Bended Page, LLC, the owner and operator of Tattered Cover, a chain of four bookstores in and around Denver, has filed a motion with the U.S. Bankruptcy Court for the District of Colorado to reschedule the hearing, currently set for May 28, to consider confirmation of its reorganization plan. The company, which is entertaining offers to purchase the bookstore, is asking for a delay until at least June 17.
Tattered Cover's board of directors, which includes Read Colorado, its current debtor-in-possession (DIP) lender, said that the sale of the store to a qualified buyer was "in the best long-term interests of the company, current investors, employees, suppliers, and Colorado’s literary community." In arguing for a sale, attorneys for the store said that the financial performance of Tattered Cover has improved dramatically since it received the new financing last year, pointing out that sales in February were up 14% over 2023 and that sales through March 28 rose 20%.
The motion attributed the higher sales to better book selection due to improved inventories, enhanced marketing efforts, and better author and community events. The combination of the improvement in sales and day-to-day operations has resulted in different parties asking about the possibility of buying the store. To that end, the motion argued that a delay in the reorganization hearing will help to facilitate a sale by, among other things, facilitating the approval of any amendments necessary to close the purchase of the store. The motion adds that the DIP "anticipates moving forward with a sale process, including seeking approval of bid procedures, promptly."
Tattered Cover filed for Chapter 11 in October 2023 and immediately closed three of its 10 stores and laid off about one third of its staff of just over 100. It filed a reorganization plan in January, then updated the plan in March.
"Read Colorado’s DIP loan was the lifeline that allowed Tattered Cover to rework itself into a strong position to be acquired by people who share our commitment to independent bookstores," CEO Brad Dempsey said in a release. "It supported ongoing operations so we could pay wages and benefits for more than 70 employees, as well as severance to those we had to let go when we consolidated our store locations. We were able to keep paying rent at our four local stores, host many terrific events, and paid more than $300,000 in sales taxes to the communities we serve."
