be $833,280 for Mr. Urcelay, $533,280 for Mr. Creasey, $666,720 for Ms. Merz and $3,000,000 for Mr. Storch.

(2)

These amounts represent the aggregate grant date fair value of equity awards granted in the specified fiscal year as calculated pursuant to ASC 718 (excluding estimates of forfeitures related to service-based and performance-based vesting conditions). For additional information about the valuation assumptions with respect to equity awards, refer to Note 7 of the financial statements included in this Annual Report on Form 10-K entitled “STOCK-BASED COMPENSATION.” See the “OUTSTANDING EQUITY AWARDS AT 2013 FISCAL YEAR-END” table below for the vesting terms and conditions of these awards which are outstanding at the end of fiscal 2013. Amounts reported reflect the incremental expense recognized in fiscal 2013 (computed in accordance with ASC 718) related to the option exchange and option extension which was $270,883 for Mr. Urcelay, $172 for Mr. Creasey, $172 for Ms. Derby and $10,333 for Ms. Merz. Amounts reported also reflect the incremental expense recorded during fiscals 2012 and 2011 (computed in accordance with ASC 718) related to certain awards that were required to be liability-classified as a result of Amendment No. 3 and Amendment No. 5 to the Management Equity Plan.  The incremental expense recognized in fiscal 2012 was $431,250 for Mr. Urcelay. For Ms. Merz, an incremental expense of $279,000 was recorded in fiscal 2011.

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(3)	Mr. Urcelay served as interim CEO from May 2013 to October 2013 and was named CEO in October 2013. Mr. Urcelay is compensated in Euros which are converted to USD each fiscal year based on the average monthly rate. The exchange rates are as follows:

(4)	Includes $513,363 for United States taxes paid by the Company, $260,371 for the purchase of annuity products under the MAPFRE Policies, $101,707 for commuting expenses, $37,038 for executive life insurance premiums, $36,330 for a leased car, $13,400 for executive medical premiums and $806 for financial planning services.

(5)	Includes $22,319 of Company contribution to the SERP, $13,676 for a leased car, $10,261 of Company matching contribution to the Savings Plan, $2,467 for financial planning services, $1,250 financial incentive for flying economy class under the Toys “R” Us, Inc. Corporate Travel and Expense Reimbursement Policy, $723 for life insurance premiums and $451 for long-term disability premiums.

(6)

Includes $1,449,000 for severance earned in fiscal 2013 related to Ms. Derby’s prior employment at the Company, $51,419 for a car allowance and for a leased car, $29,404 for financial planning services, $12,738 of Company contribution to the SERP, $7,538 of Company matching contribution to the Savings Plan, $2,637 for COBRA health insurance subsidy, $482 for life insurance premiums and $300 for long-term disability premiums.

(7)	Mr. Mullany was hired in November 2013.

(8)	Includes $52,601 for relocation expenses, $15,000 for financial planning services and $4,901 for a car allowance.

(9)	Ms. Merz is compensated in Canadian Dollars which are converted to USD each fiscal year based on the average monthly rate. The exchange rates are as follows:

(10)

Includes $442,034 for host country income tax payments for local benefits, $246,465 for Japanese estimated national income tax for fiscal 2013, $166,980 for housing, $115,700 for a Cost of Living Allowance (COLA), $98,469 Company contributions to the Deferred Profit Sharing Plan, $39,954 for tax equalization, $34,909 for home leave for Ms. Merz and her spouse, $19,266 for a car allowance, $7,406 for premiums for ex-patriate health care coverage for Ms. Merz and her spouse, $7,018 for furniture rental, $6,463 for utilities, $5,197 for Executive Wellness (benefit expenses not covered by the health plan), $3,835 for club fees for the American Club, $1,445 for tax preparations and $1,041 for language lessons.

(11)	Includes $2,557,615 for severance earned in fiscal 2013, $6,511 for a leased car, $723 for life insurance premiums, and $451 for long-term disability premiums.

