In re Service Merchandise Company, Inc.

Full title: In re: SERVICE MERCHANDISE COMPANY, INC., et al., Chapter 11 Reorganized…

Court: United States Bankruptcy Court, M.D. Tennessee, Nashville Division

Date published: Sep 9, 2004

Case No. 399-02649 Jointly Administered (Bankr. M.D. Tenn. Sep. 9, 2004)

Opinion

Case No. 399-02649 Jointly Administered.

September 9, 2004

Paul G. Jennings, Phillip G. Young, BASS, BERRY SIMS PLC, Nashville, TN, and John Wm. Butler, Jr., George N. Panagakis, SKADDEN, ARPS, SLATE, MEAGHER FLOM (ILLINOIS).

AGREED ORDER RESOLVING OBJECTION OF WEINGARTEN NOSTAT, INC. TO THE LEASE NOTICE DATED MAY 7, 2003 AND THE PROPOSED ASSIGNMENT OF LEASE TO SM NEWCO LAS VEGAS, LLC

GEORGE PAINE, Chief Judge, Bankruptcy

This matter having come before the Court on that certain objection (the "Objection") of Weingarten Nostat, Inc. (the "Landlord") to the Lease Notice dated May 7, 2003 and Proposed Assignment of that certain lease dated August 23, 1989 (as amended, modified, or supplemented, the "Lease"), covering that certain property located at 4701 Faircenter Parkway, Las Vegas, NV 89102, as more particularly described in the Lease (the "Leased Premises"), to SM Newco Las Vegas, LLC ("Newco"); and the parties having agreed, as signified by the signatures of counsel below, to a resolution of the issues raised in the Objection; and the Court being satisfied that the relief herein is appropriate under the circumstances; and the Court being otherwise sufficiently advised,

IT IS HEREBY ORDERED THAT:

1. The Objection is hereby withdrawn.

2. Service Merchandise Company, Inc. and certain of its subsidiaries and affiliates, debtors under title 11 of the United States Code (collectively, the "Reorganized Debtors") and KLA/SM, LLC ("KLA") acknowledge that the Landlord and Service Merchandise Company, Inc. entered that certain First Amendment to Lease dated November 11, 2000 (the "First Amendment"), which was approved by order of this Court entered December 1, 2000 (the "December 2000 Order"), and further that on December 30, 2001, Service Merchandise Company, Inc., the Landlord, and Bed, Bath Beyond entered a recognition agreement (the "Recognition Agreement"). The Reorganized Debtors and KLA acknowledge the continuing effectiveness of the First Amendment, the December 2000 Order, and the Recognition Agreement.

3. The Landlord, the Reorganized Debtors, and KLA acknowledge and agree that, notwithstanding the terms proposed in the Lease Notice, (i) DDR shall not deliver a Guaranty to Newco and (ii) the Lease shall be assigned to Newco with a simultaneous sublease of the entire Leased Premises to Michaels Stores, Inc. ("Michaels").