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EXHIBIT 10.1
LICENSE AGREEMENT
This
License Agreement (the "License") is made and entered into this
30th
day of August, 2002 (the "Effective Date"),
by and between VALUE CITY DEPARTMENT
STORES, INC., an Ohio corporation, whose
address is 1800 Moler Road, Columbus,
Ohio 43207 ("VCDS"), and SHONAC
CORPORATION, an Ohio corporation, whose address
is 4150 East Fifth Avenue, Columbus, Ohio
43219 ("Shonac").
RECITALS
A.
Crossings at Hobart - I LLC, an Ohio limited liability company
("Master
Landlord") is the fee owner of certain real
property located in the City of
Merrillville, State of Indiana, legally
described on Exhibit "A" hereto (the
"Shopping Center Parcel");
B. Master
Landlord is the lessor under that certain Lease ("Master
Lease")
dated as of May 18th, 1994, between Master
Landlord and Service Merchandise
Company, Inc. (the "Service Merchandise")
for 50,000 square feet of premises in
the Shopping Center Parcel, as depicted in
Exhibit "B" attached hereto and made
a part hereof ("premises"), which premises
is part of the Shopping Center
Parcel;
C. Service
Merchandise filed a voluntary petition for relief under Chapter
11 of the Bankruptcy Code on March 27,
1999. Pursuant to that certain order by
the United States Bankruptcy Court for TN,
Service Merchandise and Jubilee
Limited Partnership, an Ohio limited
partnership ("Landlord") entered into a
certain Assignment and Assumption Agreement
dated July 2, 2002 (the
"Assignment") in which Service Merchandise
assigned to Landlord and Landlord
assumed from Service Merchandise all of
Service Merchandise's right, title and
interest as tenant under the Master
Lease;
D.
Landlord and VCDS entered into that certain Lease ("Lease")
dated
August 30th, 2002, demising to VCDS the
premises. The Lease is attached hereto
and made a part hereof as Exhibit "C" ;
and
E. VCDS
desires to license to Shonac and Shonac desires to license from
VCDS certain rights, title and interest of
VCDS under the Lease with respect to
the premises, as provided herein.
AGREEMENTS
In
consideration of the premises and other good and valuable
consideration, VCDS and Shonac agree as
follows:
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ARTICLE I
PRELIMINARY MATTERS
1.1
Defined Terms.
Any defined terms used herein shall have the same
meaning as set forth in the Lease.
1.2
Representations
and Warranties. VCDS represents and warrants to
Shonac that:
(a)
To the best of VCDS's knowledge, neither Landlord nor VCDS are
in default under the Lease;
(b)
To the best of VCDS's knowledge, neither Master Landlord nor
Landlord are in default under the Master Lease;
(c)
VCDS has full right, power and authority to make this License;
(d)
To the best of VCDS's knowledge, there is no litigation pending
in connection with the Master Lease, the Lease, or the
premises;
(e)
To the best of VCDS's knowledge, the documents heretofore
provided by VCDS to Shonac represent all agreements related to
the Master Lease and Lease
ARTICLE II
LICENSE
2.1
License and Term. VCDS hereby licenses to Shonac all of VCDS's
rights
and obligations under the Lease, and Shonac
hereby accepts such license and
assumes such rights and obligations. The
term of this License shall commence on
the Effective Date and shall expire on the
day preceding the end of the term of
the Lease, as the same may be extended,
unless sooner terminated in accordance
with the terms set forth herein. In the
event VCDS receives notice from Shonac
of its election to extend the term of the
License at least seven (7) months
prior to the expiration of the then current
term and any Lease renewal options
remain, VCDS agrees to timely exercise its
right to extend the term of the
Lease. VCDS agrees to deliver the premises
to Shonac immediately following
receipt thereof from Landlord.
2.2 Lease.
Shonac agrees to comply with all terms, provisions, and
conditions of VCD Sunder the Lease. VCDS
agrees to immediately deliver to Shonac
any notices it receives from Landlord
regarding the Lease and/or this License.
If Shonac fails to perform any of the
provisions of the Lease, then, so long as
VCDS is liable for performance of
obligations under the Lease, VCDS may exercise
the rights and remedies available to
Landlord under the Lease, provided that
VCDS has afforded Shonac the same notice
and opportunity to cure, if any,
afforded to VCDS under the Lease.
Notwithstanding the foregoing, the parties
agree that the time period for such cure
shall be five (5) days less than the
time period set forth in the Lease with
respect to monetary obligations and ten
(10) days less than the time period set
forth in the Lease with respect to
non-monetary
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obligations. VCDS shall not be entitled to
recover from Shonac any amounts
Shonac has paid to Landlord on account of
VCDS's obligations under the Lease.
VCDS
agrees to enforce all of the obligations of Landlord under the
Lease.
If VCDS fails to enforce any of the
Landlord's obligations under the Lease, then
Shonac shall have the same rights and
remedies available to VCDS under the
Lease, provided that Shonac has afforded to
VCDS the same notice and opportunity
to cure, if any, afforded to Landlord under
the Lease. Shonac agrees to
immediately deliver to VCDS any notices it
may receive from Landlord regarding
the premises and/or this License.
2.3 Rent.
During the Term of this License, Shonac shall have the right to
pay all rental amounts due and payable
under the Lease directly to Landlord.
VCDS agrees to deliver to Shonac, within
five (5) days following receipt
thereof, any amounts paid to VCDS under the
Lease by Landlord, including without
limitation, the Tenant Reimbursement set
forth in Section 50 of the Lease.
2.4
Assignment of Warranties and Guaranties. During the te
