BY-LAWS



                                       OF



                                 LECHTERS, INC.







                  As Amended April 11, 1991, January 11, 1994,
                     December 13, 1995 and November 15, 2000











<PAGE>




                                 LECHTERS, INC.
                            A New Jersey Corporation

                                     BY-LAWS

                            ------------------------

                                    ARTICLE I

                                  SHAREHOLDERS

        Section 1.1   Annual Meeting.
                      --------------

        An annual meeting of shareholders for the purpose of electing  directors
and of transacting  such other business as may come before it shall be held each
year at such date,  time,  and place  either  within or without the State of New
Jersey, as may be specified by the Board of Directors.

        Section 1.2   Special Meetings.
                      ----------------

        Special meetings of shareholders for any purpose or purposes may be held
at any time upon call of the Chairman of the Board, if any, the Vice Chairman of
the Board, if any, the Chief Executive Officer, the President,  or a majority of
the Board of  Directors,  at such time and place  either  within or without  the
State of New  Jersey as may be  stated  in the  notice.  A  special  meeting  of
shareholders shall be called by the President upon the written request,  stating
time,  place,  and the purpose or purposes of the meeting,  of shareholders  who
together own of record 25% of the outstanding  stock of all classes  entitled to
vote at such meeting.

        Section 1.3   Notice of Meetings.
                      ------------------

        Written notice of shareholders'  meetings,  stating the place, date, and
hour thereof, and, in the case of a special meeting, the purpose or purposes for
which the meeting is called,  shall be given by the  Chairman  of the Board,  if
any, the Vice Chairman of the Board,  if any, the Chief Executive  Officer,  the
President, any Vice President, the Secretary, or an Assistant Secretary, to each
shareholder  entitled to vote  thereat at least ten days but not more than sixty
days before the date of the meeting,  unless a different period is prescribed by
law.



                                        1
<PAGE>

        Section 1.4   Quorum.
                      ------

        Except as otherwise  provided by law or in the Restated  Certificate  of
Incorporation or these By-Laws, at any meeting of shareholders, the holders of a
majority of the  outstanding  shares of each class of stock  entitled to vote at
the meeting  shall be present or  represented  by proxy in order to constitute a
quorum for the  transaction  of any  business.  In the  absence  of a quorum,  a
majority in interest of the shareholders  present or the chairman of the meeting
may adjourn the meeting from time to time in the manner  provided in Section 1.5
of these By-Laws until a quorum shall attend.

        Section. 1.5  Adjournment.
                      -----------

        Any meeting of shareholders, annual or special, may adjourn from time to
time to reconvene at the same or some other place,  and notice need not be given
of any such adjourned meeting if the time and place thereof are announced at the
meeting  at which  the  adjournment  is taken.  At the  adjourned  meeting,  the
Corporation  may transact any business  which might have been  transacted at the
original  meeting.  If the adjournment is for more than thirty days, or if after
the adjournment a new record date is fixed for the adjourned  meeting,  a notice
of the adjourned  meeting shall be given to each  shareholder of record entitled
to vote at the meeting.

        Section 1.6   Organization.
                      ------------

        The Chairman of the Board,  if any, or in his absence the Vice  Chairman
of the Board,  or in their  absence  the Chief  Executive  Officer,  or in their
absence the  President,  or in their absence any Vice  President,  shall call to
order meetings of shareholders  and shall act as chairman of such meetings.  The
Board of Directors or, if the Board fails to act, the  shareholders  may appoint
any shareholder,  director,  or officer of the Corporation to act as chairman of
such  meetings.  The  Board of  Directors  or, if the  Board  fails to act,  the
shareholders  may  appoint  any  shareholder,   director,   or  officer  of  the
Corporation  to act as chairman of any meeting in the absence of the Chairman of
the Board,  the Vice Chairman of the Board,  the Chief  Executive  Officer,  the
President, and all Vice Presidents.
                                        2
<PAGE>

        The Secretary of the Corporation  shall act as secretary of all meetings
of  shareholders,  but, in the  absence of the  Secretary,  the  chairman of the
meeting may appoint any other person to act as secretary of the meeting.

