The Tattered Cowl, a beloved Denver establishment and nationally identified unbiased bookstore, has accepted a gross sales supply from Barnes & Noble, a mannequin for the fictionalized company bookstore chain that ran a small unbiased bookseller out of enterprise within the film “You’ve Received Mail.”
The 53-year-old Denver enterprise, which filed for Chapter 11 chapter in late 2023, agreed Monday to simply accept Barnes & Noble’s supply of as much as $1.83 million in money. The settlement is for Tattered Cowl’s 4 shops and is supported by the bookstore’s guardian firm, Bended Web page.
Underneath the settlement, the title of the Tattered Cowl E-book Retailer and the shop’s program of occasions would proceed, in accordance with a movement filed in U.S. Chapter Court docket for the District of Colorado. The client, TC Acquisition Co. LLC, an affiliate of Barnes & Noble Inc., anticipates providing jobs to “considerably all” of Tattered Cowl’s roughly 70 workers.
The acquisition will cowl the $1.6 million in secured claims that Tattered Cowl owes. Barnes & Noble can pay $50,000 for again lease and plans to increase the leases on the shop’s websites.
The lease on the shop’s most important location at East Colfax Avenue in Denver shall be prolonged by 2038 and the lease on the shop within the Aspen Grove procuring heart in Littleton would run by 2030, mentioned Steven Silvers, a spokesman for Bended Web page.
The sale will want the chapter courtroom’s approval. The closing is ready to happen by July 31.
The supply by Barnes & Noble, the nation’s largest retail bookseller with about 600 shops, was one among three submitted by the deadline. One bid got here from two Bended Web page board members and the opposite from a 3rd get together.
Tattered Cowl’s proprietor mentioned it canceled an public sale scheduled June 11 after one bidder dropped out and the opposite indicated it didn’t wish to take part in an public sale. Kwame Spearman, a co-founder of Bended Web page and the corporate’s former CEO, mentioned he and a companion submitted a suggestion.
Silvers mentioned the bid by Barnes & Noble was the one one which contemplated protecting all 4 shops open.
A complete of 9 events confirmed curiosity in shopping for the corporate and signed nondisclosure agreements. Whereas Tattered Cowl’s proprietor didn’t use a advertising and marketing agent or dealer, the corporate mentioned the chapter case and the chance to purchase the shop had been extensively identified and publicized.
No present homeowners or shareholders shall be concerned with Tattered Cowl after the sale, Silvers mentioned.
Brad Dempsey, who succeeded Spearman as CEO, mentioned he needed to discover a purchaser who would preserve Tattered Cowl’s tradition and focus. He mentioned in an interview in April that Tattered Cowl “is an extremely highly effective model throughout the nation” and his objective was to seek out consumers dedicated to protecting the doorways open.
Tattered Cowl’s renown as a fierce proponent of First Modification rights was constructed by Joyce Meskis, who purchased the shop in 1974 when it was a small store in Denver’s Cherry Creek North neighborhood. Underneath her possession, Tattered Cowl grew to become a gathering place and a middle of neighborhood occasions whereas preventing censorship and for the rights of readers and writers. Celebrities, high-profile politicians and former presidents participated in occasions on the retailer.
“This creates the nation’s first true hybrid bookstore, a daring and sustainable response to a market that’s dramatically completely different from when Joyce Meskis operated Tattered Cowl for therefore many many years,” Dempsey mentioned in a press release.
Tattered Cowl’s title and tradition will dwell on and the enterprise will proceed to serve the Denver space’s communities and shield First Modification rights, Dempsey added. “The mission and spirit of Tattered Cowl stays sturdy, with new sources, know-how and renewed power.”
James Daunt, CEO of Barnes & Noble, was an unbiased bookseller in London earlier than taking up as managing director of Waterstones, Britain’s largest bookstore chain in 2011. Daunt was named CEO of Barnes & Noble in 2019 by a hedge fund that purchased each corporations.
A 2023 story by The Guardian mentioned that Daunt’s method at Barnes & Noble has been the identical because the one at Waterstones: to take the “company” out of a company bookstore chain, permitting shops to cater to their communities and supply one thing completely different from Amazon.
“Amazon doesn’t care about books … a e book is simply one other factor in a warehouse,” Daunt instructed The Guardian. “Whereas bookstores are locations of discovery. They’re simply very nice areas.”
The street to Tattered Cowl’s sale to a company bookstore chain ran by two modifications of possession and a pandemic. The COVID-19 pandemic, which hit many small companies laborious, took its toll. Tattered Cowl confronted unrelenting competitors from Amazon and different on-line marketplaces.
Dempsey additionally believes the earlier purchases of the bookstores had been under-financed. Tattered Cowl closed three of its seven shops and eradicated roughly 1 / 4 of the corporate’s jobs in late 2023 to cut back losses.
In 2015, Meskis introduced plans to promote the Tattered Cowl bookstores. E-book-industry veterans Len Vlahos and his spouse Kristen Gilligan acquired controlling curiosity within the enterprise in 2017.
Bended Web page, co-founded by Denver natives Spearman and David Again, purchased the struggling firm in 2020. A $1.275 million mortgage from Learn Colorado LLC, which incorporates two of the corporate’s board members, allowed Tattered Cowl to beef up its stock.
Bended Web page opened new shops, together with one in Colorado Springs, a transfer that some workers mentioned strained sources and the workers. Staff complained of being overworked and under-paid.
Tattered Cowl’s 2022 monetary outcomes supplied to JHB by an investor who didn’t wish to be named present that excluding federal COVID-19 stimulus funds, the bookstore’s internet loss was $577,000. Revenues totaled $10.626 million and prices had been $11.2 million.
Spearman took a depart of absence as CEO in 2023 to run for Denver mayor after which stepped down forward of an unsuccessful run for the Denver college board.
Tattered Cowl filed for reorganization lower than a yr after the demise of Meskis in December 2022. The guardian firm put the bookstore up on the market in March.