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Full title: Objection to (related document(s): 364 Notice (generic) filed by Debtor Studio Movie Grill Holdings, LLC) filed by Creditor Reserve Capital - Hidden Grove SPE, LLC. (Attachments: # 1 Exhibit) (Marshall, Joe)

Document posted on Jan 12, 2021 in the bankruptcy, 4 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

DALLAS DIVISION IN RE: § Chapter 11 § Studio Movie Grill Holdings, LLC, et al1 § Case No. 20-32633-SGJ-11 § Debtors.G.C. JERNIGAN, U.S. BANKRUPTCY JUDGE: Reserve Capital – Hidden Grove SPE, LLC ("Reserve Capital"), a creditor and party-in-interest herein, files this Limited Objection to Assumption and Assignment of Nonresidential Real Property Lease with Reserve Capital ("Objection") and in support thereof would respectfully state the following: 1. On October 23, 2020 (“Petition Date”), Studio Movie Grill The Debtors in these Chapter 11 cases include: Studio Movie Grill Holdings, LLC (6546) (“SMG Holdings”); OHAM Holdings, LLC (0966); Movie Grill Concepts Trademark Holdings, LLC (3096); Movie Grill Concepts I, Ltd. (6645); Movie Grill Concepts III, Ltd. (2793); Movie Grill Concepts IV, Ltd. (1454); Movie Grill Concepts IX, LLC (3736); Movie Grill Concepts VI, Ltd. (6895); Movie Grill Concepts VII, LLC (2291); Movie Grill Concepts X, LLC (6906); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XII, LLC (6040); Movie Grill Concepts XIII, LLC (5299); Movie Grill Concepts XIV, LLC (4709); Movie Grill Concepts XIX, LLC (9646); Movie Grill Concepts XL, LLC (4454); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLII, LLC (2309); Movie Grill Concepts XLIII, LLC (9721); Movie Grill Concepts XLIV, LLC (8783); Movie Grill Concepts XLV, LLC (2570); Movie Grill Concepts XV, LLC (4939); Movie Grill Concepts XVI, LLC (1033); Movie Grill Concepts XVII, LLC (1733); Movie Grill Concepts XVIII, LLC (8322); Movie Grill Concepts XX, LLC (7300); Movie Grill Concepts XXI, LLC (1508); Movie Grill Concepts XXII, LLC (6748); Movie Grill Concepts XXIV, LLC (5114); Movie Grill Concepts XXIX, LLC (5857); Movie Grill Concepts XXV, LLC (4985); Movie Grill Concepts XXVI, LLC (5233); Movie Grill Concepts XXVII, LLC (4427); Movie Grill Concepts XXVIII, LLC (1554); Movie Grill Concepts XXX, LLC (1431); Movie Grill Concepts XXXI, LLC (3223); Movie Grill Concepts XXXII, LLC (0196); Movie Grill Concepts XXXIII, LLC (1505); Movie Grill Concepts XXXIV, LLC (9770); Movie Grill Concepts XXXIX, LLC (3605); Movie Grill Concepts XXXV, LLC (0571); Movie Grill Concepts XXXVI, LLC (6927); Movie Grill Concepts XXXVII, LLC (6401); Movie Grill Concepts XXXVIII, LLC (9657); Movie Grill Concepts XXIII, LLC (7893); Studio Club, LLC (3023); Studio Club IV, LLC (9440); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLVI, LLC (2344); Movie Grill Concepts XLVII, LLC (5866); Movie Grill Concepts XLVIII, LLC (8601); Movie Grill Concepts XLIX, LLC (0537); Movie Grill Concepts L, LLC (5940); Movie Grill Concepts LI, LLC (7754); Movie Grill Concepts LII, LLC (8624); Movie the above-referenced bankruptcy case ("Bankruptcy Case").The Lease is evidenced by that certain Office Lease Agreement dated July 1, 2016 originally executed by SMG Holdings and Reserve Capital's predecessor-in-inter