        Section 1.7   Voting.
                      ------

        Except as otherwise  provided by law or in the Restated  Certificate  of
Incorporation or these By-Laws and except for the election of directors,  at any
meeting  duly  called and held at which a quorum is  present,  a majority of the
votes cast at such meeting upon a given  question by the holders of  outstanding
shares of stock of all  classes  of stock of the  Corporation  entitled  to vote
thereon who are present in person or by proxy shall decide such question. At any
meeting  duly called and held for the election of directors at which a quorum is
present,  directors  shall be  elected by a  plurality  of the votes cast by the
holders (acting as such) of shares of stock of the Corporation entitled to elect
such directors.


                                   ARTICLE II

                               BOARD OF DIRECTORS

        Section 2.1   Number and Term of Office.
                      -------------------------

        The business,  property, and affairs of the Corporation shall be managed
by or under the direction of a Board of between three and fifteen directors. The
Board shall be divided into three classes,  which are hereby designated Class A,
Class B and Class C. The term of office of the initial  Class A directors  shall
expire at the next annual meeting of  shareholders;  that of the initial Class B
directors at the second succeeding  annual meeting of shareholders;  and that of
the  initial  Class C  directors  at the  third  succeeding  annual  meeting  of
shareholders.  At each  annual  meeting  after  the  initial  classification  of
directors,  directors to replace those whose terms expire at such annual meeting
shall be elected to hold office until the third succeeding annual meeting.  Each
director  shall be elected by the holders of shares  entitled to vote thereon at
the annual meeting

                                        3
<PAGE>

of  shareholders,  to serve  (subject to the provisions of Article IV) until his
respective successor is elected and qualified.

        Section 2.2.  Chairman and Vice Chairman of the Board.
                      ---------------------------------------

        The directors may elect one of their members to be Chairman of the Board
of  Directors  and one of their  members  to be Vice  Chairman  of the  Board of
Directors. The Chairman and Vice Chairman shall be subject to the control of the
Board of  Directors.  They shall perform such duties as may from time to time be
assigned to them by the Board.

        Section 2.3   Meetings.
                      --------

        The  annual  meeting  of the Board of  Directors,  for the  election  of
officers  and the  transaction  of such other  business  as may come  before the
meeting,  shall be held  without  notice  at the same  places,  and  immediately
following, the annual meeting of the shareholders.
        Regular meetings of the Board of Directors may be held without notice at
such time and place as shall from time to time be determined by the Board.
        Special  meetings of the Board of  Directors  shall be held at such time
and place as shall be designated in the notice of the meeting whenever called by
the  Chairman  of the  Board,  if any,  the Vice  Chairman,  if any,  the  Chief
Executive  Officer,  the  President,  or by a majority of the directors  then in
office.

        Section 2.4   Notice of Special Meetings.
                      --------------------------

        The Secretary,  or in his absence any other officer of the  Corporation,
shall  give each  director  notice of the time and place of  holding  of special
meetings  of the  Board of  Directors  by mail at least  five  days  before  the
meeting,  or by telecopy,  telegram,  cable,  radiogram,  or personal service at
least two days  before  the  meeting.  Unless  otherwise  stated  in the  notice
thereof,  any  and  all  business  may  be  transacted  at any  meeting  without
specification of such business in the notice.



                                        4
<PAGE>

        Section 2.5   Quorum and Organization of Meetings.
                      -----------------------------------

        A majority of the total  number of members of the Board of  Directors as
constituted  from time to time shall  constitute a quorum for the transaction of
business.  Except as otherwise provided by law or in the Restated Certificate of
Incorporation  or these  By-Laws,  a majority  of the  directors  present at any
meeting at which a quorum is present may decide any question brought before such
meeting.  Meetings shall be presided over by the Chairman of the Board,  if any,
or in his absence by the Vice Chairman of the Board, if any, or in their absence
by the  President,  or in the  absence  of  both  by such  other  person  as the
directors may select. The Secretary of the Corporation shall act as secretary of
the  meeting,  but in his  absence  the  chairman of the meeting may appoint any
person to act as secretary of the meeting.

