11 U.S.C. § 365 : US Code - Section 365: Executory contracts and unexpired leases

      (a) Except as provided in sections 765 and 766 of this title and
    in subsections (b), (c), and (d) of this section, the trustee,
    subject to the court's approval, may assume or reject any executory
    contract or unexpired lease of the debtor.
      (b)(1) If there has been a default in an executory contract or
    unexpired lease of the debtor, the trustee may not assume such
    contract or lease unless, at the time of assumption of such
    contract or lease, the trustee - 
        (A) cures, or provides adequate assurance that the trustee will
      promptly cure, such default other than a default that is a breach
      of a provision relating to the satisfaction of any provision
      (other than a penalty rate or penalty provision) relating to a
      default arising from any failure to perform nonmonetary
      obligations under an unexpired lease of real property, if it is
      impossible for the trustee to cure such default by performing
      nonmonetary acts at and after the time of assumption, except that
      if such default arises from a failure to operate in accordance
      with a nonresidential real property lease, then such default
      shall be cured by performance at and after the time of assumption
      in accordance with such lease, and pecuniary losses resulting
      from such default shall be compensated in accordance with the
      provisions of this paragraph;
        (B) compensates, or provides adequate assurance that the
      trustee will promptly compensate, a party other than the debtor
      to such contract or lease, for any actual pecuniary loss to such
      party resulting from such default; and
        (C) provides adequate assurance of future performance under
      such contract or lease.

      (2) Paragraph (1) of this subsection does not apply to a default
    that is a breach of a provision relating to - 
        (A) the insolvency or financial condition of the debtor at any
      time before the closing of the case;
        (B) the commencement of a case under this title;
        (C) the appointment of or taking possession by a trustee in a
      case under this title or a custodian before such commencement; or
        (D) the satisfaction of any penalty rate or penalty provision
      relating to a default arising from any failure by the debtor to
      perform nonmonetary obligations under the executory contract or
      unexpired lease.

      (3) For the purposes of paragraph (1) of this subsection and
    paragraph (2)(B) of subsection (f), adequate assurance of future
    performance of a lease of real property in a shopping center
    includes adequate assurance - 
        (A) of the source of rent and other consideration due under
      such lease, and in the case of an assignment, that the financial
      condition and operating performance of the proposed assignee and
      its guarantors, if any, shall be similar to the financial
      condition and operating performance of the debtor and its
      guarantors, if any, as of the time the debtor became the lessee
      under the lease;
        (B) that any percentage rent due under such lease will not
      decline substantially;
        (C) that assumption or assignment of such lease is subject to
      all the provisions thereof, including (but not limited to)
      provisions such as a radius, location, use, or exclusivity
      provision, and will not breach any such provision contained in
      any other lease, financing agreement, or master agreement
      relating to such shopping center; and
        (D) that assumption or assignment of such lease will not
      disrupt any tenant mix or balance in such shopping center.

      (4) Notwithstanding any other provision of this section, if there
    has been a default in an unexpired lease of the debtor, other than
    a default of a kind specified in paragraph (2) of this subsection,
    the trustee may not require a lessor to provide services or
    supplies incidental to such lease before assumption of such lease
    unless the lessor is compensated under the terms of such lease for
    any services and supplies provided under such lease before
    assumption of such lease.
      (c) The trustee may not assume or assign any executory contract
    or unexpired lease of the debtor, whether or not such contract or
    lease prohibits or restricts assignment of rights or delegation of
    duties, if - 
        (1)(A) applicable law excuses a party, other than the debtor,
      to such contract or lease from accepting performance from or
      rendering performance to an entity other than the debtor or the
      debtor in possession, whether or not such contract or lease
      prohibits or restricts assignment of rights or delegation of
      duties; and
        (B) such party does not consent to such assumption or
      assignment; or
        (2) such contract is a contract to make a loan, or extend other
      debt financing or financial accommodations, to or for the benefit
      of the debtor, or to issue a security of the debtor; or
        (3) such lease is of nonresidential real property and has been
      terminated under applicable nonbankruptcy law prior to the order
      for relief.