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(1)

These amounts reflect estimated possible payouts under our annual incentive awards granted for fiscal 2013. Our Executive Committee approved the threshold, target and maximum payment amounts for fiscal 2013 in June 2013. Each named executive officer’s target payout was the following percentage of his or her base salary: 125% for Mr. Urcelay, 110% for Ms. Merz and Ms. Derby, and 100% for Mr. Creasey. Mr. Urcelay’s bonus target payout is weighted to reflect the period from February 2013 to October 2013 at a bonus target of 110% and the period from November 2013 to January 2014 at a bonus target of 150%. Mr. Mullany was hired in November 2013 and is not eligible for an annual incentive payout for fiscal 2013. Due to the transitional nature of his services, Mr. Storch was not eligible for an annual incentive award in fiscal 2013. The target payout is weighted 80% on the Financial Component and 20% on the Personal Component. For more information, see “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—ANNUAL INCENTIVE AWARDS” section set forth above.

(2)

The Threshold amount shown is 0% of the Target amount, which is comprised of the Financial Component and the Personal Component. The Financial Component pays out beginning at just above 0% of the Target amount if the threshold payout level is met. If the Threshold payout level is not met, no Financial Component will be paid. If 80% of the Financial Component target is not met, the Personal Component will not be paid.

(3)	The maximum, which refers to the maximum payout possible under the Management Incentive Plan, for fiscal 2013 was 300% of the Financial Component target and 200% of the Personal Component target. For a further description of these awards, see “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—ANNUAL INCENTIVE AWARDS” set forth above.

(4)

These options were granted under the 2010 Incentive Plan and 50% of the performance options will satisfy the performance vesting contingency upon the occurrence, on or before the 10th anniversary of the grant date, of certain liquidity events for the Sponsors as described in Mr. Mullany’s employment agreement in which the consideration received by the Sponsors reflects a price of the Company’s common stock of at least $33.50 per share and the remaining 50% will satisfy the performance vesting contingency based on the same criteria except that the price of the Company’s common stock shall be at a per share price of at least $40.00. For options which satisfy the performance criteria, such options will vest in equal annual installments over a four year period commencing with the first anniversary of the grant date.

(5)

These awards were granted under the 2010 Incentive Plan, except for Mr. Urcelay’s December 23, 2013 option expiration date extension, which was granted under the Management Equity Plan as discussed in footnote (8) below. These amounts represent the aggregate grant date fair value as calculated pursuant to ASC 718 (excluding estimates of forfeitures related to service-based and performance-based vesting conditions). For additional information about the valuation assumptions with respect to equity awards, refer to Note 7 of the financial statements included in this Annual Report on Form 10-K entitled “STOCK-BASED COMPENSATION” for further information.

(6)

These awards were canceled as part of the 2013 Option Exchange and New Options were issued December 23, 2013 under the 2010 Incentive Plan. The amounts reported reflect the grant date fair value for the May 2013 grants at the time of grant. The awards reported for Ms. Derby also reflect grants with exercise prices of $60.00 and $44.00 per share as provided in her employment agreement. The intent of these awards was to replace the option awards that she forfeited at the time she previously left the Company in February 2012.

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(1)	These options time vest 40% on the second anniversary of the grant date, 20% on the third anniversary of the grant date, 20% on the fourth anniversary of the grant date and 20% on the fifth anniversary of the grant date.

(2)	These awards vest 50% on the second anniversary of the grant date, 25% on the third anniversary of the grant date and 25% on the fourth anniversary of the grant date. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(3)	These restricted stock units vest 50% on October 16, 2014 and 12.5% at the end of each of the first four quarters following the first anniversary of the grant date. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(4)	These options and restricted stock unit awards vest in four equal annual installments beginning on the first anniversary of the grant date. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(5)

These stock options are subject to a performance component, where 50% of the stock options will satisfy the performance vesting contingency upon the occurrence, on or before the tenth anniversary of the grant date, of certain liquidity events for the Sponsors as described in Mr. Mullany’s employment agreement in which the consideration received by Sponsors reflects a price of the Company’s common stock of at least $33.50 per share and the remaining 50% of the stock options will satisfy the performance vesting contingency based upon the same criteria except that the price of the Company’s common stock shall be at a per share price of at least $40.00. For the options that satisfy the performance contingency criteria, such options will vest in equal annual installments over a four year period commencing with the first anniversary of the grant date. The vesting of these awards may accelerate under certain

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(6)	The option expiration date was extended to August 6, 2017 as part of the 2013 Option Extension. For a further description of this extension, see “COMPENSATION DISCUSSION AND ANALYSIS—SUMMARY OF SIGNIFICANT 2013 COMPENSATION DECISIONS” set forth above.

