Linens n Things Files Voluntary Petition Under Chapter 11 to Complete Financial Restructuring

Home Furnishing Chain Remains Open For Business without Interruption; Company Secures $700 million in DIP Financing from General Electric Capital Corp.

Restructuring Plan Includes Closure of 120 Underperforming Stores

Company Chairman & CEO Robert DiNicola to become Executive Chairman; Financial Restructuring Expert, Michael Gries, Named Chief Restructuring Officer and Interim CEO

CLIFTON, N.J.--(BUSINESS WIRE)--Linens Holding Co. (LNT or the Company), a leading home furnishings specialty retailer operating as Linens n Things, announced today that the Company and its U.S. subsidiaries have filed a voluntary petition under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. The national home furnishings chain will continue to operate its stores without interruption during the reorganization and the stores are open for business and expect to be well stocked with merchandise. The filing pertains only to LNTs operations in the United States. The Companys Canadian stores, which are among the strongest performers in the chain, are not included in the filing and there are no plans for a similar filing in Canada.

“As we move forward with LNT’s restructuring, the Board and I concluded that we needed to have additional restructuring expertise on our executive team”

The decision to file for Chapter 11 protection was driven largely by the impact of the current economic downturn on the Companys operating performance. Filing for Chapter 11 provides the Company with the tools to restructure its balance sheet, close under-performing store locations, revisit certain agreements and position the Company for long-term success. LNT has requested immediate authorization and expects approval from the Court to continue paying employee salaries and benefits as well as to honor gift cards and store credits as normal.

LNT has secured $700 million in debtor-in-possession (DIP) financing from General Electric Capital Corp., which will ensure healthy merchandise flow as the Company prepares for the back-to-school and holiday selling seasons. The Company has been working closely with key vendors, who have been supporting the Company with new merchandise in recent weeks. The DIP facility will allow the Company to normalize relations with the larger vendor community. The Company believes the DIP facility will provide adequate working capital to meet its ongoing obligations during the restructuring.

The significant deterioration in the mortgage, housing and credit markets and the resulting impact on the retail marketplace, particularly the home sector, has overwhelmed the operating and merchandising improvements that we have made over the past two years, said Robert J. DiNicola, Executive Chairman. We are making the strategic decision to use a Chapter 11 filing to proactively address our capital structure and ensure that our stores will remain well stocked while we work through the steps to align the capital structure of the Company with the realities of todays business environment. At the store level, we remain fully operational and ready to serve our guests.

The Company also announced that as part of its financial restructuring it plans to close 120 underperforming stores. (See attached list).

The decision to close stores was difficult but necessary to improve LNTs financial position and place the Company on a firmer financial footing as we move forward, stated Mr. DiNicola. We will be able to realize important cost savings and operational efficiencies as a result of this process, allowing us to serve all our constituencies more effectively.

In order to help effectuate the Companys financial restructuring, LNTs Board of Directors has named Michael F. Gries, a noted financial restructuring expert and Co-Founder of Conway Del Genio Gries & Co., Chief Restructuring Officer and Interim CEO. Mr. DiNicola, the Companys current Chairman and CEO, will become Executive Chairman. David Coder, currently Executive Vice President, Store Operations, has been appointed President and Chief Operating Officer of LNT.

As we move forward with LNTs restructuring, the Board and I concluded that we needed to have additional restructuring expertise on our executive team, added Mr. DiNicola. Michael Gries is as good as it gets in this area, a nationally recognized leader with the deep experience in driving the financial initiatives necessary to position our Company for the future. I look forward to working with him to help LNT reach its full potential. I am also particularly pleased about Dave Coders promotion. He has been a key part of our past success and the operational strides we have made and will be integral in our reorganization efforts.

Linens n Things, with 2007 sales of approximately $2.8 billion, is one of the leading, national large format retailers of home textiles, housewares and home accessories. As of December 29, 2007, Linens n Things operated 589 stores in 47 states and seven provinces across the United States and Canada. More information about Linens n Things can be found online at www.lnt.com.