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Texas Bar No. 13031100 MARSHALL LAW 3131 McKinney Ave., Suite 600 Dallas, Texas 75204 Telephone: (214) 579-5179 E-mail: jmarshall@MarshallLaw.net ATTORNEY FOR RESERVE CAPITAL – HIDDEN GROVE SPE, LLC IN THE UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF TEXAS DALLAS DIVISION IN RE: § Chapter 11 § Studio Movie Grill Holdings, LLC, et al1 § Case No. 20-32633-SGJ-11 § Debtors. § (Jointly Administered) LIMITED OBJECTION TO ASSUMPTION AND ASSIGNMENT OF NONRESIDENTIAL REAL PROPERTY LEASE WITH RESERVE CAPITAL – HIDDEN GROVE SPE, LLC TO THE HONORABLE STACEY G.C. JERNIGAN, U.S. BANKRUPTCY JUDGE: Reserve Capital – Hidden Grove SPE, LLC ("Reserve Capital"), a creditor and party-in-interest herein, files this Limited Objection to Assumption and Assignment of Nonresidential Real Property Lease with Reserve Capital ("Objection") and in support thereof would respectfully state the following: 1. On October 23, 2020 (“Petition Date”), Studio Movie Grill Holdings, LLC ("SMG Holdings") and various related entities (collectively, the “Debtors”) filed a voluntary petition for relief under Chapter 11 of Title 11 of the United States Bankruptcy Code ("Bankruptcy Code"), thereby initiating the ________________________________________ 1 The Debtors in these Chapter 11 cases include: Studio Movie Grill Holdings, LLC (6546) (“SMG Holdings”); OHAM Holdings, LLC (0966); Movie Grill Concepts Trademark Holdings, LLC (3096); Movie Grill Concepts I, Ltd. (6645); Movie Grill Concepts III, Ltd. (2793); Movie Grill Concepts IV, Ltd. (1454); Movie Grill Concepts IX, LLC (3736); Movie Grill Concepts VI, Ltd. (6895); Movie Grill Concepts VII, LLC (2291); Movie Grill Concepts X, LLC (6906); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XII, LLC (6040); Movie Grill Concepts XIII, LLC (5299); Movie Grill Concepts XIV, LLC (4709); Movie Grill Concepts XIX, LLC (9646); Movie Grill Concepts XL, LLC (4454); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLII, LLC (2309); Movie Grill Concepts XLIII, LLC (9721); Movie Grill Concepts XLIV, LLC (8783); Movie Grill Concepts XLV, LLC (2570); Movie Grill Concepts XV, LLC (4939); Movie Grill Concepts XVI, LLC (1033); Movie Grill Concepts XVII, LLC (1733); Movie Grill Concepts XVIII, LLC (8322); Movie Grill Concepts XX, LLC (7300); Movie Grill Concepts XXI, LLC (1508); Movie Grill Concepts XXII, LLC (6748); Movie Grill Concepts XXIV, LLC (5114); Movie Grill Concepts XXIX, LLC (5857); Movie Grill Concepts XXV, LLC (4985); Movie Grill Concepts XXVI, LLC (5233); Movie Grill Concepts XXVII, LLC (4427); Movie Grill Concepts XXVIII, LLC (1554); Movie Grill Concepts XXX, LLC (1431); Movie Grill Concepts XXXI, LLC (3223); Movie Grill Concepts XXXII, LLC (0196); Movie Grill Concepts XXXIII, LLC (1505); Movie Grill Concepts XXXIV, LLC (9770); Movie Grill Concepts XXXIX, LLC (3605); Movie Grill Concepts XXXV, LLC (0571); Movie Grill Concepts XXXVI, LLC (6927); Movie Grill Concepts XXXVII, LLC (6401); Movie Grill Concepts XXXVIII, LLC (9657); Movie Grill Concepts XXIII, LLC (7893); Studio Club, LLC (3023); Studio Club IV, LLC (9440); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLVI, LLC (2344); Movie Grill Concepts XLVII, LLC (5866); Movie Grill Concepts XLVIII, LLC (8601); Movie Grill Concepts XLIX, LLC (0537); Movie Grill Concepts L, LLC (5940); Movie Grill Concepts LI, LLC (7754); Movie Grill Concepts LII, LLC (8624); Movie

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the above-referenced bankruptcy case ("Bankruptcy Case"). The Debtors are operating their businesses and managing their affairs as debtors-in-possession under 11 U.S.C §§ 1107 and 1108. 2. On December 21, 2020, the Debtors filed their Amended Notice of Executory Contracts and Unexpired Leases Which May be Assumed and Assigned, Pursuant to Section 365 of the Bankruptcy Code, in Connection with the Sale of Substantially All of the Debtors' Assets and the Proposed Cure Amounts with Respect Thereto ("Assumption Notice")[Docket No. 364]. The Assumption Notice provides that the Debtors may assume the designated contracts and leases identified on the schedule attached thereto and sets forth the Debtors' contention as to the amounts they believe are required to cure all existing defaults to satisfy the requirements for assumption of the agreements under Section 365(b)(1) of the Bankruptcy Code. 3. The Debtors' Assumption Notice designates for assumption under Section 365(a) that certain unexpired nonresidential real property lease between Reserve Capital, as landlord, and SMG Holdings, as tenant, covering the commercial office space in the building commonly known as Hidden Grove at Park Central, located at 12404 Park Central Drive, Dallas, Texas (the "Lease"). The Lease is evidenced by that certain Office Lease Agreement dated July 1, 2016 originally executed by SMG Holdings and Reserve Capital's predecessor-in-interest, Red River Park Central, L.L.C., together with the First Amendment to Lease dated September 4, 2019, the Second Amendment to Lease dated November 15, 2019 and the Third Amendment to Lease dated June 11, 2020. 4. Pursuant to the schedule attached to the Assumption Notice, the Debtors allege that the current monetary defaults to be cured as a condition to assumption of the Lease total $33,683.64 ("Proposed Cure Amount"). 5. Reserve Capital disputes the Proposed Cure Amount in the Assumption Notice and would show that the monetary defaults under the Lease as of the filing of this Objection total at least $356,237.24. Attached hereto as Exhibit "A" is a schedule prepared from Reserve Capital's books and records which reflects the breakdown of the unpaid and outstanding prepetition obligations under the Lease, including