(7)	In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

(8)

The awards granted to Mr. Urcelay and Ms. Merz on December 23, 2013 will become fully vested and exercisable upon retirement as they meet the age and service criteria for retirement (i.e. voluntary termination of employment after attaining age 60 with at least ten years of continuous service to the Company), except the vesting of Mr. Urcelay’s November 5, 2013 grant of restricted stock units which will not accelerate upon retirement.

(1)	The value realized on exercise is based on the valuation price during the transaction window when the named executive officer exercised the stock options. At the time Mr. Urcelay and Ms. Merz exercised these stock options, the valuation price was $32.00 per share. At the time Mr. Storch exercised these stock options, the valuation price was $30.00 per share.

(1)

We make an annual contribution to the SERP for each U.S. executive officer who is employed on the last day of the SERP plan year. The amount of the contribution is equal to 4% of that portion of the eligible executive officer’s “total compensation” in excess of the dollar limits under Internal Revenue Code Section 401(a)(17). Due to the fact that Mr. Mullany’s employment commenced in November 2013, he was not eligible to participate in the Savings Plan and the SERP plan as he did not yet satisfy length of employment criteria set forth under the plans. Generally, total compensation means compensation as reported on Form W-2 with the Internal Revenue Service or such other definition as is utilized under the Savings Plan. However, total compensation includes amounts paid pursuant to our Management Incentive Plan but does not include sign-on bonuses, retention bonuses, project completion bonuses or other types of success bonuses. The Executive Committee may at its discretion also credit additional notional contributions if the Company had an exceptional year.

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(2)	All contributions that we made for each executive officer during fiscal 2013 were included in the “All Other Compensation” column of the “SUMMARY COMPENSATION TABLE” above.

(3)

Earnings on nonqualified deferred compensation were not required to be reported in the “SUMMARY COMPENSATION TABLE”. Each U.S. executive’s SERP account is credited or debited with “Declared Interest,” which is based upon hypothetical investments selected by the executive officer pursuant to procedures established by the administrative committee that administers the SERP. The Administrator of the SERP determines the number of investment options available under the SERP and such investment options are comprised of a subset of the investment options available under the Savings Plan. Participants in the SERP have the right to change their hypothetical investment selections on a daily basis. The contributions made by the Company vest five years after the executive officer’s first day of employment with the Company. All SERP distributions are paid in lump sums upon termination of the participant’s employment with the Company.

(4)	Of the aggregate balance amount set forth in this column, $207,858 was previously reported in the Summary Compensation table for Mr. Creasey for prior fiscal years. $937,900 was previously reported in the Summary Compensation Table for contributions to the Spain Savings Plan and the MAPFRE policies for Mr. Urcelay for prior fiscal years.

(5)	These amounts reflect the annuity products purchased for the benefit of Mr. Urcelay under the MAPFRE Polices.

(6)	Pursuant to the terms of her employment, Ms. Merz is entitled to receive from the Company a contribution amount equal to 8% of her pay, which was equal to $98,469 for fiscal 2013. Under Canadian law, the Company can only contribute $11,690 to the Deferred Profit Sharing Plan. The balance of the Company contribution, $65,458, is paid to Ms. Merz in a lump sum cash payment.

•	a payment of €2,444,400 payable in twenty four (24) monthly installments, except such amount will be payable in a lump sum, subject to statutory limitations, if the executive’s termination of employment occurs within two years after a change in control (as defined in the 2010 Incentive Plan);

•	continuation of car benefit for eighteen months, excluding gas, maintenance and other usage-related expenses;

•	continuation of health benefits for eighteen months;

•	continuation of the use of his Company provided laptop computer and cell phone for eighteen months, except that he will be responsible for the costs of all telephone calls; and

•	continuation of Company contributions to his defined contribution plan and provision of tax advice for eighteen months.

