1. NATURE OF OPERATIONS

        The Bon-Ton Stores, Inc. is a Pennsylvania corporation incorporated on January 31, 1996 as the successor of a company incorporated on January 31, 1929. As of January 30, 2016, The Bon-Ton Stores, Inc. operated, through its subsidiaries, 268 stores, including nine furniture galleries and four clearance centers, in 26 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's and Younkers nameplates.

        References to "the Company" refer to The Bon-Ton Stores, Inc. (the "Parent") and its subsidiaries.

        The Company's fiscal year ends on the Saturday nearer January 31, and consisted of 52 weeks for each of 2015, 2014 and 2013. References to "2015," "2014" and "2013" represent the Company's fiscal 2015 year ended January 30, 2016, fiscal 2014 year ended January 31, 2015 and fiscal 2013 year ended February 1, 2014, respectively. References to "2016" represent the Company's fiscal 2016 year ending January 28, 2017.