Critical to any assessment of a commercial landlord’s position when a tenant files bankruptcy is the collection of the “core bankruptcy information” . Please note that we have stressed “core” information. It is always possible that the facts and circumstances of a particular tenant bankruptcy will require that additional information be gathered. However, based on our experiences, the following information is needed with a high degree of consistency:

1. Name of Landlord

2. Name of Tenant

3. 1. and 2. above must match name of client and bankrupt entity; if not, this is a BIG FLAG that something may be fundamentally off. The discrepancy must be fully considered and explained.

4. Effective date of bankruptcy (in most cases, the date on which the bankrupt tenant filed its petition in bankruptcy), and date the lease expired or was terminated or is set to expire.

5. Did either of the following occur prior to the date of bankruptcy and if so when:

a. Landlord repossessed the leased premises (date); or

b. Tenant surrendered the leased premises to Landlord (date)

6. Total payment(s) due/overdue on date of bankruptcy (prorate if effective date of bankruptcy did not fall on a due date per the lease).

7. Amount of rent reserved under the lease (without acceleration but including all pass-throughs or estimated future pass-throughs) for the period beginning on the earlier of the dates in 4 or 5 above and ending on:

a. One year thereafter; or

b. 15% of the remaining term (not to exceed three years)

For above computation, prorate the rent if beginning and/or ending dates do not fall on a due date per the lease.

8. Were any goods sold by Landlord to Tenant during the twenty days prior to the date of bankruptcy as part of the ordinary course of Tenant’s business and if so what was the value of the goods received by Tenant?

9. How do the terms of the lease compare with the terms the landlord could likely obtain for the leased premises in the current market? This question, of course, is both the starting point and continuing litmus test to be applied to landlord’s response if the bankrupt tenant commences any negotiations about any proposal other than the results obtained if the lease is rejected (on the one hand) or assumed (or assumed and assigned) (on the other hand)?