      (d)(1) In a case under chapter 7 of this title, if the trustee
    does not assume or reject an executory contract or unexpired lease
    of residential real property or of personal property of the debtor
    within 60 days after the order for relief, or within such
    additional time as the court, for cause, within such 60-day period,
    fixes, then such contract or lease is deemed rejected.
      (2) In a case under chapter 9, 11, 12, or 13 of this title, the
    trustee may assume or reject an executory contract or unexpired
    lease of residential real property or of personal property of the
    debtor at any time before the confirmation of a plan but the court,
    on the request of any party to such contract or lease, may order
    the trustee to determine within a specified period of time whether
    to assume or reject such contract or lease.
      (3) The trustee shall timely perform all the obligations of the
    debtor, except those specified in section 365(b)(2), arising from
    and after the order for relief under any unexpired lease of
    nonresidential real property, until such lease is assumed or
    rejected, notwithstanding section 503(b)(1) of this title. The
    court may extend, for cause, the time for performance of any such
    obligation that arises within 60 days after the date of the order
    for relief, but the time for performance shall not be extended
    beyond such 60-day period. This subsection shall not be deemed to
    affect the trustee's obligations under the provisions of subsection
    (b) or (f) of this section. Acceptance of any such performance does
    not constitute waiver or relinquishment of the lessor's rights
    under such lease or under this title.
      (4)(A) Subject to subparagraph (B), an unexpired lease of
    nonresidential real property under which the debtor is the lessee
    shall be deemed rejected, and the trustee shall immediately
    surrender that nonresidential real property to the lessor, if the
    trustee does not assume or reject the unexpired lease by the
    earlier of - 
        (i) the date that is 120 days after the date of the order for
      relief; or
        (ii) the date of the entry of an order confirming a plan.

      (B)(i) The court may extend the period determined under
    subparagraph (A), prior to the expiration of the 120-day period,
    for 90 days on the motion of the trustee or lessor for cause.
      (ii) If the court grants an extension under clause (i), the court
    may grant a subsequent extension only upon prior written consent of
    the lessor in each instance.
      (5) The trustee shall timely perform all of the obligations of
    the debtor, except those specified in section 365(b)(2), first
    arising from or after 60 days after the order for relief in a case
    under chapter 11 of this title under an unexpired lease of personal
    property (other than personal property leased to an individual
    primarily for personal, family, or household purposes), until such
    lease is assumed or rejected notwithstanding section 503(b)(1) of
    this title, unless the court, after notice and a hearing and based
    on the equities of the case, orders otherwise with respect to the
    obligations or timely performance thereof. This subsection shall
    not be deemed to affect the trustee's obligations under the
    provisions of subsection (b) or (f). Acceptance of any such
    performance does not constitute waiver or relinquishment of the
    lessor's rights under such lease or under this title.
      (e)(1) Notwithstanding a provision in an executory contract or
    unexpired lease, or in applicable law, an executory contract or
    unexpired lease of the debtor may not be terminated or modified,
    and any right or obligation under such contract or lease may not be
    terminated or modified, at any time after the commencement of the
    case solely because of a provision in such contract or lease that
    is conditioned on - 
        (A) the insolvency or financial condition of the debtor at any
      time before the closing of the case;
        (B) the commencement of a case under this title; or
        (C) the appointment of or taking possession by a trustee in a
      case under this title or a custodian before such commencement.

      (2) Paragraph (1) of this subsection does not apply to an
    executory contract or unexpired lease of the debtor, whether or not
    such contract or lease prohibits or restricts assignment of rights
    or delegation of duties, if - 
        (A)(i) applicable law excuses a party, other than the debtor,
      to such contract or lease from accepting performance from or
      rendering performance to the trustee or to an assignee of such
      contract or lease, whether or not such contract or lease
      prohibits or restricts assignment of rights or delegation of
      duties; and
        (ii) such party does not consent to such assumption or
      assignment; or
        (B) such contract is a contract to make a loan, or extend other
      debt financing or financial accommodations, to or for the benefit
      of the debtor, or to issue a security of the debtor.

      (f)(1) Except as provided in subsections (b) and (c) of this
    section, notwithstanding a provision in an executory contract or
    unexpired lease of the debtor, or in applicable law, that
    prohibits, restricts, or conditions the assignment of such contract
    or lease, the trustee may assign such contract or lease under
    paragraph (2) of this subsection.
      (2) The trustee may assign an executory contract or unexpired
    lease of the debtor only if - 
        (A) the trustee assumes such contract or lease in accordance
      with the provisions of this section; and
        (B) adequate assurance of future performance by the assignee of
      such contract or lease is provided, whether or not there has been
      a default in such contract or lease.

      (3) Notwithstanding a provision in an executory contract or
    unexpired lease of the debtor, or in applicable law that terminates
    or modifies, or permits a party other than the debtor to terminate
    or modify, such contract or lease or a right or obligation under
    such contract or lease on account of an assignment of such contract
    or lease, such contract, lease, right, or obligation may not be
    terminated or modified under such provision because of the
    assumption or assignment of such contract or lease by the trustee.
      (g) Except as provided in subsections (h)(2) and (i)(2) of this
    section, the rejection of an executory contract or unexpired lease
    of the debtor constitutes a breach of such contract or lease - 
        (1) if such contract or lease has not been assumed under this
      section or under a plan confirmed under chapter 9, 11, 12, or 13
      of this title, immediately before the date of the filing of the
      petition; or
        (2) if such contract or lease has been assumed under this
      section or under a plan confirmed under chapter 9, 11, 12, or 13
      of this title - 
          (A) if before such rejection the case has not been converted
        under section 1112, 1208, or 1307 of this title, at the time of
        such rejection; or
          (B) if before such rejection the case has been converted
        under section 1112, 1208, or 1307 of this title - 
            (i) immediately before the date of such conversion, if such
          contract or lease was assumed before such conversion; or
            (ii) at the time of such rejection, if such contract or
          lease was assumed after such conversion.