•	upon termination of his employment for Cause or upon resignation (other than resignation for a Good Reason) or upon retirement;

•	if he is removed from the position of Chief Executive Officer within twenty four (24) months following a Change in Control and if he is offered another professional position in the Company with equivalent target compensation in the Madrid, Spain area; or

•	upon termination of his employment at any time on or after October 31, 2015 for any reason, whether with or without Cause, or for his resignation for Good Reason.

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•	engage in any business that directly or indirectly is a Competitive Business (as defined in his employment agreements);

•	enter the employ of, or render any services to, any person who or which engages in a Competitive Business;

•	acquire a financial interest in, or otherwise become actively involved with, any Competitive Business, directly or indirectly;

•	interfere with, or attempt to interfere with, business relationships between the Company or any of its affiliates and customers, clients, suppliers, partners, members or investors of the Company or its affiliates;

•	solicit to leave the employment of, or encourage any employee of the Company or its affiliates to leave the employment of, the Company or its affiliates;

•	hire any such employee who was employed by the Company or its affiliates as of the date of executive’s termination of employment with the Company or who left the employment of the Company or its affiliates coincident with, or within one year prior to, the termination of executive’s employment with the Company; and

•	solicit to leave the employment of, or encourage to cease to work with, as applicable, the Company or its affiliates or any consultant, supplier or service provider under contract with the Company or its affiliates.

•	any base salary earned, but unpaid as of the date of his or her termination;

•	any employee benefits that he or she may be entitled to under the Company’s employee benefit plans; and

•	any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of the executive’s termination.

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continued medical, dental and life insurance benefit coverage, a portion paid by Ms. Derby, until the earlier to occur of (x) twelve (12) months from date of termination and (y) the date on which Ms. Derby is eligible for coverage under substantially comparable benefit plans (the “Benefit Continuation Period”) and upon expiration of the Benefit Continuation Period, Ms. Derby shall pay the premium charged to former employees of the Company pursuant to Section 4980B of the Code until Ms. Derby turns 65.

•	any base salary earned, but unpaid as of the date of the executive’s termination;

•	any employee benefits that he may be entitled to under the Company’s employee benefit plans;

•	any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of the executive’s termination; and

•	a pro rata portion of the executive’s annual incentive award for the current fiscal year earned through the date of termination, based on the Company’s actual results as opposed to the executive’s target annual incentive award.

•	any base salary earned, but unpaid as of the date of the executive’s termination;

•	any employee benefits that the executive may be entitled to under the Company’s employee benefit plans;

•	any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of the executive’s termination;

•	a pro rata portion of the executive’s annual incentive award earned through the date of termination, based on the Company’s actual results as opposed to the executive’s target annual incentive award.

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an amount equal to two times the sum of (x) his then-current base salary and (y) his target annual bonus amount payable in twenty four (24) monthly installments, except such amount will be payable in a lump sum, subject to statutory limitations, if the executive’s termination of employment occurs two years after a change in control (as defined in the 2010 Incentive Plan); provided however, if Mr. Mullany’s employment is terminated prior to the second anniversary of his commencement date, then he will be entitled to receive only an amount equal to two times his then current base salary; and

•

continuation of medical, dental and life insurance benefits, with the executive paying a portion of such costs as if his employment had not terminated, until the earlier to occur of (i) the end of the twenty four (24) month period commencing on the date of termination of employment (the “Severance Period”) or (ii) the date on which the executive commences to be eligible for coverage under substantially comparable medical, dental and life insurance benefit plans from any subsequent employer.

•	an amount equal to $750,000 in a lump sum payment within sixty (60) days following Ms. Derby’s termination of employment; and

•	to the Continued Benefit Coverage.

•	engage in any business that directly or indirectly is a Competitive Business (as defined in each of their employment agreements);

•	enter the employ of, or render any services to, any person who or which engages in a Competitive Business;

•	acquire a financial interest in, or otherwise become actively involved with, any Competitive Business, directly or indirectly;

•	interfere with, or attempt to interfere with, business relationships between the Company or any of its affiliates and customers, clients, suppliers, partners, members or investors of the Company or its affiliates;

•	solicit to leave the employment of, or encourage any employee of the Company or its affiliates to leave the employment of, the Company or its affiliates;

•	hire any such employee who was employed by the Company or its affiliates as of the date of executive’s termination of employment with the Company or who left the employment of the Company or its affiliates coincident with, or within one year prior to, the termination of his or her employment with the Company; and

•	solicit to leave the employment of, or encourage to cease to work with, as applicable, the Company or its affiliates or any consultant, supplier or service provider under contract with the Company or its affiliates.