Forward-Looking Statements

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to our financial condition, results of operations and business that is not historical information. As a general matter, forward-looking statements are those focused upon future or anticipated events or trends and expectations and beliefs relating to matters that are not historical in nature. The words believe, expect, plan, intend, estimate or anticipate and similar expressions, as well as future or conditional verbs such as will, should, would and could, often identify forward-looking statements. The Company believes there is a reasonable basis for our expectations and beliefs, but they are inherently uncertain, and we may not realize our expectations and our beliefs may not prove correct. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. The Companys actual results and future financial condition may differ materially from those described or implied by any such forward-looking statements as a result of many factors that may be outside the Companys control. Such factors include, without limitation: general economic conditions; changes in the retailing environment and consumer spending habits; inclement weather and natural disasters; competition from existing and potential competitors; the amount of merchandise markdowns; loss or retirement of key members of management; increases in the costs of borrowings and unavailability of additional debt or equity capital; impact of our substantial indebtedness on our operating income and our ability to grow; the cost of labor; labor disputes; increased healthcare benefit costs; and other costs and expenses. This list of factors is not intended to be exhaustive.

Linens n Things Store Closing List

   

SHOPPING CENTER

 

CITY

 

STATE

SPRINGDALE MALL   MOBILE   AL
ARIZONA MILLS   TEMPE   AZ
YUMA PALMS REGIONAL SHOPPING   YUMA   AZ
LONE TREE PLAZA   BRENTWOOD   CA
CERRITOS TOWN CENTER   CERRITOS   CA
CHINO SPECTRUM MARKETPLACE II   CHINO   CA
PUENTE HILLS MALL   CITY OF INDUSTRY   CA
CORONA HILLS PLAZA   CORONA   CA
WESTLAKE   DALY CITY   CA
HUNTERS RIDGE TOWN CENTER   FONTANA   CA
PACIFIC COMMONS   FREMONT   CA
AMERIGE HEIGHTS TOWN CENTER   FULLERTON   CA
PACHECO PLAZA   GILROY   CA
GLENDALE MARKETPLACE   GLENDALE   CA
OLYMPIC & SAWTELLE   LOS ANGELES   CA
SANTA MARGARITA TOWN CENTER   MARGARITA   CA
SISK ROAD CENTER   MODESTO   CA
MONTCLAIR PLAZA   MONTCLAIR   CA
THE MOORPARK MARKETPLACE   MOORPARK   CA
THE SHOPS ON SOUTH LAKE STREET   PASADENA   CA
PLEASANT HILL   PLEASANT HILL   CA
CANYON SPRINGS   RIVERSIDE   CA
THE PROMENADE OF NATOMAS   SACRAMENTO   CA
OAKRIDGE MALL   SAN JOSE   CA
STEVENS CREEK CENTRAL SHOPPING CTR.   SAN JOSE   CA
RIVERSIDE SHOPPING CENTER   SHERMAN OAKS   CA
TRACY   TRACY   CA
THE MARKET PLACE   TUSTIN   CA
DYER STREET TRIANGLE   UNION CITY   CA
FALLBROOK CENTER   WEST HILLS   CA
ARAPAHOE CROSSINGS   AURORA   CO
BROOMFIELD VILLAGE   BROOMFIELD   CO
QUEBEC SQUARE   DENVER   CO
BELMAR SHOPPING CENTER   LAKEWOOD   CO
FARMINGTON   FARMINGTON   CT
LISBON LANDING   LISBON   CT
MARKETPLACE AT ALTAMONTE   ALTAMONTE SPRINGS   FL
AVENTURA   AVENTURA   FL
BOCA RATON   BOCA RATON   FL
THE SHOPPES AT DADELAND   MIAMI   FL
LNT SHOPPING CENTER   VERO BEACH   FL
CROSS COUNTY PLAZA   W. PALM BEACH   FL
PERIMETER MALL   ATLANTA   GA
UPTOWN SQUARE SHOPPING CENTER   FAYETTEVILLE   GA
STONECREST MARKETPLACE   LITHONIA   GA
 

SHOPPING CENTER

 

CITY

 