      (h)(1)(A) If the trustee rejects an unexpired lease of real
    property under which the debtor is the lessor and - 
        (i) if the rejection by the trustee amounts to such a breach as
      would entitle the lessee to treat such lease as terminated by
      virtue of its terms, applicable nonbankruptcy law, or any
      agreement made by the lessee, then the lessee under such lease
      may treat such lease as terminated by the rejection; or
        (ii) if the term of such lease has commenced, the lessee may
      retain its rights under such lease (including rights such as
      those relating to the amount and timing of payment of rent and
      other amounts payable by the lessee and any right of use,
      possession, quiet enjoyment, subletting, assignment, or
      hypothecation) that are in or appurtenant to the real property
      for the balance of the term of such lease and for any renewal or
      extension of such rights to the extent that such rights are
      enforceable under applicable nonbankruptcy law.

      (B) If the lessee retains its rights under subparagraph (A)(ii),
    the lessee may offset against the rent reserved under such lease
    for the balance of the term after the date of the rejection of such
    lease and for the term of any renewal or extension of such lease,
    the value of any damage caused by the nonperformance after the date
    of such rejection, of any obligation of the debtor under such
    lease, but the lessee shall not have any other right against the
    estate or the debtor on account of any damage occurring after such
    date caused by such nonperformance.
      (C) The rejection of a lease of real property in a shopping
    center with respect to which the lessee elects to retain its rights
    under subparagraph (A)(ii) does not affect the enforceability under
    applicable nonbankruptcy law of any provision in the lease
    pertaining to radius, location, use, exclusivity, or tenant mix or
    balance.
      (D) In this paragraph, "lessee" includes any successor, assign,
    or mortgagee permitted under the terms of such lease.
      (2)(A) If the trustee rejects a timeshare interest under a
    timeshare plan under which the debtor is the timeshare interest
    seller and - 
        (i) if the rejection amounts to such a breach as would entitle
      the timeshare interest purchaser to treat the timeshare plan as
      terminated under its terms, applicable nonbankruptcy law, or any
      agreement made by timeshare interest purchaser, the timeshare
      interest purchaser under the timeshare plan may treat the
      timeshare plan as terminated by such rejection; or
        (ii) if the term of such timeshare interest has commenced, then
      the timeshare interest purchaser may retain its rights in such
      timeshare interest for the balance of such term and for any term
      of renewal or extension of such timeshare interest to the extent
      that such rights are enforceable under applicable nonbankruptcy
      law.

      (B) If the timeshare interest purchaser retains its rights under
    subparagraph (A), such timeshare interest purchaser may offset
    against the moneys due for such timeshare interest for the balance
    of the term after the date of the rejection of such timeshare
    interest, and the term of any renewal or extension of such
    timeshare interest, the value of any damage caused by the
    nonperformance after the date of such rejection, of any obligation
    of the debtor under such timeshare plan, but the timeshare interest
    purchaser shall not have any right against the estate or the debtor
    on account of any damage occurring after such date caused by such
    nonperformance.
      (i)(1) If the trustee rejects an executory contract of the debtor
    for the sale of real property or for the sale of a timeshare
    interest under a timeshare plan, under which the purchaser is in
    possession, such purchaser may treat such contract as terminated,
    or, in the alternative, may remain in possession of such real
    property or timeshare interest.
      (2) If such purchaser remains in possession - 
        (A) such purchaser shall continue to make all payments due
      under such contract, but may, offset against such payments any
      damages occurring after the date of the rejection of such
      contract caused by the nonperformance of any obligation of the
      debtor after such date, but such purchaser does not have any
      rights against the estate on account of any damages arising after
      such date from such rejection, other than such offset; and
        (B) the trustee shall deliver title to such purchaser in
      accordance with the provisions of such contract, but is relieved
      of all other obligations to perform under such contract.

