Case nhl Doc 180 Filed 11/16/18 Entered 11/16/18 16:13:23

Transcription

1 ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK P.C. 875 Third Avenue, 9 th Floor New York, New York Telephone: (212) Facsimile: (212) Robert M. Sasloff, Esq. Attorneys for the C.E.G. Company UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF NEW YORK X In re: SEASONS CORPORATE LLC, et al., Chapter 11 Case No.: (NHL) (Jointly Administered) Debtors X OBJECTION OF THE C.E.G. COMPANY TO THE CURE NOTICE FOR THE LEASE OF THE PROPERTY LOCATED AT 661 AMSTERDAM AVENUE, NEW YORK, NEW YORK AND RESERVATION OF RIGHTS The C.E.G. Company ( C.E.G ), by and through their counsel, Robinson Brog Leinwand Greene Genovese & Gluck P.C., objects to the proposed assumption, assignment and cure amount related to the lease for the non-residential real property located at 661 Amsterdam Avenue, New York, New York (the Property ). I. BACKGROUND 1. On September 16, 2018 (the Petition Date ), the Debtors commenced these voluntary cases under Chapter 11 of the United States Bankruptcy Code. 2. On October 15, 2018, the Debtors filed their amended motion (the Procedures Motion ) 1 seeking to set bidding procedures and other relief with regard to a sale transaction 1 Doc. 109 { DOC;1 }969754

2 which contemplates the assumption and assignment of certain executory contracts and nonresidential real property leases, including the Lease (defined below). 3. On October 18, 2018, the Court entered an order (the Procedures Order ) 2 granting the Procedures Motion. The Procedures Order required that notices (the Cure Notice ) of the proposed amounts required to cure any breach of any executory contract and non-residential real property lease which the Debtors propose to assume and assign to be filed and served on the counter-parties. 4. C.E.G. and one of the Debtors, Upper West Side Supermarket LLC, are parties to a lease, by way of assignments, originally dated September 30, 2005, and as further modified, amended and assigned (the Lease ). 5. In 2007, C.E.G. had commenced an action against the Debtors predecessors in interest with regard to certain defaults, amongst others of which was a default regarding the HVAC and refrigeration/cooling system. A resolution was reached pursuant to a stipulation entered into by and between the parties, a copy of which is annexed hereto as Exhibit A. However, to date, this default has not been rectified. 6. On November 13, 2018, an amended cure notice was filed in these cases ( Amended Cure Notice ) The Amended Cure Notice provides for a $109, cure payment with respect to the Lease (see item 5 in the Amended Cure Notice). 8. The Amended Cure Notice does not, however, reference the prospective buyer s intent with regard to the non-bankruptcy default. 2 Doc Doc 159 { DOC;1 }969754

3 II. OBJECTION TO CURE 9. C.E.G. objects to the Amended Cure Notice as a substantial cure payment greater than asserted is required in order to cure the monetary defaults in the Lease. It appears that the amount listed in the Amended Cure Notice reflects what the proposed purchaser would like to pay, rather than what is actually due C.E.G. under the Lease 10. Pursuant to the Lease, the tenant was required to make timely payments for various items, including rent, real estate taxes, other charges and fees (the Lease Charges ). 11. The Debtors have not made all of the required payments for the Lease Charges. 12. Attached as Exhibit B is a schedule showing the outstanding and unpaid Lease Charges as of November 15, 2018 (the Cure Amount ). The Cure Amount is $282, plus unbilled legal fees of approximately $40, In addition, buyers must provide adequate assurance that they will be curing the non-monetary default regarding the HVAC and refrigeration/cooling system. C.E.G. estimates the cost of curing this default could be approximately $150, Pursuant to 11 U.S.C. 365(b)(1)(A), New Purchaser 4 must cure all defaults under the Lease, including the monetary defaults represented by the Cure Amount, in order to assume the Lease, and commit to correcting the non-monetary default. New Purchaser is not permitted to take assignment of the Lease without, inter alia, paying the Cure Amount and curing all other defaults. The Cure Amount will increase to reflect attorneys fees after that date, and if the Lease is not rejected, may also increase prior to any actual date of 4 As defined in the Amended Cure Notice. { DOC;1 }969754

4 assumption and assignment of the Lease if the Debtor does not timely pay all amounts that accrue thereunder. III. RESERVATION OF RIGHTS 15. C.E.G. reserves all rights and remedies including, but not limited to, objecting to the proposed assumption and assignment of the lease on all grounds including, inter alia, the requirement that all non-monetary defaults be cured, and the requirement that C.E.G. receive adequate assurance of future performance as required by applicable law. C.E.G. also holds various and assorted guaranties by third parties with regard to the Lease. The purported assumption and assignment of the Lease is without prejudice to C.E.G. s rights with respect thereto, and nothing contained herein shall be deemed as a release and/or waiver of C.E.G. s rights with respect to the guaranties. WHEREFORE, C.E.G. respectfully requests that the Court enter an appropriate Order providing that New Purchaser cannot assume or assign the Lease without complying with 11 U.S.C. 365 and other applicable law. Dated: November 15, 2018 New York, New York ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK P.C. Applicant and Attorneys for the Debtor 875 Third Avenue New York, New York Tel. No.: By: /S/Robert M. Sasloff Robert M. Sasloff { DOC;1 }969754

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24 Building 09R 175 W 92 ST/180 W 93 ST Arrears and Credit Balances 175 W 92 ST/180 W 93 ST Open Item Delinquency Report As Of November 2018 Page 1 Printed 11/15/2018 Menu ID DRNP ST-1 Apt No. Occupant UPPER WEST SIDE SUPERMARKET.LLC 11/01/18 10/01/18 09/01/18 09/01/18 09/01/18 08/01/18 08/01/18 07/01/18 07/01/18 07/01/18 07/01/18 07/01/18 06/01/18 06/01/18 06/01/18 05/01/18 04/01/18 01/01/18 12/01/17 11/01/17 10/01/17 10/01/17 04/01/17 01/01/17 Summary by Charge Code Charge Code Description Balance 002 COMM/PROF RENT 116, R/E TAX ESCAL 86, LATE CHARGES 24, LEGAL FEE REIM 16, RET CHECK FEE W/S ESC/REIMB 39, Total Arrears 282, Billing Period Chge Code Charge Description 77 LEGAL FEE REIM 2, LEGAL FEE REIM COMM/PROF RENT 35, LEGAL FEE REIM 10, W/S ESC/REIMB 4, LEGAL FEE REIM 1, COMM/PROF RENT 35, COMM/PROF RENT 35, LEGAL FEE REIM R/E TAX ESCAL 86, W/S ESC/REIMB LATE CHARGES 3, COMM/PROF RENT 8, LEGAL FEE REIM RET CHECK FEE LATE CHARGES 4, RET CHECK FEE LATE CHARGES 5, RET CHECK FEE LATE CHARGES 4, W/S ESC/REIMB 9, LATE CHARGES LATE CHARGES 5, W/S ESC/REIMB 24, Balance Due 282, Total Building Arrears 282, Balance