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In October 1988, the Company completed the sale of its former
Zayre Stores division to Ames Department Stores, Inc. ("Ames").
In April 1990, Ames filed for protection under Chapter 11 of the
Federal Bankruptcy Code and in December 1992, Ames emerged from
bankruptcy under a plan of reorganization.
The Company remains contingently liable for the leases of most
of the former Zayre stores still operated by Ames. In addition,
the Company is contingently liable on a number of leases of the
Hit or Miss division, the Company's former off-price women's specialty
stores, sold on September 30, 1995. The Company believes that
the Company's contingent liability on these leases will not have
a material effect on the Company's financial condition.
The Company is also contingently liable on certain leases of
its former warehouse club operations (BJ's Wholesale Club and
HomeBase), which was spun off by the Company in fiscal 1990 as
Waban Inc. During fiscal 1998, Waban Inc. was renamed HomeBase,
Inc. and spun-off from its BJ's Wholesale Club division (BJ's
Wholesale Club, Inc.). HomeBase, Inc., and BJ's Wholesale Club,
Inc. are primarily liable on their respective leases and have
indemnified the Company for any amounts the Company may have to
pay with respect to such leases. In addition HomeBase, Inc., BJ's
Wholesale Club, Inc. and the Company have entered into agreements
under which BJ's Wholesale Club, Inc. has substantial indemnification
responsibility with respect to such HomeBase, Inc. leases. The
Company is also contingently liable on certain leases of BJ's
Wholesale Club, Inc. for which both BJ's Wholesale Club, Inc.
and HomeBase, Inc. remain liable. The Company believes that its
contingent liability on the HomeBase, Inc. and BJ's Wholesale
Club, Inc. leases will not have a material effect on the Company's
financial condition.
L. S e g m e n t I n f o r m a t i o n
For data on business segments for fiscal 1998, 1997 and 1996, see page 20.
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