07-14-2004, 05:10 PM
Posted 13/04/2004
Source Newsarama
The most recent development in the CrossGen bankruptcy, the companyâs landlord, 580 Industrial, Ltd, has petitioned the court for relief from the automatic stay placed on CGâs lease by the filing of Chapter 11, or, in the alternative, an order which would compel CrossGen to pay its post-petition lease obligations.
The filing is 580âs right, as a landlord, to seek relief from having a non-paying lessee which has filed Chapter 11, and is fairly common practice for a landlord with a lesee who has declared Chapter 11.
Under the law, CrossGen (the debtor in possession) has 60 days after filing (June 18th, 2004) to either assume the lease (pay what is owed, any damages incurred, as well as guarantee that further lease payments will be made in a timely fashion) or reject the lease (walk away from it and vacate the premises, allowing the leasing company to find new tenants). CrossGen can also ask the court for an extension on the decision.
After 60 days from the filing, the lease is assumed by the owner/leasing company to be rejected by the debtor in possession. That said, within the 60 day window, the debtor (CrossGen) is still obligated to perform its lease obligations, including paying rent. However, Chapter 11 has no remedy for a debtor who does not pay during that timeframe, forcing the landlord to appeal to the court for an order which will direct the debtor to pay what is owed, or vacate the premises.
According to the filing, CrossGen owes $5,653.41 for June (pro-rated from the date of filing), and $14,133.51 for July. 580 Industrial states that it wishes to relet the premises currently occupied by CrossGen, but cannot, as CrossGen is in possession of the building, and is currently within its 60 day window.
580 Industrialâs petition then, asks the judge to rule in its favor, granting one of three outcomes: 1) grant 580 relief from the stay and allow it to evict CrossGen and recover its property as is allowed under Florida state law (but currently barred due to the stay); 2) compel CrossGen to pay what it owes until it decides whether it will accept or reject the lease; or 3) if CrossGen is not able to pay what it owes, order the company to reject the lease immediately, and surrender possession of the leased properties.
Source Newsarama
The most recent development in the CrossGen bankruptcy, the companyâs landlord, 580 Industrial, Ltd, has petitioned the court for relief from the automatic stay placed on CGâs lease by the filing of Chapter 11, or, in the alternative, an order which would compel CrossGen to pay its post-petition lease obligations.
The filing is 580âs right, as a landlord, to seek relief from having a non-paying lessee which has filed Chapter 11, and is fairly common practice for a landlord with a lesee who has declared Chapter 11.
Under the law, CrossGen (the debtor in possession) has 60 days after filing (June 18th, 2004) to either assume the lease (pay what is owed, any damages incurred, as well as guarantee that further lease payments will be made in a timely fashion) or reject the lease (walk away from it and vacate the premises, allowing the leasing company to find new tenants). CrossGen can also ask the court for an extension on the decision.
After 60 days from the filing, the lease is assumed by the owner/leasing company to be rejected by the debtor in possession. That said, within the 60 day window, the debtor (CrossGen) is still obligated to perform its lease obligations, including paying rent. However, Chapter 11 has no remedy for a debtor who does not pay during that timeframe, forcing the landlord to appeal to the court for an order which will direct the debtor to pay what is owed, or vacate the premises.
According to the filing, CrossGen owes $5,653.41 for June (pro-rated from the date of filing), and $14,133.51 for July. 580 Industrial states that it wishes to relet the premises currently occupied by CrossGen, but cannot, as CrossGen is in possession of the building, and is currently within its 60 day window.
580 Industrialâs petition then, asks the judge to rule in its favor, granting one of three outcomes: 1) grant 580 relief from the stay and allow it to evict CrossGen and recover its property as is allowed under Florida state law (but currently barred due to the stay); 2) compel CrossGen to pay what it owes until it decides whether it will accept or reject the lease; or 3) if CrossGen is not able to pay what it owes, order the company to reject the lease immediately, and surrender possession of the leased properties.
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