BarbriSFCourseDetails

Course Details

This CLE course will offer bankruptcy practitioners insight into key considerations and best practices concerning Bankruptcy Code Section 365's requirements for assuming and assigning retail leases, enhanced protections for certain landlords, curing defaults, establishing and providing adequate assurance of future performance including Section 365(l), current issues related to the tenant-debtor's post-petition rent and other obligations, negotiating lease amendments, and recent cases.

Faculty

Description

Under Bankruptcy Code Section 365 counterparties to leases or executory contracts that are be assumed, or assumed and assigned, are entitled to adequate assurance of performance--for example that debtors can cure defaults or that assignees of leases can perform their future obligations. Shopping center landlords are given special types of assurance. Section 365(l) allows lessors to require deposits or other security from the assignee as well.

What constitutes adequate assurance of performance and whether it has been provided are often litigated issues. A common pitfall is for a party to succeed on the issue of what would suffice as adequate protection, but then fail to produce any evidence it has been provided.

Assumption and assignment can occur on a tight time frame, offering landlords little time to identify potential assignees and conduct due diligence on them. Assumption and assignment create incentives and opportunities for landlords, assignees, and other interested parties to strengthen protections or obtain increased flexibility through amendments to the lease.

Listen as our experienced panel of bankruptcy counsel guides you through the bankruptcy rules for assumption and assignment of leases and discusses strategies for landlords and tenants to protect their rights and interests in their leases.

Outline

  1. Post-petition obligations under leases/contracts
  2. Debtor's business judgment under Section 365
  3. Assumption and cure of defaults: adequate assurance of future performance
  4. Assumption and assignment: adequate assurance of future performance
  5. Additional protections for shopping center leases
  6. Due diligence on prospective assignees
  7. Negotiation of lease amendments during a retail bankruptcy case
    1. Landlord interests
    2. Assignee/tenant interests
  8. Recent cases

Benefits

The panel will review these and other important issues:

  • What are best practices for conducting due diligence of prospective assignees?
  • How have courts interpreted Section 365(b)(3)(A)?
  • Is Section 365(l) underutilized and what are best practices for leveraging it?
  • How are post-assumption defaults dealt with?