| |
February 13, 2004
Contact:
Kmart Media Relations
(248) 463-1021
For Immediate Release
KMART HOLDING CORPORATION CONFIRMS FILING OF LAWSUIT
TROY, MICHIGAN, February 13, 2004 -- Kmart Holding Corporation (Nasdaq: KMRT) today confirmed that it filed an action against Martha Stewart Living Omnimedia ("MSO") with the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division on February 11, 2004. Kmart is seeking declaratory and other relief under the June 2001 contract, as assumed, between Kmart and MSO IP Holdings, Inc. ("MSO IP"), a wholly owned subsidiary of MSO.
Kmart believes that MSO's news release distributed earlier today does not accurately reflect Kmart's position as set forth in the complaint. In particular, Kmart is not, at this time, seeking to reduce the total guarantees or the required advertising levels, but rather it is MSO which is seeking to force Kmart to make payments in excess of the contractual requirement, which payments would represent an impermissible double-counting. MSO's interpretation is inconsistent with the basis on which the contract was assumed in bankruptcy. Further, Kmart is seeking to clarify the amount that Kmart is required to spend on MSO media properties consistent with the plain language of the document and the referenced actual spend in 2001.
Kmart has repeatedly but unsuccessfully attempted to resolve this issue through negotiation since last fall. Kmart was left with no choice, in light of its need to plan its business and the fact that the next royalty payment under the contract is due on February 28, but to commence the action. Kmart continues to value its relationship with MSO and sincerely hopes for a prompt conclusion to this matter.
About Kmart Holding Corporation
Kmart Holding Corporation (NASDAQ: KMRT) and its subsidiaries (together,"Kmart") is a mass merchandising company that offers customers quality products through a portfolio of exclusive brands that include THALIA SODI, DISNEY, JACLYN SMITH, JOE BOXER, KATHY IRELAND, MARTHA STEWART EVERYDAY, ROUTE 66 and SESAME STREET. Kmart operates more than 1,500 stores in 49 states and is one of the 10 largest employers in the country with approximately 158,000 associates. For more information visit the Company’s website at www.kmart.com.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION AND OTHER MATTERS
Statements made by Kmart which address activities results, events or developments that we expect or anticipate may occur in the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect Kmart's current views with respect to current events and projected financial performance. Such forward-looking statements are based upon assumptions concerning future conditions that may ultimately prove to be inaccurate and involve risks, uncertainties and factors that could cause actual results to differ materially from any anticipated future results or prospects, express or implied, by such forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, factors relating to Kmart's internal operations and the external environment in which it operates; marketplace demand for the products of Kmart's key brand partners as well as the engagement of appropriate new brand partners; increasing competition from other retailers; Kmart's ability to operate pursuant to its credit facility; outcome of negotiations on collective bargaining agreements and other labor issues with unions representing employees in our distribution centers; Kmart's ability to obtain and maintain normal terms with its vendors, attract and retain customers, obtain and maintain appropriate inventory, implement its business plan and strategies, attract, motivate and/or retain key executives and associates; and other risks detailed in Kmart's Securities and Exchange Commission filings. Kmart undertakes no obligation to release publicly the results of any revisions to these forward-looking statements to reflect events or circumstances after the date such statements were made.
|
