Exhibit 10.2

 

EXHIBIT 8.1

 

STORE CLOSING GUIDELINES

 

The following procedures shall apply to the Sale(1) to be held at the closing
Stores and the disposal of the Owned FF&E in the closing Stores:

 

1.             The Sale shall be conducted so that the closing Stores in which
sales are to occur remain open no longer than the normal hours of operation
provided for in the respective leases or other occupancy agreements for the
closing Stores.

 

2.             The Sale shall be conducted in accordance with applicable state
and local “Blue Laws,” and thus, where applicable, no Sale shall be conducted on
Sunday unless the Merchant had been operating such Stores on a Sunday.

 

3.             All display and hanging signs used by the Merchant and the Agent
in connection with Sale shall be professionally produced and all hanging signs
shall be hung in a professional manner. The Merchant and the Agent may advertise
the Sale as a “sale on everything”, “store closing”, or similar theme sale at
the closing Stores as provided by the Agency Agreement.  Neither the Merchant,
nor the Agent shall advertise the Sale as a “going-out-of-business” sale.  The
Merchant and the Agent shall not use neon or day-glo signs. Furthermore, with
respect to enclosed mall locations no exterior signs or signs in common areas of
a mall shall be used. Nothing contained herein shall be construed to create or
impose upon the Merchant and the Agent any additional restrictions not contained
in the applicable lease or other occupancy agreement. In addition, the Merchant
and the Agent shall be permitted to utilize exterior banners at non-enclosed
mall Stores; provided, however, that such banners shall be located or hung so as
to make clear that the Sale is being conducted only at the affected store and
shall not be wider than the closing Storefront of the closing Store and such
signage shall not be larger than 4 feet by 40 feet. In addition, the Merchant
and the Agent shall be permitted to utilize sign walkers and street signage,
notwithstanding any state, county or local law or ordinance; provided however
the use of sign walkers and use of street signage shall be done in a safe manner
and shall not be permitted on mall or shopping center property.

 

4.             Conspicuous signs shall be posted in the cash register areas of
each Store to the effect that all sales are “final” and that customers with any
questions or complaints subsequent to the conclusion of the Sale may contact a
named representative of the Merchant or the Agent at a specified telephone
number.  Agent shall make available consumers inserts identifying that that the
manufacturer’s warranty, if any, may still exist and you should consult the
packaging materials to see what, if any, manufacturer’s warranties are
available, and Agent shall instruct the cashiers to place such inserts in the
consumer’s shopping bag.

 

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(1)  Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Agency Agreement.

 

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5.             Within a “Shopping Center”, the Agent shall not distribute
handbills, leaflets or other written materials to customers outside of any of
the closing Stores, unless permitted by the applicable lease or, if distribution
is customary in the shopping center in which the closing Store is located.
Otherwise, the Agent may solicit customers in the closing Stores themselves. The
Agent shall not use any flashing lights or amplified sound to advertise the Sale
or solicit customers, except as permitted under the applicable lease or agreed
to by the landlord.

 

6.             At the conclusion of the Sale, Agent shall vacate the closing
Stores in “broom-clean” condition, and shall otherwise leave the closing Stores
in the same condition as on the commencement of the Sale, ordinary wear and tear
excepted; provided, however, that the Merchant and Agent hereby do not undertake
any greater obligation than as set forth in an applicable lease with respect to
a Stores. The Merchant may abandon any FF&E or other materials (the “Abandoned
Property”) not sold in the Sale at the closing Store premises at the conclusion
of the Sale. Any Abandoned Property left in a Store after a lease is rejected
shall be deemed abandoned with the landlord having the right to dispose of the
same as the landlord chooses without any liability whatsoever on the part of the
landlord to any party and without waiver of any damage claims against the
Merchant.

 

7.             Subject to the provisions of Section 15.9 of the Agency
Agreement, the Agent shall have the right to sell Owned FF&E located in the
closing Stores; provided, however, Merchant shall have the right (subject to the
consent of the Indenture Trustee and the Noteholders), at any time prior to the
date that is fourteen days after the Sale Commencement Date, to designate
certain FF&E located in the closing Stores that Merchant intends to keep for its
own use and which Agent shall not be permitted or entitled to sell. The Agent
may advertise the sale of the Owned FF&E consistent with the guidelines provided
in paragraphs 4 and 6 hereof. Additionally, the purchasers of any Owned FF&E
sold during the Sale shall only be permitted to remove the Owned FF&E either
through the back shipping areas or through other areas after store business
hours.  For the avoidance of doubt, as of the Sale Termination Date, Agent may
abandon, in place, and without further responsibility, any unsold FF&E located
at the closing Stores.

 

8.             The Agent shall not make any alterations to interior or exterior
Store lighting. No property of any landlord of a Store shall be removed or sold
during the Sale. The hanging of exterior banners or other signage shall not
constitute an alteration to a Store.

 

9.             At the conclusion of the Sale at each Store, pending assumption
or rejection of applicable leases, the landlords of the closing Stores shall
have reasonable access to the closing Store premises as set forth in the
applicable leases. The Merchant, the Agent and their agents and representatives
shall continue to have exclusive and unfettered access to the closing Stores.

 

10.           Post-petition rents shall be paid by the Merchant as required by
the Bankruptcy Code until the rejection or assumption and assignment of each
lease.

 

11.           The rights of the landlords for any damages to the closing Stores
shall be reserved in accordance with the applicable leases.

 

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12.           The Merchant shall notify a representative of the relevant
landlord of the date on which the Sale is scheduled to conclude at a given
Store, within three business days of the Merchant’s receipt of such notice from
the Agent.

 

13.           To the extent that any Store landlord affected hereby contends
that the Merchant is in breach or default under these Store Closing Guidelines,
such landlord shall provide at least five (5) days’ written notice, served by
facsimile and overnight delivery, on the Merchant and the Merchant’s counsel,
and the Agent and the Agent’s counsel, at the following facsimile numbers and
addresses:

 

If to the Merchant:

LINENS HOLDING CO.

 

6 Brighton Road

 

Clifton, NJ 07012

 

Attn:

Frank Rowan

 

 

Dave Coder

 

Fax:

(973) 836-0309

 

Email:

frowan@lnt.com

 

 

dcoder@lnt.com

 

 

 

With a copy to:

ASSET DISPOSITION ADVISORS, LLC

 

499 Park Avenue

 

New York, NY 10022

 

Attn:

Paul Traub

 

 

Steven Fox

 

Tel:

(212) 573-9084

 

Fax:

(212) 652-3863

 

 

 

 

RICHARDS, LAYTON, & FINGER, P.A.

 

920 N. King Street

 

Wilmington, DE 19801

 

Attn:

Mark D. Collins

 

 

Michael J. Merchant

 

Tel:

(302) 651-7700

 

Fax:

(302) 651-7701

 

Email:

Collins@rlf.com

 

 

Merchant@rlf.com

 

 

 

If to the Agent:

[insert]

 

If the parties are unable to resolve the dispute between themselves, either the
landlord or the Merchant shall have the right to schedule a “status hearing”
before the Bankruptcy Court on no less than five (5) days notice to the other
parties.

 

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