        Section 2.6   Committees.
                      ----------

        The Board of Directors  may, by  resolution  passed by a majority of the
whole Board, designate one or more committees,  each committee to consist of one
or more of the directors of the Corporation. The Board may designate one or more
directors as alternate  members of any committee,  who may replace any absent or
disqualified member at any meeting of the committee.  Any such committee, to the
extent provided in the resolution of the Board of Directors,  shall have and may
exercise  all  the  powers  and  authority  of the  Board  of  Directors  in the
management of the business,  property,  and affairs of the Corporation,  and may
authorize  the seal of the  Corporation  to be affixed  to all papers  which may
require it; but no such committee  shall have power or authority in reference to
amending the Restated  Certificate of Incorporation  of the Corporation  (except
that a committee may, to the extent  authorized in the resolution or resolutions
providing  for the issuance of shares of stock adopted by the Board of Directors
pursuant  to  authority  expressly  granted  to the  Board of  Directors  by the
Corporation's Restated Certificate of Incorporation,  fix any of the preferences
or rights of such shares  relating to dividends,  redemption,  dissolution,  any
distribution  of assets  of the  Corporation,  or the  conversion  into,  or the
exchange of such  shares for,  shares of any other class or classes or any other
series of the same or any other  class or classes of stock of the  Corporation),
adopting any action that

                                        5
<PAGE>

requires  approval of the  shareholders,  electing or appointing any director or
removing any officer or director,  amending or repealing any resolution  adopted
by the Board of Directors  that by its terms is amendable or repealable  only by
the Board,  or making,  altering or repealing  these  By-Laws;  and,  unless the
resolution  expressly so  provided,  no such  committee  shall have the power or
authority  to declare a dividend,  or to authorize  the issuance of stock.  Each
committee  which may be established by the Board of Directors  pursuant to these
By-Laws may fix its own rules and procedures.  Notice of meetings of committees,
other  than of regular  meetings  provided  for by the rules,  shall be given to
committee  members.  All action taken by committees shall be recorded in minutes
of the meetings.

        Section 2.7   Action Without Meeting.
                      ----------------------

        Nothing contained in these By-Laws shall be deemed to restrict the power
of members of the Board of Directors or any committee designated by the Board to
take any action required or permitted to be taken by them without a meeting.

        Section 2.8   Telephone Meetings.
                      ------------------

        Nothing contained in these By-Laws shall be deemed to restrict the power
of members of the Board of Directors,  or any committee designated by the Board,
to participate in all or part of a meeting of the Board, or committee,  by means
of conference  telephone or similar  communications  equipment by means of which
all persons participating in the meeting can hear each other.

                                   ARTICLE III

                                    OFFICERS


        Section 3.1   Executive Officers.
                      ------------------

        The executive  officers of the  Corporation  shall be a Chief  Executive
Officer  and/or a President,  one or more Vice  Presidents,  a Treasurer,  and a
Secretary, each of whom shall be elected by the Board of Directors.
The Board of  Directors  may elect or appoint such other  officers  (including a
Chairman of the Board, a Vice
                                        6
<PAGE>

Chairman of the Board,  a Controller  and one or more  Assistant  Treasurers and
Assistant Secretaries) as it may deem necessary or desirable. Each officer shall
hold office for such term as may be  prescribed  by the Board of Directors  from
time to time.  Any  person  may hold at one  time  two or more  offices,  but no
officer shall  execute,  acknowledge  or verify any instrument in more than, one
capacity  if such  instrument  is  required  by law or by  these  By-Laws  to be
executed, acknowledged or verified by two or more officers.

        Section 3.2   Powers and Duties.
                      -----------------

        The Chairman of the Board, if any, or, in his absence, the Vice Chairman
of the Board,  if any, or in their absence the Chief  Executive  Officer,  or in
their absence the President,  shall preside at all meetings of the  shareholders
and of the Board of Directors. In the absence of the President, a Vice President
appointed by the President or, if the President fails to make such  appointment,
by the Board,  shall perform all the duties of the  President.  The officers and
agents of the  Corporation  shall each have such powers and  authority and shall
perform such duties in the management of the business,  property, and affairs of
the Corporation as generally  pertain to their  respective  offices,  as well as
such  powers  and  authorities  and  such  duties  as from  time to time  may be
prescribed by the Board of Directors.

