Fair Lakes Crabhouse, Washingtonian Associates and Navillus Group (collectively, “Objecting Landlords”) filed with the U.S. Bankruptcy Court an objection to Ignite Restaurant Group’s sale motion.
The objection asserts, “Now that Landry’s has been deemed the Prevailing Bidder, it has proposed in its adequate assurance information to set up certain indirect wholly owned subsidiaries to assume assigned leases from the Debtors. Landry’s has not proposed to guarantee the assigned leases. Without such guarantee, the Landlords to the assigned leases will be left dealing with an ’empty shell’ of their own. Given the Debtors’ assessment of the general economic outlook in the casual dining industry and the lack of a guarantee, this is not adequate assurance of future performance by the assignee under 11 U.S.C. section 365(f)(2) and the factors laid out by the Fifth Circuit in In re Texas Health Enterprises. In addition to the objections raised in the Objecting Landlords’ objections to the Debtors’ Cure Notice, the Objecting Landlords object on these grounds. The Objecting Landlords hereby join in the objections filed by Debtors’ other landlords to the extent that such objections are not inconsistent with the provisions hereof.”
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