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                               LECHTERS - OFFICE
                            MEMORANDUM OF AGREEMENT

      WHEREAS, the parties have met to modify the contract with an intent to
provide better benefits to the office personnel employed by Lechters, it is
hereby agreed, by and between Local 99 UNITE and Lechters, Inc., to modify the
existing collective bargaining agreement ("Agreement"), whose term is July 1,
1997 to June 30, 2000.

      NOW, THEREFORE, it is agreed:

      1. Paragraph 21, "Severance Fund - Termination or Dismissal of Benefits"
shall be modified as follows:

            a. Effective January 1, 1998, subsection "a" shall be modified in
that the contribution rate shall be changed from 1/2% to 0%.

            b. The following paragraph shall be inserted as subsection "g" and
the paragraphs following shall be re-lettered to effect this change.

            g. The amount of benefits due from the Fund shall equal the average
            base weekly salary of each covered employee as of December 31st of
            the year prior to termination, multiplied by every full year of
            employment as of December 31 of the year prior to termination (with
            six (6) months or more in an employment in the prior year rounded to
            the next higher year and less than six (6) months of employment in
            the prior year rounded to the last full year.) Such payment,
            however, is not to exceed the relative proportion of Trust assets as
            reported as of December 31st of the last calendar year that covered
            employees entitled to receive such benefits as a result of
            termination compares to the total number of covered employees
            liabilities for all workers under the Plan who would be entitled to
            receive benefits in the event of a total shutdown.

            For the purpose of determining the aforesaid "average base weekly
            salary" for computation of benefits herein, the average base salary
            wage of the covered employee shall be determined by multiplying the
            employee's regular hourly base wage effective as of the December
            31st preceding the date of termination, multiplied by the number of
            regular weekly work hours in a week under the 
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            collective bargaining agreement for full-time employees (i.e., 35
            hours/week) and for employees who are not full-time employees, the
            number of hours in a regular work week shall be the average number
            of hours that the employee worked each week during the twenty-six
            (26) weeks immediately preceding the date of termination.

      2. Effective January 1, 1998, paragraph 20 "Benefit Funds," subsection "c"
shall be modified to increase by 1/2% the contribution required to be made gross
weekly payroll to the Health and Welfare Fund for benefits provided to
participants.

      3. Eliminate all unessential administrative costs except for essential
expenses such as audit expenses, tax report filings (Form 5500) and related
expenses. [Fund to pay all administrative expenses.]

      4. Increase efforts in achieving investment return on fund assets. 

      5. In all other respects the Agreement is confirmed.

AGREED AND ACCEPTED:
LECHTERS, INC.

By:_________________________________            ______________________________
                                                Dated

AGREED AND ACCEPTED:
LOCAL 99, UNITE

By:_________________________________            ______________________________
                                                Dated


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