The purchase price that LDG paid as consideration for the Purchased Assets consists of the following: (i) $44,500,000.00 of debt forgiveness as evidenced by the credit bid of a portion of the Sellers’ obligations under the Amended and Restated Term Loan Agreement, dated as of April 20, 2007, by and among LI, D56 and LRI, as borrowers, the Company and other guarantors party thereto as guarantors, The Bank of New York Mellon, as administrative agent (as successor to UBS AG, Stamford Branch), and the lenders party thereto (the “Term Loan Agreement”), (ii) the assumption by LDG of certain assumed liabilities as specified in the LDG Asset Purchase Agreement (including certain cure costs), (iii) $18,221,083.39 in cash, equal to the amount of the outstanding obligations as of March 16, 2009, under the Debtor-in-Possession Revolving Credit Agreement, dated as of November 25, 2008, among D56, LRI, LI, the Company, UBS Securities LLC, JP Morgan Chase Bank, NA, UBS Loan Finance LLC, UBS AG, Stamford Branch and the lenders and other guarantors that are parties thereto, (iv) $6,654,268.35 in cash to JPMorgan chase Bank, N.A. to cash collateralize the Sellers’ letters of credit (v) $2,500,000.00 in cash to Sellers comprising (A) $2,150,000.00 to pay allowed administrative, priority and secured tax claims (excluding accrued but unpaid professional fees that were incurred by the Sellers or the Official Committee of Unsecured Creditors through March 16, 2009 that have been or subsequently will be approved by the United States Bankruptcy Court for the Southern District of New York (the “Accrued Professional Fees”)), (B) $250,000.00 to provide for distributions to the holders of allowed general unsecured claims against the Sellers, and (C) $100,000.00 to fund the costs and expenses of a plan administrator to wind down the Sellers’ estates from and after March 16, 2009, (vi) $7,664,679.88 in cash to pay the Accrued Professional Fees, (vii) $218,872.34 in cash to Fidelity Title Insurance Company to pay certain expenses, including real estate transfer taxes and mortgage recordation taxes payable in connection with the Sale, and (viii) $26,743.86 in cash to Sellers to pay certain transfer taxes in connection with the Sale. The purchase price was determined based on negotiations between the Sellers and LDG and its affiliates. LDG also agreed to offer employment to each of the Sellers’ employees who remained employed immediately prior to March 16, 2009, by Sellers or their subsidiaries. Those employees who accepted such offers of employment shall, for a period of 1 year following March 16, 2009, or such longer period as required by law, receive compensation and benefits that are, in the aggregate, substantially equivalent to those provided to such employees prior to March 16, 2009, provided that LDG shall not be required to provide equity-based benefits, defined benefit pension benefits, retiree medical or life insurance benefits, incentive or bonus plans or certain other benefits.

LDG is controlled by Clarion Capital Partners, LLC and certain other parties that are the lenders under the Term Loan Agreement (the “Term Loan Lenders”). The Term Loan Lenders and the Sellers also entered into the Plan Support Agreement, dated as of November 23, 2008, concerning the Term Loan Lenders’ commitment to the financial restructuring of Lenox’s indebtedness and other obligations (the “Plan Support Agreement”). With the exception of the foregoing, there is no material relationship between the Company and LDG other than in respect of the LDG Asset Purchase Agreement, as amended by the Amendment. A copy of the press release regarding the completion of the sale described above is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

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