Exhibit 10.2

 

SALE GUIDELINES

 

Exhibit 8.1

To

Agency Agreement

 

- And -

 

Exhibit C

To

Approval Order

 

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EXHIBIT 8.1

 

STORE CLOSING GUIDELINES

 

The following procedures shall apply to the Sale1 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. 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 const 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 shall be
performed 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

 

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GARDERE WYNNE SEWELL LLP

 

1601 Elm Street, Suite 3000

 

Dallas, TX 75201

 

Attn:

Stephen A. McCartin, Esq.

 

 

Randy Ray, Esq.

 

Fax:

(214) 999-3544

 

Email:

smccartin@gardere.com

 

 

rray@gardere.com

 

 

 

MORGAN, LEWIS & BOCKIUS LLP

 

101 Park Avenue

 

New York, NY 10178

 

Attn:

Neil E. Herman, Esq.

 

Fax:

(212) 309-6001

 

Email:

nherman@morganlewis.com

 

 

If to the Agent:

SB CAPITAL GROUP, LLC

 

1010 Northern Blvd, Suite 340

 

Great Neck, NY 11021

 

Attn:

Robert Raskin

 

Tel:

(516) 829-2400

 

Fax:

(516) 829-2404

 

Email:

rraskin@sbcapitalgroup.com

 

 

 

TIGER CAPITAL GROUP, LLC

 

84 State Street, Suite 420

 

Boston, MA 02109

 

Attn:

Steve Goldberger

 

 

Dan Kane

 

Tel:

(617) 523-7002

 

Fax:

(617) 523-3007

 

Email:

sgoldberger@tigercapitalgroup.com

 

 

dkane@tigercapitalgroup.com

 

 

With a copy to:

WACHTELL, LIPTON, ROSEN & KATZ

 

51 West 52nd Street

 

New York, NY 10019

 

Attn:

Scott Charles

 

 

Josh Feltman

 

Tel:

(212) 403-1200

 

Fax:

(212) 403-2200

 

Email:

skcharles@wlrk.com

 

 

jafeltman@wlrk.com

 

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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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