•	any base salary earned, but unpaid as of the date of her termination; and

•	any employee benefits that she may be entitled to under Toys “R” Us Canada Ltd.’s employee benefit plans.

•	any base salary earned, but unpaid as of the date of her termination;

•	any employee benefits that she may be entitled to under the Toys “R” Us Canada Ltd.’s employee benefit plans; and

•	any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of her termination.

•	any base salary earned, but unpaid as of the date of her termination;

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•	any employee benefits that she may be entitled to under the Company’s employee benefit plans;

•	any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of her termination;

•	a pro rata portion of her annual incentive award earned through the date of termination, based on the Company’s actual results as opposed to her target annual incentive award;

•

an amount equal to two (2) times the sum of: (x) her current base salary for the fiscal year in which her employment was terminated and (y) her target annual incentive award, payable in equal installments for 24 months in accordance with normal payroll periods; provided if Ms. Merz is terminated without cause or resigns for good reason within six months prior to, or two years following, a change in control, such payment will be in a lump sum; and

•	continuation of dental and life insurance benefits, with the executive paying a portion of such costs as if her employment had not terminated, until the earlier to occur of (i) the end of the twenty four (24) month period commencing on the date of termination of employment or (ii) such time as she accepts other employment and becomes eligible for dental and life insurance coverage.

•	engage either directly or indirectly in a Competitive Business (as defined in her employment agreement);

•	enter the employ of, or render any services to, any person who or which engages in a Competitive Business;

•	acquire a financial interest in, or otherwise become actively involved with, any Competitive Business, directly or indirectly;

•	interfere with, or attempt to interfere with, business relationships between the Company or any of its affiliates and customers, clients, suppliers, partners, members or investors of the Company or its affiliates;

•	solicit to leave the employment of, or encourage any employee of the Company or its affiliates to leave the employment of, the Company or its affiliates;

•	hire any such employee who was employed by the Company or its affiliates as of the date of her termination of employment with the Company or who left the employment of the Company or its affiliates coincident with, or within one year prior to, the termination of her employment with the Company; and

•	solicit to leave the employment of, or encourage to cease to work with, as applicable, the Company or its affiliates or any consultant, supplier or service provider under contract with the Company or its affiliates.

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(1)	All amounts calculated in Euros have been converted to USD using the rate of 1.0000 EURO = 1.3308 USD.

(2)

In the event Mr. Urcelay is terminated by the Company for Cause or resigns without Good Reason on or before October 2014, Mr. Urcelay will have to reimburse the Company for the full amount of his €250,000 acceptance bonus. If Mr. Urcelay is terminated by the Company for Cause or resigns without Good Reason after October 2014 but before October 2015, he must reimburse the Company for 50% of the acceptance bonus.

(3)	Represents the maximum amount of severance that Mr. Urcelay may receive. All severance amounts are payable over a 24 month period, except such amount will be payable in a lump sum, subject to statutory limitations, if Mr. Urcelay’s termination of employment occurs within two years of a change in control.

(4)	Pursuant to the Management Equity Plan, the unvested portion of options will accelerate and become vested upon retirement, death, disability or a change in control. These options are 100% vested, so Mr. Urcelay would not recognize any additional value.

(5)

Pursuant to the 2010 Incentive Plan, the unvested portion of restricted stock units, will accelerate and become vested upon retirement (except in the case of retirement for Mr. Urcelay’s one-time $8,001,400 grant), death, disability or change in control. Mr. Urcelay’s one-time $8,001,400 restricted stock unit grant will not accelerate upon retirement and 50% of such award would accelerate upon termination without cause. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of our shares of common stock is only available when a valuation is performed.

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(6)

Pursuant to the 2010 Incentive Plan, the unvested portion of options will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of our shares of common stock is only available when a valuation is performed. Because the per share value of $22.00 is equal to the option exercise price of $22.00, no value is reflected in the table.

(7)	This amount represents Mr. Urcelay’s benefit entitlement under the MAPFRE Policies. For more information on Mr. Urcelay’s balance, see the Nonqualified Deferred Compensation for Fiscal 2013 table above.

