Linens 'n Things plan of liquidation confirmed by bankruptcy court

By Jennifer Lanning Drey

Portland, Ore., June 15 - Linens Holding Co. obtained court approval of its plan of liquidation, according to a Monday filing with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, Linens has decided to liquidate its assets and wind down its operations.

Senior noteholders will be paid in full through a senior noteholder distribution, and general unsecured creditors will be paid in full from an unsecured creditor liquidating trust.

Linens previously said its debtor-in-possession facility has been repaid using proceeds from store-closing sales.

Creditor treatment

Treatment of creditors under the company's liquidation plan will include:

• Holders of administrative claims, priority tax claims and other priority claims will be paid in full in cash;

• Holders of other secured claims will receive either cash or the collateral securing the claim;

• Holders of senior note claims will be paid in full through a share of the senior noteholder distribution;

• Holders of unsecured claims will be paid in full from the unsecured creditor liquidating trust; and

• Holders of equity interests and intercompany claims will receive no distribution under the plan.

Linens 'n Things, a Clifton, N.J., home furnishings specialty retailer, filed for bankruptcy on May 2, 2008. Its Chapter 11 case number is 08-10832.

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