In an attempt to preserve the company for the future, Bended Page LLC, which owns and operates the legendary Tattered Cover Book Store, filed the voluntary petition today, October 16. And while the filing is going through the court process — under Subchapter V, the reorganization is done in ninety days — Tattered will shutter three stores: The Westminster and Colorado Springs locations, both relatively new additions, will be closed by the end of this week; the McGregor Square location, which replaced the beloved 16th Street Mall spot, will close on October 28.
That will leave Tattered with four stores, not including the franchise shops at Denver International Airport: the flagship on East Colfax Avenue, the store in Union Station, the space in Aspen Grove in Littleton, and the location in Stanley Marketplace, on the edge of Aurora.
"Over the past three months, I've been organizing a restructuring and a recapitalization effort," says Brad Dempsey, who became interim CEO of the company in July and has since been named permanent CEO. "There's no better assignment for me right now in my time of life with my skill set. I love this company, and I'm fully committed."
He's also a lawyer with considerable experience in bankruptcy, and he saw that the Subchapter 5 provision, enacted during the pandemic to help small businesses, would be a more cost-efficient, streamlined process to get Tattered back on track. "It's one of the things Congress did right in the past five years," Dempsey notes.
"This is righteous work," he adds. "It's not just about books; it's about community."
Tattered Cover celebrated its fiftieth anniversary two years ago. It was founded as a small shop in Cherry Creek in 1971; the legendary Joyce Meskis purchased the business two years later and grew it into an independent bookstore with a national reputation for not only caring about books, but caring about the First Amendment — and protecting the privacy of its customers.
The crew at the Cherry Creek store in 1979; Joyce Meskis is center front.
Tattered Cover archives
The pandemic was not good to bookstores, and when he assumed leadership, Dempsey found that the problems were deeper and broader than anticipated. Consulting with financial leaders in New York, he realized that the company could not sustain seven stores. "We grew several stores over the last few years, over 45,000 square feet," he says. "Our inventory is very tiny, and we're disappointing our customers and our buyers, frankly."
The inventory from Colorado Springs will now go to Aspen Grove, and the Westminster inventory to the Colfax store. About 27 of the company's 101 workers will be laid off, most from the closed stores. "Our employees are what make Tattered Cover special," acknowledges Dempsey.
"My goal is to make sure this company is viable and on a very sustainable platform going forward," he adds. "Not worry about not paying bills, but focusing on customer service, living up to expectations."
According to bankruptcy documents, Tattered Cover lost $667,882 on revenues of $6.2 million from January 1 through the end of August. In the filing, the company listed $3.1 million in assets; it owes $2.2 million to its top twenty creditors, many of them book publishers.
While this isn't the first time Tattered Cover has faced a crisis, it's tough heading into the holidays. "We'll do our restructuring in our strongest quarter with a million dollars of financing and a leadership team behind the plan,"
Dempsey notes. Some of that financing could be unlocked at a hearing this week, and will be used to restock the Stanley and Union Station locations.
"We have a lot of customers who want to buy books, but we don't have enough books to sell them," says Dempsey. Other plans call for doubling down on the Friends of Tattered Cover program and beefing up events. "We're going to have a terrific holiday season at Colfax," he promises.
Book it.
