Rooms To Go to pay at least $2M for 10 Texas RoomStore units
April 9, 2012-- Furniture Today,
RICHMOND, Va. — Rooms To Go has agreed to pay at least $2 million for 10 Texas stores being shuttered by bankrupt RoomStore Inc., according to documents filed in U.S. Bankruptcy Court here.
The Seffner, Fla.-based Top 100 retailer also would pay Richmond-based RoomStore 100% of the value of each store's inventory, but will keep proceeds from the sale of any of the leases and conduct going-out-of-business sales at the stores.
In a motion asking the court to approve the transaction, RoomStore said the agreement with Rooms To Go "presents the highest and best offer" for the assets of the Texas stores. RoomStore said it had received three other offers for the store leases since filing for Chapter 11 bankruptcy protection on Dec. 12, but the highest was $700,000.
The court has scheduled a hearing for 2:30 p.m. Wednesday to rule on the proposed transaction.
Specifically, Rooms To Go has agreed to pay $1.7 million to acquire RoomStore's leases on the 10 stores; an additional $275,000 for the rights to use its name, trademarks and logo in Texas; and another $25,000 for customer lists.
According to the court filing, the proposed sale agreement gives Rooms To Go the right to force RoomStore to assume leases on seven of the stores prior to June 5, and can exercise the same rights on the other three stores before Oct. 5.
If Rooms To Go decides to exercise any of these rights, the retailer will have to pay the "cure amount" of the leases, which is the amount owed to the landlord to bring the lease payments current.
If the deal is approved, it would leave RoomStore with 28 stores - 11 in Maryland, including a clearance center, 10 in Virginia, five in North Carolina and two in South Carolina.