(8)	All benefit eligible employees in Spain receive, at no cost to the individual, a life insurance benefit. Mr. Urcelay’s benefit amount is equal to five times his base salary.

(9)

Represents estimated Company costs of the following benefits and perquisites based on fiscal 2013 actual amounts for the duration of eighteen months, as set forth in Mr. Urcelay’s employment agreement: $390,557 for Company contributions to his Defined Contribution Plan, $54,495 for a Company car, $20,100 for health benefit continuation and $1,209 for tax advice and $150 for continued use of Company provided laptop and cell phone.

(1)	Severance amounts payable due to a Termination Without Cause or Resignation For Good Reason are payable over a two year period. Upon a Change in Control, such payments will be paid in a lump-sum amount, subject to statutory limitations.

(2)	Pursuant to the Management Equity Plan, the unvested portion of options will accelerate and become vested upon retirement, death, disability or a change in control. These options are 100% vested, so Mr. Creasey would not recognize any additional value.

(3)

Pursuant to the 2010 Incentive Plan, the unvested portion of restricted stock units will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of shares of our common stock is only available when a valuation is performed.

(4)

Pursuant to the 2010 Incentive Plan, the unvested portion of options will accelerate and become vested upon retirement, death or disability. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed. Because the per share value of $22.00 is equal to the option exercise price of $22.00, no value is reflected in the table.

(5)	Represents estimated Company costs based on fiscal 2014 projections for medical, dental and life insurance coverage for the duration of the two year severance period.

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(1)	Severance amounts payable due to a Termination Without Cause or Resignation For Good Reason are payable in a lump sum within 60 days following termination of employment

(2)

Pursuant to the 2010 Incentive Plan, the unvested portion of restricted stock units will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

(3)

Pursuant to the 2010 Incentive plan, the unvested portion of options will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of our shares of common stock is only available when a valuation is performed. Because the per share value of $22.00 is equal to the option exercise price of $22.00, no value is reflected in the table.

(4)	Represents Company costs based on an average annual rate of $17,260 for medical, dental and life insurance coverage until Ms. Derby reaches the age of 65.

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(1)

In the event Mr. Mullany is terminated by the Company for Cause or resigns without Good Reason on or before November 2014, Mr. Mullany will have to reimburse the Company for the full amount of his $300,000 sign-on bonus. If Mr. Mullany is terminated by the Company for Cause or resigns without Good Reason after November 2014 but before November 2015, he shall reimburse the Company for 50% of the sign-on bonus.

(2)	Severance amounts payable due to a Termination Without Cause or Resignation For Good Reason are payable over a two year period. Upon a Change in Control, such payments will be paid in a lump-sum amount, subject to statutory limitations.

(3)	Upon death or disability, Mr. Mullany is entitled to a pro rata portion of his annual incentive award. However, Mr. Mullany was hired in November 2013 and was not eligible for an annual incentive payout for fiscal 2013.

(4)

Pursuant to the 2010 Incentive Plan, the unvested portion of shares will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

(5)

Pursuant to the 2010 Incentive Plan, the unvested portion of time-based options will accelerate and vest upon retirement, death, disability and a pro rata portion of performance-based options will vest based on actual results. In calculating the amounts set forth in the table, for the time-based options, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed. Because the per share value of $22.00 is equal to the option exercise price of $22.00, no value is reflected in the table. In addition, no value is reflected in the table for the performance-based options, as the performance criteria has not been met as of fiscal year-end 2013.

(6)	Represents estimated Company costs based on fiscal 2014 projections for medical, dental and life insurance coverage for the duration of the two year severance period.

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(1)	All amounts calculated in Canadian dollars have been converted to USD using the rate of 1.0000 CAD = 0.9633 USD.

(2)	All severance amounts are payable over a two year period. Upon a Change in Control, such payments will be paid in a lump sum amount.

(3)	Pursuant to the Management Equity Plan, the unvested portion of options will accelerate and become vested upon retirement, death, disability or a change in control. These options are 100% vested, so Ms. Merz would not recognize any additional value.