                                           RESIGNATIONS, REMOVALS, AND VACANCIES

        Section 4.1   Resignations.
                      ------------

        Any  director  or  officer  of the  Corporation,  or any  member  of any
committee,  may  resign  at any time by  giving  written  notice to the Board of
Directors,  the Chief Executive Officer, the President,  or the Secretary of the
Corporation.  Any such  resignation  shall  take  effect  at the time  specified
therein or, if the time be not specified therein, then upon receipt thereof. The
acceptance of such resignation shall not be necessary to make it effective.
        Section 4.2   Removals.
                      --------

        The Board of Directors,  by a vote of not less than a  majority  of  the
entire Board, at any meeting

                                        7
<PAGE>

thereof,  or by written  consent,  at any time, may, to the extent  permitted by
law, remove with or without cause from office or terminate the employment of any
officer or member of any committee and may, with or without  cause,  disband any
committee.
        Unless otherwise provided in the Restated  Certificate of Incorporation,
the  holders  of  two-thirds  of the shares  entitled  at the time to vote at an
election of directors may remove any director with cause, but may not remove any
director  without  cause.  The  Board of  Directors,  by a vote of not less than
two-thirds of the entire Board, at any meeting  thereof,  or by written consent,
at any time,  may, to the extent  permitted  by law,  remove any  director  with
cause, but may not remove a director without cause.

        Section 4.3   Vacancies.
                      ---------

        Subject to the provisions of the Restated  Certificate of Incorporation,
any vacancy in the office of any director or officer through death, resignation,
removal,  disqualification,  or other  cause,  and any  additional  directorship
resulting from increase in the number of directors, may be filled at any time by
two-thirds  of the  directors  then in office  (even  though  less than a quorum
remains).  The person so chosen  shall  hold  office  until the next  succeeding
annual meeting of  shareholders  and until his successor shall have been elected
and  qualified.  Any  directorship  not filled by the Board of Directors  may be
filled  by  the  shareholders  at  an  annual  meeting  or  special  meeting  of
shareholders called for that purpose.

                                    ARTICLE V
                                  CAPITAL STOCK
        Section 5.1   Stock Certificates.
        The  certificates  for shares of the  capital  stock of the  Corporation
shall be in such form as shall be prescribed  by law and approved,  from time to
time, by the Board of Directors.


                                        8
<PAGE>

        Section 5.2   Transfer of Shares.
        Shares of the capital stock of the Corporation may be transferred on the
books  of the  Corporation  only by the  holder  of such  shares  or by his duly
authorized attorney, upon the surrender to the Corporation or its transfer agent
of the certificate representing such stock properly endorsed.

        Section 5.3   Fixing Record Date.
        In order that the Corporation may determine the shareholders entitled to
notice of or to vote at any meeting of shareholders  or any adjournment  thereof
or to express  consent to  corporate  action in  writing  without a meeting,  or
entitled to receive  payment of any dividend or other  distribution or allotment
of any rights,  or  entitled  to  exercise  any rights in respect of any change,
conversion, or exchange of stock, or for the purpose of any other lawful action,
the Board of  Directors  may fix,  in  advance,  a record  date,  which,  unless
otherwise  provided by law,  shall not be more than sixty nor less than ten days
before  the date of such  meeting,  nor more than  sixty days prior to any other
action.

        Section 5.4   Lost Certificates.
        The Board of  Directors  or any transfer  agent of the  Corporation  may
direct a new certificate or certificates  representing  stock of the Corporation
to be issued in place of any certificate or certificates  theretofore  issued by
the  Corporation,  alleged to have been lost,  stolen,  or  destroyed,  upon the
making of an affidavit of that fact by the person claiming the certificate to be
lost, stolen, or destroyed.  When authorizing such issue of a new certificate or
certificates,  the Board of Directors (or any transfer agent of the  Corporation
authorized  to do so by a  resolution  of the Board of  Directors)  may,  in its
discretion  and as a condition  precedent to the issuance  thereof,  require the
owner of such lost,  stolen,  or destroyed  certificate or certificates,  or his
legal representative, to give the Corporation a bond in such sum as the Board of
Directors (or any transfer  agent so  authorized)  shall direct to indemnify the
Corporation against any claim that may be made

                                        9
<PAGE>

against the  Corporation  with respect to the  certificate  alleged to have been
lost,  stolen, or destroyed or the issuance of such new  certificates,  and such
requirement may be general or confined to specific instances.