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base rent, additional rent, CAM recoveries, parking and sales tax, tenant bill-back charges, late fees and an obligation to replenish SMG Holding's security deposit. Additionally, Reserve Capital is entitled to attorneys' fees and costs incurred as a result of SMG Holdings' defaults under the Lease. 6. Pursuant to Section 365(b)(1)(A) and (B), the Debtors must cure any defaults under the Lease and provide compensation for any pecuniary loss in connection with any proposed assumption of an executory contract, and provide adequate assurance of future performance as required by Section 365(b)(1)(C). The Debtors' Proposed Cure Claim is substantially less than the actual obligations which are currently outstanding under the Lease as detailed in Exhibit A. Reserve Capital hereby objects to the Proposed Cure Amount as stated by the Debtors and asserts that all existing defaults in the aggregate amount of at least $356,237.24 must be paid by the Debtors to Reserve Capital as a condition to assumption of the Lease and at the time such Lease is assumed. 7. This Objection is limited to the Debtors' stated Proposed Cure Claim under the Assumption Notice. Reserve Capital does not oppose the Debtors' process to identify a proposed purchaser and assignee of the Lease at this time, but is entitle to and hereby requests adequate assurance of future performance under the Lease with respect to any assumption. Reserve Capital accordingly reserves all other rights and potential objections following adequate and sufficient notice of the intended sale transaction and the financial support for the future performance of the Lease. WHEREFORE PREMISES CONSIDERED Reserve Capital respectfully requests (i) that the Proposed Cure Amount set forth in the Assumption Notice be corrected to reflect the actual prepetition defaults under the Lease in the aggregate amount of $356,237.24; (ii) that Reserve Capital be paid the total corrected cure amount of $356,237.24 plus attorneys' fees and costs as allowed under Title 11 and all other amounts required to compensate Reserve Capital for defaults arising through the effective date of any assumption and assignment of the Lease; and (iii) that Reserve Capital be awarded such other and further relief to which it may be justly entitled at law or in equity.

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Dated: January 13, 2021. Respectfully submitted, By: /s/ Joe E. Marshall Joe E. Marshall TX State Bar No. 13031100 Marshall Law 3131 McKinney Ave., Suite 600 Dallas, TX 75204 (214) 579-9173 jmarshall@marshalllaw.net COUNSEL FOR RESERVE CAPITAL – HIDDEN GROVE SPE, LLC CERTIFICATE OF SERVICE The undersigned counsel hereby certifies that on this 13th day of January 2021, this Objection was served per the Court’s ECF system to all those entitled to notice thereby and on the following parties via electronic mail pursuant to the Assumption Notice. Frank J. Wright (frank@fjwright.law) Jeffrey Pomerantz (jpomerantz@pszjlaw.com) Jeffery M. Veteto (jeff@fjwright.law) Robert Feinstein (rfeinstein@pszjlaw.com) Law Offices of Frank J. Wright Steven Golden (sgolden@pszjlaw.com) 2323 Ross Avenue, Suite 730 Pachulski Stang Ziehl & Jones LLP Dallas, TX 75201 780 Third Avenue, 34th Floor New York, NY 10017 William L. Wallander (bwallander@velaw.com) Bradley R. Foxman (bfoxman@velaw.com) Ryan Manns Vinson & Elkins LLP (ryan.manns@nortonrosefulbright.com) 2001 Ross Avenue, Suite 3900 Norton Rose Fulbright US LLP Dallas, TX 75201 2200 Ross Avenue, Suite 3600 Dallas, TX 75201 John E. Mazey (jemazey@jonesday.com) Michael C. Schneidereit Meredyth Kippes (mschneidereit@jonesday.com) (Meredyth_A_Kippes@usdoj.gov) Nicholas J. Morin (nmorin@jonesday.com) United States Trustee Jones Day 1100 Commerce St. Rm. 976 250 Vesey Street Dallas, TX 75242 New York, NY 10281 By: /s/ Joe E. Marshall Joe E. Marshall