      (j) A purchaser that treats an executory contract as terminated
    under subsection (i) of this section, or a party whose executory
    contract to purchase real property from the debtor is rejected and
    under which such party is not in possession, has a lien on the
    interest of the debtor in such property for the recovery of any
    portion of the purchase price that such purchaser or party has
    paid.
      (k) Assignment by the trustee to an entity of a contract or lease
    assumed under this section relieves the trustee and the estate from
    any liability for any breach of such contract or lease occurring
    after such assignment.
      (l) If an unexpired lease under which the debtor is the lessee is
    assigned pursuant to this section, the lessor of the property may
    require a deposit or other security for the performance of the
    debtor's obligations under the lease substantially the same as
    would have been required by the landlord upon the initial leasing
    to a similar tenant.
      (m) For purposes of this section 365 and sections 541(b)(2) and
    362(b)(10), leases of real property shall include any rental
    agreement to use real property.
      (n)(1) If the trustee rejects an executory contract under which
    the debtor is a licensor of a right to intellectual property, the
    licensee under such contract may elect - 
        (A) to treat such contract as terminated by such rejection if
      such rejection by the trustee amounts to such a breach as would
      entitle the licensee to treat such contract as terminated by
      virtue of its own terms, applicable nonbankruptcy law, or an
      agreement made by the licensee with another entity; or
        (B) to retain its rights (including a right to enforce any
      exclusivity provision of such contract, but excluding any other
      right under applicable nonbankruptcy law to specific performance
      of such contract) under such contract and under any agreement
      supplementary to such contract, to such intellectual property
      (including any embodiment of such intellectual property to the
      extent protected by applicable nonbankruptcy law), as such rights
      existed immediately before the case commenced, for - 
          (i) the duration of such contract; and
          (ii) any period for which such contract may be extended by
        the licensee as of right under applicable nonbankruptcy law.

      (2) If the licensee elects to retain its rights, as described in
    paragraph (1)(B) of this subsection, under such contract - 
        (A) the trustee shall allow the licensee to exercise such
      rights;
        (B) the licensee shall make all royalty payments due under such
      contract for the duration of such contract and for any period
      described in paragraph (1)(B) of this subsection for which the
      licensee extends such contract; and
        (C) the licensee shall be deemed to waive - 
          (i) any right of setoff it may have with respect to such
        contract under this title or applicable nonbankruptcy law; and
          (ii) any claim allowable under section 503(b) of this title
        arising from the performance of such contract.

      (3) If the licensee elects to retain its rights, as described in
    paragraph (1)(B) of this subsection, then on the written request of
    the licensee the trustee shall - 
        (A) to the extent provided in such contract, or any agreement
      supplementary to such contract, provide to the licensee any
      intellectual property (including such embodiment) held by the
      trustee; and
        (B) not interfere with the rights of the licensee as provided
      in such contract, or any agreement supplementary to such
      contract, to such intellectual property (including such
      embodiment) including any right to obtain such intellectual
      property (or such embodiment) from another entity.

      (4) Unless and until the trustee rejects such contract, on the
    written request of the licensee the trustee shall - 
        (A) to the extent provided in such contract or any agreement
      supplementary to such contract - 
          (i) perform such contract; or
          (ii) provide to the licensee such intellectual property
        (including any embodiment of such intellectual property to the
        extent protected by applicable nonbankruptcy law) held by the
        trustee; and

        (B) not interfere with the rights of the licensee as provided
      in such contract, or any agreement supplementary to such
      contract, to such intellectual property (including such
      embodiment), including any right to obtain such intellectual
      property (or such embodiment) from another entity.

      (o) In a case under chapter 11 of this title, the trustee shall
    be deemed to have assumed (consistent with the debtor's other
    obligations under section 507), and shall immediately cure any
    deficit under, any commitment by the debtor to a Federal depository
    institutions regulatory agency (or predecessor to such agency) to
    maintain the capital of an insured depository institution, and any
    claim for a subsequent breach of the obligations thereunder shall
    be entitled to priority under section 507. This subsection shall
    not extend any commitment that would otherwise be terminated by any
    act of such an agency.
      (p)(1) If a lease of personal property is rejected or not timely
    assumed by the trustee under subsection (d), the leased property is
    no longer property of the estate and the stay under section 362(a)
    is automatically terminated.
      (2)(A) If the debtor in a case under chapter 7 is an individual,
    the debtor may notify the creditor in writing that the debtor
    desires to assume the lease. Upon being so notified, the creditor
    may, at its option, notify the debtor that it is willing to have
    the lease assumed by the debtor and may condition such assumption
    on cure of any outstanding default on terms set by the contract.
      (B) If, not later than 30 days after notice is provided under
    subparagraph (A), the debtor notifies the lessor in writing that
    the lease is assumed, the liability under the lease will be assumed
    by the debtor and not by the estate.
      (C) The stay under section 362 and the injunction under section
    524(a)(2) shall not be violated by notification of the debtor and
    negotiation of cure under this subsection.
      (3) In a case under chapter 11 in which the debtor is an
    individual and in a case under chapter 13, if the debtor is the
    lessee with respect to personal property and the lease is not
    assumed in the plan confirmed by the court, the lease is deemed
    rejected as of the conclusion of the hearing on confirmation. If
    the lease is rejected, the stay under section 362 and any stay
    under section 1301 is automatically terminated with respect to the
    property subject to the lease.