In its second turnabout within a week, Borders will close its Northeast distribution center in Carlisle, Pa., but keep the warehouse in LaVergne, Tenn., open for the foreseeable future, according to the Nashville Business Journal.

Borders had announced in January that it would close the Tennessee facility this summer; it cut 216 jobs there last year. Instead, both the Tennessee and California distribution centers will remain open, but a third facility in Carlisle will close by the end of the summer. Severance packages are being offered to the 333 affected employees.

While store closings continue to proceed apace accompanied by daily layoffs, the retailer is seeking the court’s help to hold on to 17 top executives. In papers filed yesterday, supported by declarations from Holly Felder Etlin, senior v-p of restructuring for Borders, and John Dempsey, a partner in Mercer, Borders asked to implement key employee incentive and retention plans. Possible payouts under the plans range from a total of $4.7 to $7.1 million, with Borders’s CEO Mike Edwards qualifying for incentives between $1.1 and $1.7 million based on meeting timetables for a plan of reorganization or a going concern sale. There will be no payouts if the company is liquidated. In its filing, Borders's lawyers noted that since filing for bankruptcy, about 25 corporate level employees in areas such as IT, finance, marketing and merchandising have "voluntarily" left the company, a rate that Borders called "alarming." "The Debtor cannot afford any more attrition," the motion seeking approval for the incentives states.

In addition, Borders is seeking $1.2 million in incentives to keep 25 store director-level employees plus a small number of other crucial employees.And in a line that reflects the massive turnover the company experienced even before the bankruptcy, Borders's noted that 70% of the 17 top employees have been with the retailer for less than 18 months.

Publishers are still waiting to see a new reorganization plan, but for some companies the plan could come too late. In a letter to Judge Glenn, David Beeman, founder of Cirqua, Customized Water, wrote, “As the owner of a small business that may not survive the income loss from Borders Filing, I ask you to review our plight and approve immediate payment of our billings.”

One vendor motion questions Borders’s commitment to selling e-readers as part of its future plans. SN Warranty, LLC, or Service Net, which provides extended service agreements (ESA) to customers who purchase Borders’s e-readers, is asking Borders to assume or reject their contract. By not remitting Service Net’s share of the ESA service fees pre- and post-petition e-reader customers have been “left in limbo,” according to the filing. “The activation of the ESAs attributable to these purchases is pending the Debtor’s transmittal of the required sales information and remittance of Service Net’s portion of the service fees.”

And depending on the April 7 hearing, some vendors may find themselves facing more returns. In another filing yesterday, Borders submitted a motion to return pre-petition merchandise for post-petition credit. In it, Borders notes that as their financial difficulties increased, vendors refused to accept trade credit or returns. The retailer, which pre-bankruptcy returned 31% of its merchandise annually for credit, has attempted to have publishers ship books under normal terms with limited success.