STATE

MACON MALL   MACON   GA
SOUTHLAKE PAVILLION   MORROW   GA
GRAND TETON MALL   IDAHO FALLS   ID
NORTH MICHIGAN AVE   CHICAGO   IL
DEER GROVE CENTER   PALATINE   IL
THE PROMENADE VENTURE II   SCHAUMBURG   IL
ORCHARD PLACE SHOPPING CENTER   SKOKIE   IL
UNIVERSITY CENTER   MISHAWAKA   IN
THE LEGENDS AT VILLAGE WEST   KANSAS CITY   KS
ORCHARD CORNERS   LENEXA   KS
INDEPENDENCE MALL   KINGSTON   MA
BERKSHIRE MALL   LANESBORO   MA
KING PHILLIPS CROSSING   SEEKONK   MA
THE CAPITAL CENTER   LARGO   MD
BANGOR PARKADE   BANGOR   ME
THE SHOPS AT BIDDEFORD CROSSING   BIDDEFORD   ME
RIVERTOWN MARKETPLACE   GRANDVILLE   MI
CENTERPOINT MALL   KENTWOOD   MI
MILLENIUM PARK   LIVONIA   MI
NOVI TOWN CENTER   NOVI   MI
BALDWIN COMMONS   ORION TOWNSHIP   MI
WINCHESTER MALL   ROCHESTER HILLS   MI
TROY MARKETPLACE   TROY   MI
THE GATEWAY   W. BLOOMFIELD TWP.   MI
ALPINE SUMMIT   WALKER   MI
APACHE SHOPPES   ROCHESTER   MN
WOODBURY LAKES   WOODBURY   MN
HARTMAN HERITAGE CENTER   INDEPENDENCE   MO
STATELINE STATION S/C   KANSAS CITY   MO
BARRY TOWNE CENTER   KANSAS CITY   MO
MENARD'S PLAZA   WEST FARGO   ND
SORENSON PARKWAY PLAZA   OMAHA   NE
HOWELL COMMONS   HOWELL   NJ
WRANGLEBORO SQUARE   MAY LANDING   NJ
WOODBRIDGE CROSSING   WOODBRIDGE   NJ
SOUTH VIRGINIA ST   RENO   NV
THE CROSSING   CLIFTON PARK   NY
NORTHWAY MALL   COLONIE   NY
WOODBURY TOWN CENTER   HARRIMAN   NY
MANHASSET CENTER   MANHASSET   NY
CORTLAND TOWN CENTER   MOHEGAN LAKE   NY
MIDWAY SHOPPING CENTER   SCARSDALE   NY
RIVERSIDE CENTER   UTICA   NY
BAINBRIDGE COMMONS   AURORA   OH
POLARIS TOWNE CENTER   COLUMBUS   OH
CUYAHOGA FALLS MARKETPLACE   CUYAHOGA   OH
TUTTLE CROSSING   DUBLIN   OH
 

SHOPPING CENTER

 

CITY

 

STATE

GOLDEN GATE PLAZA   MAYFIELD HEIGHTS   OH
CROSSROADS OF AMERICA   PERRYSBURG   OH
TANASBOURNE TOWN CENTER   BEAVERTON   OR
MILLCREEK PAVILLION   ERIE   PA
FORMER HECHINGERS   MONROEVILLE   PA
MARPLE CROSSROADS   SPRINGFIELD   PA
PITTSBURGH MILLS   TARENTUM   PA
LEHIGH VALLEY MALL   WHITEHALL   PA
MIDDLETOWN CENTER   MIDDLETOWN   RI
DORMAN CENTER   SPARTANBURG   SC
HICKORY HOLLOW MALL   ANTIOCH   TN
TECH RIDGE CROSSING   AUSTIN   TX
SUNRISE MALL   BROWNSVILLE   TX
PLAZA AT CEDAR HILL   CEDAR HILL   TX
BEST BUY PLAZA   DALLAS   TX
ALPHA PARKWAY   DALLAS   TX
WEST OAKS MALL   HOUSTON   TX
RIO NORTE CENTER   LAREDO   TX
THE MARKETPLACE AT TOWNE CENTER   MESQUITE   TX
PLANO   PLANO   TX
WICHITA FALLS   WICHITA FALLS   TX
MURRAY   MURRAY   UT
NEWPARK TOWN CENTER   PARK CITY   UT
POTOMAC MILLS SHOPPING CENTER   PRINCE WILLIAM   VA
TYSON'S CORNER   VIENNA   VA
GREENWAY STATION   MIDDLETON   WI
THE GRAND AVENUE MALL   MILWAUKEE   WI
REGENCY MALL   RACINE   WI

Contacts

MWW Group
Rich Tauberman / Susan Kenney
201-964-2408 / 201-964-2392
rtauberman@mww.com / skenney@mww.com

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