(4)

Pursuant to the 2010 Incentive Plan, the unvested portion of restricted stock units will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

(5)

Pursuant to the 2010 Incentive Plan, the unvested portion of options will accelerate and become vested upon retirement, death or disability based on actual results. In calculating the amounts set forth in the table, we utilized a per share value of $22.00, which was the fair value of our shares of common stock as of October 28, 2013. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed. Because the per share value of $22.00 is equal to the option exercise price of $22.00, no value is reflected in the table.

(6)	Represents estimated Company costs of dental and life insurance coverage based on fiscal 2013 actual amounts for the duration of the two year severance period. The amount excludes estimates for certain relocation costs from Japan to Ms. Merz’s residence in Canada upon termination.

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(1)	During fiscal 2013, Mr. Goodman was paid $95,000, which amount represents his annual cash retainer and his Audit Committee Chairman retainer. In addition, Mr. Goodman was granted an award of $100,000 of restricted stock units, which amount represents his annual grant for fiscal 2013.

(2)	During fiscal 2013, Mr. Markee was paid $37,500, which amount represents a pro rata annual cash retainer. In addition, Mr. Markee was granted $75,000 of restricted stock units, which amount represents his pro rata portion of his annual grant for fiscal 2013.

(3)	At the end of fiscal 2013, Mr. Goodman held 3,335 unvested restricted stock units. In addition, Mr. Goodman has deferred receipt of shares deliverable upon settlement of 3,409 restricted stock units, which were awarded for his services in Fiscal 2011 and 2012, until his resignation from the Company’s Board of Directors.

(4)

These amounts represent the aggregate grant date fair value of equity awards granted in fiscal 2013 as calculated pursuant to ASC 718 (excluding estimates of forfeitures related to service-based and performance-based vesting conditions). For additional information about the valuation assumptions with respect to equity awards, refer to Note 7 of the financial statements included in this Annual Report on Form 10-K entitled “STOCK-BASED COMPENSATION.”

(5)	At the end of fiscal 2013, Mr. Markee held 3,410 unvested restricted stock units.

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ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

*

For purposes of this table, “beneficial ownership” is determined in accordance with Rule 13d-3 under the Exchange Act pursuant to which a person or group of persons is deemed to have “beneficial ownership” of any shares of Common Stock with respect to which such person has (or has the right to acquire within 60 days, i.e., by April 30, 2014 in this case) sole or shared voting power or investment power.

(1)	Total Beneficial Ownership includes shares and options exercisable within 60 days, of which Mr. Urcelay and Mr. Creasey have 122,841.

(2)	Unless otherwise indicated, the beneficial ownership of any named person does not exceed, in the aggregate, one percent of our outstanding equity securities on March 1, 2014, as adjusted as required by applicable rules.

(3)

Includes shares held by Bain Capital (TRU) VIII, L.P., Bain Capital (TRU) VIII-E, L.P., Bain Capital (TRU) VIII Coinvestment, L.P., Bain Capital Integral Investors, LLC and BCIP TCV, LLC (collectively, the “Bain Capital Entities”). Bain Capital Investors, LLC (“BCI”) is the general partner of Bain Capital Partners VIII, L.P. which is the general partner of Bain Capital (TRU) VIII, L.P. and Bain Capital (TRU) VIII Coinvestment, L.P. BCI is also the general partner of Bain Capital Partners VIII E, L.P. which is the general partner of Bain Capital (TRU) VIII-E, L.P. BCI is also the Administrative Member of Bain Capital Integral Investors, LLC and BCIP TCV, LLC. By virtue of the relationships described above, each of the foregoing entities may be deemed to beneficially own the shares held by the Bain Capital Entities. Each such entity disclaims beneficial ownership of the shares held by the Bain Capital Entities except to the extent of its pecuniary interest therein. The address of each of the Bain entities is c/o BCI at 111 Huntington Avenue, Boston, MA 02199. Each of Joshua Bekenstein, Matthew S. Levin and Gregory R. Why is a managing director of BCI and a director of our Company. As a result, and by virtue of the relationships described in this footnote (3), each of Messrs. Bekenstein, Levin and Why may be deemed to be the beneficial owner of the shares held by the Bain Capital Entities. Each of Messrs. Bekenstein, Levin and Why disclaims beneficial ownership of the shares held by the Bain Capital Entities.

