As reflected in the prior post, RGN Group Holdings, LLC, and various of its affiliates (“RGN” or the “Debtors”), which are subsidiaries of Regus, have filed for bankruptcy. As part of the first-day motions filed by the Debtors, RGN sought approval of proposed termination notification procedures, through its Motion to Approve Interim and Final Orders Establishing Notification Procedures for Lease Termination (the “Lease Termination Notification Motion”).
By way of update, the Court denied the Lease Termination Notification Motion on an interim basis, in light of several objections filed by landlords affected by the motion. Per the Court order, a hearing to determine whether to grant the Lease Termination Notification Motion on a final basis will be held on September 29, 2020, at 10:00 a.m. (prevailing Eastern Time), with objections due by no later than September 11, 2020, at 4:00 p.m. (prevailing Eastern Time).
In addition, the Debtors have recently sought to reject a lease to which RGN is a counter-party, through their Motion to Authorize (I) the Rejection of a Certain Unexpired Lease, (II) Authorizing the Abandonment of Certain Personal Property, and (III) Granting Related Relief (the “Rejection Motion”). Per the Rejection Motion, RGN seeks an order rejecting its lease with Merchandise Mart, L.L.C., in Chicago, Illinois.
Under Section 365 of the Bankruptcy Code, a debtor that is a tenant to a lease “may assume or reject” an unexpired lease. If the debtor rejects the lease, the landlord may assert a “rejection damage” claim against the debtor, which is generally afforded general unsecured priority.
Stay tuned for further updates in the RGN bankruptcy proceedings before the Delaware Bankruptcy Court.