SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Fiscal year ended December 31, 1997
Commission File Number 333-55803
Full title of the plan and the address of the plan, if different
from that of the issuer named below:
Deferred Compensation Plan of Linens 'n Things, Inc.
Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
LINENS 'N THINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware 22-3463939
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
6 Brighton Road, Clifton, New Jersey 07015
(Address of principal executive offices) (Zip Code)
(973) 778-1300
(Registrant's telephone number, including area code)
DEFERRED COMPENSATION PLAN OF LINENS 'N THINGS, INC.
Financial Statements
As of December 31, 1997 and for
the Year Ended December 31, 1997
With Independent Auditors' Report Thereon
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DEFERRED COMPENSATION PLAN OF
LINENS 'N THINGS, INC.
Index
Page No.
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Independent Auditors' Report 3
Statement of Net Assets Available for Plan
Benefits - December 31, 1997 4
Statement of Changes in Net Assets Available for
Plan Benefits - Year Ended December 31, 1997 4
Notes to Financial Statements 5-6
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Independent Auditors' Report
Compensation Committee
Linens 'n Things, Inc.
Deferred Compensation Plan of
Linens 'n Things, Inc.:
We have audited the accompanying statement of net assets available for Plan
benefits of the Deferred Compensation Plan of Linens 'n Things, Inc. (the
"Plan") as of December 31, 1997 and the related statement of changes in net
assets available for Plan benefits for the year then ended. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 1997, and the changes in net assets available for Plan benefits for
the year then ended in conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
New York, New York
June 26, 1998
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Linens 'n Things, Inc.
Deferred Compensation Plan
Statement of Net Assets Available for Plan Benefits
December 31, 1997
-------------------
ASSETS:
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Linens 'n Things, Inc. Common Stock Fund $1,449,397
Scudder Value Fund 1,032,128
Strong Government Securities Fund 70,124
T. Rowe Price Blue Chip Growth Fund 1,232,554
Neuberger & Berman Genesis Fund 1,022,229
Warburg Pincus Emerging Growth Fund 413,454
-------------------
Net assets available for plan benefits $5,219,886
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The accompanying notes are an integral part of these financial statements.
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Linens 'n Things, Inc.
Deferred Compensation Plan
Statement of Changes in Net Assets Available for Plan Benefits
December 31, 1997
-----------------
ADDITIONS:
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Investment income:
Dividend income $52,575
Net appreciation in fair value of investments 1,088,264
------------
Net investment income 1,140,839
Employee contributions 4,079,047
------------
Net increase, representing net assets available for
plan benefits at end of the year $5,219,886
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The accompanying notes are an integral part of these financial statements.
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DEFERRED COMPENSATION PLAN OF
LINENS 'N THINGS, INC.
Notes to Financial Statements
December 31, 1997
1. Description of the Plan
The following brief description of the Deferred Compensation Plan of
Linens 'n Things, Inc. (the "Plan") is provided for general information purposes
only. Participants should refer to the Plan document for more complete
information.
General
The Plan is sponsored by Linens 'n Things, Inc., (the "Company"). The
Plan was established to enable key employees of the Company to defer
compensation, including stock and stock denominated awards, for personal income
tax purposes. The non-qualified Plan was adopted on December 30, 1996 and is
treated as a plan maintained for a select group of management as highly
compensated individuals under the Employee Retirement Income Security Act of
1974 ("ERISA"). The Plan is not taxable as a separate entity under the Internal
Revenue Code.
Eligibility and Vesting
The Plan covers key employees, as designated by the Company.
Participation is voluntary and participants can elect to make contributions to
the Plan. Participants are 100% vested in their own deferrals to the Plan at all
times.
Participant Accounts
An account is maintained for each participant in the Plan which shows
the participant's separate interest in each investment fund of the Plan. Each
participant shall elect the allocation of contributions to specific funds within
the Plan. The participant's account shall be credited, as of the end of each
month, with the amount of deferred compensation contributed and, the appropriate
investment income of each fund.
Participants are eligible for distribution of their benefits in cash or
Company common stock upon retirement, death, termination of service, in the
event of a designated change of control of the Company and in the event of
immediate unexpected financial needs of the participant, as the Plan is not
subject to the hardship rules of Section 401 of the Internal Revenue Code. In
the event of a change of control, payments in settlement of a participants
account shall be made within fifteen business days following such change in
control.
Grantor Trust
The Company established a Grantor (Rabbi) Trust (the "Trust"). The
Trust shall be governed by and subject to the terms of a trust agreement entered
into between the Company, as grantor, and the trustee, Bank of New York.
2. Summary of Significant Accounting Policies
a) Basis of Presentation
The accompanying financial statements of the Plan have been
prepared on the accrual basis of accounting.
b) Investments
The Plan's investments consist of mutual funds, a money market
fund and a Company common stock fund. The Plan's investments are presented at
their fair market values.
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DEFERRED COMPENSATION PLAN OF
LINENS 'N THINGS, INC.
Notes to Financial Statements, continued
December 31, 1997
3. Plan Termination
Although the Company has not expressed any intent to terminate the
Plan, it may do so at any time. In the event the Plan is terminated, all sums
credited to individual accounts would be distributed to participants.
4. Administrative Expenses
All administrative costs of the Plan are borne by the Company.
5. Use of Estimates and Concentration of Risks
In preparing the Plan's financial statements, management has made a
number of estimates and assumptions relating to the reporting of assets and
liabilities and the disclosure of contingent assets and liabilities to present
these financial statements in conformity with generally accepted accounting
principles. Actual results could differ from those estimates.
The assets of the Plan are primarily financial instruments which are
monetary in nature. As a result, interest rates have a more significant impact
on the Plan's performance than the effects of general levels of inflation.
Interest rates do not necessarily move in the same direction or in the same
magnitude as the prices of goods and services as measured by the consumer price
index. Investments are subject to risk conditions of the individual fund
objectives, the stock market, interest rates, economic conditions and world
affairs.
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Pursuant to the requirements of the Securities and Exchange Act of 1934, the
members of the Deferred Compensation Committee (which is the administrative
committee for the Compensation Committee of the Board of Directors of the
Company) have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
Deferred Compensation Plan of
Linens 'n Things, Inc.
Dated June 26, 1998
STANLEY P. GOLDSTEIN
By:______________________________________
Stanley P. Goldstein
Chairman of the Compensation Committee
of the Board of Directors
Consent of Independent Auditors'
Compensation Committee
Linens 'n Things, Inc.
Deferred Compensation Plan of
Linens 'n Things, Inc.:
We consent to incorporation by reference in the Registration Statements Numbers
333-26819, 333-26827 and 333-55803 on Form S-8 of our report dated June 26, 1998
relating to the statement of net assets available for Plan benefits of the
Deferred Compensation Plan of Linens 'n Things, Inc. as of December 31, 1997 and
the related statement of changes in net assets available for Plan benefits for
the year then ended, which report appears in the December 31, 1997 Annual Report
of the Deferred Compensation Plan of Linens 'n Things, Inc. on Form 11-K.
KPMG PEAT MARWICK LLP
New York, New York
June 29, 1998