        Section 5.5   Regulations.
        The Board of Directors  shall have power and  authority to make all such
rules and regulations as it may deem expedient  concerning the issue,  transfer,
registration,  cancellation,  and replacement of certificates representing stock
of the Corporation.

                                   ARTICLE VI
                                  MISCELLANEOUS

        Section 6.1   Corporate Seal.

        The  corporate  seal  shall  have  inscribed  thereon  the  name  of the
Corporation  and shall be in such form as may be  approved  from time to time by
the Board of Directors.

        Section 6.2   Fiscal Year.
        The 1995  fiscal  year  shall  begin on  January  29,  1995,  and end on
February 3, 1996. Each  subsequent  fiscal year shall begin on the day following
the  expiration of the prior fiscal year,  and end during the next calendar year
on: (i)  January  31, if January 31 is a  Saturday,  (ii) the last  Saturday  in
January  if  January  31 is a  Sunday,  Monday  or  Tuesday,  or (iii) the first
Saturday in February, if January 31 is a Wednesday, Thursday or Friday.

        Section 6.3   Notices and Waivers Thereof.
        Whenever   any  notice   whatever  is  required  by  law,  the  Restated
Certificate of  Incorporation,  or these By-Laws to be given to any shareholder,
director, or officer, such notice, except as otherwise provided by law,

                                       10
<PAGE>

may be given  personally,  or by mail, or, in the case of directors or officers,
by telecopy, telegram, cable, or radiogram, addressed to such address as appears
on the books of the Corporation.  Any notice given by telecopy, telegram, cable,
or  radiogram  shall be  deemed  to have  been  given  when it shall  have  been
delivered for  transmission and any notice given by mail shall be deemed to have
been given  when it shall have been  deposited  in the United  States  mail with
postage thereon prepaid.
        Whenever  any  notice  is  required  to be  given by law,  the  Restated
Certificate of Incorporation, or these By-Laws, a written waiver thereof, signed
by the person  entitled to such notice,  whether  before or after the meeting or
the time stated  therein,  shall be deemed  equivalent  in all  respects to such
notice to the full extent permitted by law.

        Section 6.4   Stock of Other Corporations or Other Interests.
                      -----------------------------------------------
        Unless otherwise ordered by the Board of Directors,  the Chairman of the
Board,  the Chief  Executive  Officer,  the President,  the Secretary,  and such
attorneys or agents of the Corporation as may be from time to time authorized by
the Board of Directors  or the Chairman of the Board,  shall have full power and
authority on behalf of this  Corporation to attend and to act and vote in person
or by proxy at any meeting of the holders of  securities of any  corporation  or
other  entity  in  which  this  Corporation  may own or  hold  shares  or  other
securities,  and at such meetings  shall possess and may exercise all the rights
and powers  incident to the ownership of such shares or other  securities  which
this  Corporation,  as the owner or holder  thereof,  might have  possessed  and
exercised if present.  The Chairman of the Board,  the Chief Executive  Officer,
the President,  the Secretary, or such attorneys or agents, may also execute and
deliver on behalf of this  Corporation  powers of attorney,  proxies,  consents,
waivers,  and other  instruments  relating to the shares or securities  owned or
held by this Corporation.



                                       11
<PAGE>

                                   ARTICLE VII
                                   AMENDMENTS
        The holders of shares  entitled at the time to vote for the  election of
directors  shall  have  power to adopt,  amend,  or repeal  the  By-Laws  of the
Corporation  by vote of not less than a majority of such  shares,  and except as
otherwise  provided by law, the Board of Directors shall have power equal in all
respects to that of the  shareholders to adopt,  amend, or repeal the By-Laws by
vote of not less than a  majority  of the  entire  Board.  However,  any  By-Law
adopted  by the Board may be  amended or  repealed  by vote of the  holders of a
majority  of the  shares  entitled  at the  time to vote  for  the  election  of
directors.




                                       12
<PAGE>