Retail and Restaurant Bankruptcies: Key Issues for Debtors, Landlords and Vendors

Assumption and Rejection of Leases, Franchise Agreements, Gift Cards, Consignment Rights, and Going-Out-of-Business Sales

Recording of a 90-minute premium CLE webinar with Q&A

Conducted on Tuesday, February 19, 2019

Recorded event now available

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Program Materials

This CLE webinar will provide counsel with the tools to address the specific issues that arise during retail and restaurant bankruptcies. The panel will provide guidance on topics related to leases and other executory contracts, franchise agreements, vendor rights, gift cards, and the many other issues specific to retail and restaurant insolvencies.


Retailers and restaurants are filing for bankruptcy protection at an alarming rate, primarily because of changing consumer preferences away from brick-and-mortar establishments and toward online shopping and food delivery services. Counsel for retailers must carefully consider the issues clients face before filing for bankruptcy. For instance, retailers have only 210 days to decide which leases to accept or reject, and lenders often require retail debtors to propose a reorganization plan within 90 to 120 days after filing or face liquidation of the business.

Further, retailers must decide whether to continue to honor gift cards, loyalty program points, and other customer incentives post-petition. Similarly, the going-out-of-business sale is an oft-used mechanism but subject to many restrictions and conditions. Retailers must also factor in consignment arrangements where a vendor has delivered goods but retains title pending sale to a third party. Also, vendors often assert that their claims have priority under Section 503(b)(9) of the Bankruptcy Code.

Similarly, restaurants face an array of related issues when filing for bankruptcy. Large restaurant chains often seek to reject unprofitable leases under Section 365(a), while other restaurant owners aim to keep existing leases post-petition by requesting an extension for performance for up to 60 days under Section 365(d)(3).

Whether the debtor is a franchisee or franchisor, bankruptcy affords many options to resolve franchise agreement assignment and intellectual property issues. In this context, savvy counsel must carefully advise clients on clearly presenting information about assets, liabilities and other financial affairs while strategically negotiating with significant stakeholders.

Listen as our authoritative panel discusses how to best guide retail or restaurant clients through a bankruptcy proceeding, all while deploying every available tool to maximize the value of inventory and assets, protect the client's equity, and preserve long-term customer goodwill.



  1. The upswing in retail and restaurant bankruptcies
  2. Assumption and rejection of leases--treatment of rent pre- and post-petition
  3. Customer incentives post-petition--gift cards and loyalty programs
  4. Vendors--consignment, stay relief and other issues
  5. Inventory--going out of business sales
  6. Future trends and miscellaneous issues


The panel will review these and other key issues:

  • What is the procedure and timing for assuming or rejecting leases in bankruptcy?
  • What steps may vendors take to protect their rights to consigned goods?
  • What are some of the constraints on going-out-of-business sales and how are they resolved in bankruptcy?


Pomerantz, Jeffrey
Jeffrey N. Pomerantz

Co-Chair, Creditors' Committee Practice
Pachulski Stang Ziehl & Jones

Mr. Pomerantz sits on the Executive Committee of the American Bankruptcy Institute, the largest restructuring...  |  Read More

Trache, Dylan
Dylan Trache

Nelson Mullins Riley & Scarborough

Mr. Trache focuses his practice in bankruptcy and financial restructuring. He has experience representing Chapter 11...  |  Read More

Stratton, Teri
Teri Stratton

Managing Director, Restructuring and Special Situations
Piper Sandler

Ms. Stratton has significant experience providing debt advisory, equity private placements, capital markets, mergers...  |  Read More

Tibus, Jonathan
Jonathan Tibus

Managing Director
Alvarez & Marsal

Mr. Tibus specializes in developing, evaluating, and implementing performance improvement and restructuring plans for...  |  Read More

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