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In re: KMART CORPORATION, et al., Chapter 11, Debtors.

AGREED ORDER BETWEEN KMART AND CAROLYN McDUFFIE

SUSAN SONDERBY, Chief Judge, Bankruptcy

This Agreed Order is entered into and submitted to the Court in accordance with the agreement of Kmart Corporation and certain of its subsidiaries, former debtors and debtors-in-possession in the above-captioned cases (collectively, "Kmart") and Carolyn McDuffie ("McDuffie" and, collectively with the "Parties"), in resolution of the motion of McDuffie for this Court to deem McDuffie's Claim Number 55993 as being timely filed (Docket No. 16070) (the "Motion"); it appearing to the Court that the relief should be granted,

IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT:

1. McDuffie's Administrative Expense Claim Request Form, filed with Trumbull Services, LLC on July 28, 2003 and assigned claim number 55993, (the "Claim") shall be deemed timely filed.

2. Except as provided in paragraph 1 of this order, Kmart expressly reserves all rights to challenge the validity, priority and amount of the Claim, and to pursue any other claims, causes of action or potential offsets against the Claim.

3. Kmart reserves all of its rights set forth in the Amended Order Approving the Procedures for (a) Liquidating and Settling Postpetition Personal Injury Claims through Direct Negotiation and/or Alternative Dispute Resolution and/or (b) Modifying the Plan Injunction to Permit Litigation with Respect to Such Claims to Proceed After Exhaustion of the Procedures (Docket No. 17525) (the "Administrative Personal Injury Procedures Order"). As set forth in the Administrative Personal Injury Procedures Order, McDuffie recognizes that Kmart has objected to all postpetition personal injury claims alleged to have been incurred between January 22, 2002, and May 6, 2003 (the "Administrative Personal Injury Claims").

4. Upon settlement of the Claim in accordance with the Procedures, or upon the issuance of a binding arbitration decision or final and non-appcalable judgment, the Parties forthwith shall satisfy and comply with the terms of such settlement or decision.

5. Nothing in this Agreed Order shall be deemed an admission of fact on the part of Kmart with respect to the Claim or any facts alleged in the Motion.

6. This Court shall retain jurisdiction to hear any matters or disputes arising from or relating to this Agreed Order.

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IN RE KMART CORPORATION
(May 3, 2004)