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(4)

Shares owned of record by Toybox Holdings, LLC are also beneficially owned by its majority member, KKR Millennium Fund L.P. As the sole general partner of KKR Millennium Fund L.P., KKR Associates Millennium L.P. may be deemed to be the beneficial owner of such securities beneficially owned by KKR Millennium Fund L.P. As the sole general partner of KKR Associates Millennium L.P., KKR Millennium GP LLC also may be deemed to be the beneficial owner of such securities beneficially owned by KKR Millennium Fund L.P. Each of KKR Fund Holdings L.P. (as the designated member of KKR Millennium GP LLC); KKR Fund Holdings GP Limited (as a general partner of KKR Fund Holdings L.P.); KKR Group Holdings L.P. (as a general partner of KKR Fund Holdings L.P. and the sole shareholder of KKR Fund Holdings GP Limited); KKR Group Limited (as the sole general partner of KKR Group Holdings L.P.); KKR & Co. L.P. (as the sole shareholder of KKR Group Limited) and KKR Management LLC (as the sole general partner of KKR & Co. L.P.) may also be deemed to be the beneficial owner of the securities beneficially owned by KKR Millennium Fund L.P. As the designated members of KKR Management LLC, Henry R. Kravis and George R. Roberts may also be deemed to beneficially own the securities beneficially owned by KKR Millennium Fund L.P. Messrs. Kravis and Roberts have also been designated as managers of KKR Millennium GP LLC by KKR Fund Holdings L.P. Messrs. Taylor and Waglay are members of our Board of Directors and are each an executive of Kohlberg Kravis Roberts & Co. L.P. and/or one or more of its affiliates. Each of Messrs. Taylor and Waglay disclaim beneficial ownership of the securities held by Toybox Holdings, LLC. For a description of material relationships between KKR and us over the last three years, see Item 13 entitled “Certain Relationships and Related Transactions and Director Independence” of this Annual Report on Form 10-K. The address of the entities listed above and Mr. Kravis, is c/o Kohlberg Kravis Roberts & Co. L.P., West 57th Street, Suite 4200, New York, New York 10019. For Messrs. Roberts, Taylor and Waglay, the address is c/o Kohlberg Kravis Roberts & Co. L.P., 2800 Sand Hill Road, Menlo Park, CA 94025. Mr. Calbert is a former executive of Kohlberg Kravis Roberts & Co. L.P. and disclaims beneficial ownership of the securities held by Toybox Holdings, LLC.

(5)

Represents shares of record held by Vornado Truck LLC. As the owner of 100% of the equity of Vornado Truck LLC, Vornado Realty L.P. may be deemed to be the beneficial owner of such shares. Also, as the sole general partner of Vornado Realty L.P., Vornado Realty Trust may be deemed to be the beneficial owner of such shares. Also, Messrs. Macnow and Guglielmone and Ms. Silverstein are members of our Board of Directors and also executives of Vornado Realty Trust. As such, these persons may be deemed to be beneficial owners of these shares. These persons disclaim beneficial ownership of shares held by Vornado Truck LLC. The address for each of these persons and entities is c/o Vornado Realty Trust, 888 Seventh Avenue, New York, New York 10019.

(1)	Represents the shares of our common stock issuable pursuant to outstanding options under the Management Equity Plan and the 2010 Incentive Plan.

(2)	Represents the shares of our common stock which may be issued pursuant to future issuances under the Management Equity Plan and the 2010 Incentive Plan.

ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

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ITEM 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES

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(1)	For fiscals 2013 and 2012, the audit fees consist of fees for professional services performed in connection with the audit of the Company’s annual consolidated financial statements, review of financial statements included in our 10-Q filings, the Sarbanes-Oxley Section 404 audit and services that are normally provided in connection with statutory and regulatory filings or engagements.

(2)	For fiscal 2013, audit-related fees consist primarily of fees related to special purpose audits. For fiscal 2012, audit-related fees consist primarily of fees related to the 144A offering and Toys “R” Us, Inc. Form S-4 for the issuance of the 2017 Notes and fees related to special purpose audits.

(3)	For fiscals 2013 and 2012, tax fees consist of a variety of U.S. Federal, state and non-U.S. tax consultation services.

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ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

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