It’s official, one of the largest remainder companies in the world is in the process of liquidating its assets. Strictly by-The Book, Inc. and Strictly by-The Book, LLC will liquidate in an ABC process … Assignment for the Benefit of Creditors. The process includes transferring all of Strictly’s assets to the Tron Group who will, effectively, act as Trustee to serve as Assignee for the benefit of creditors.
Strictly, considered to be one of the larger remainder companies in the country, peaked with revenue or over 50 million dollars while averaging 40 million dollars plus, before its demise. The company has been around since 1996 and grew meteorically by benefit of several contracts with larger publishers
Following are excerpts from the Tron Group to Strictly’s creditors:
“The purpose of this letter is to inform you of the recent financial difficulties of Strictly by-The Book, Inc and Strictly by-the Book, LLC and to recommend that you participate in an orderly wind down of the Company’s business. After an evaluation of the Company’s financial affairs, it was determined by the Company to terminate operations, liquidate assets and pay creditors through an ‘out-of court’ procedure.
“As a result of the recession, the Company encountered a slowdown in its business and a subsequent liquidity problem. The Company reduced expenses and hired an investment banker to raise equity and/or find a buyer for the Company. Unfortunately, these efforts were unsuccessful, and the Company’s legal and turnaround professionals advised the Company to immediately start winding down the operations with the focus of producing the largest recovery for all creditors.
“The nature of the Assignment is an orderly wind down of the assets and distribution of the proceeds to creditors according to the rules of priority established under the Bankruptcy Code.
“The Company made the Assignment, rather than file for Chapter 7 bankruptcy. Due to the nature of the Company’s business, the major asset is comprised of approximately 20 million dollars of book value inventory in various stages, i.e. in stacks sorted by author, and by title, in boxes sorted, unsorted or damaged. The actual value to be realized could be substantially less than this book value.
“The primary secured creditor, who is owed approximately 24 million dollars with a security interest in substantially all assets of the company, believes that this Assignment for the Benefit of Creditors is the best mechanism to maximize proceeds and minimize cost. The secured creditor has agreed that upon receipt of the first 10 million dollars from the proceeds of the liquidation, net of expenses funded to the Assignee, the secured creditor will permit the next $300,000 from the proceeds of the collateral to be paid to the Assignee in order to fund a dividend to allowed general unsecured claims.”
As Strictly winds down its operation, former Strictly Vice President of Sales, Jason Zutaut, hs announced the launching of a new company, Book Enterprises, and will display product at the Chicago International Remainder Book Exposition in November. The new company specializes in sorting hurts and buying remainders and close-outs.
For more information on the ABC assignment and distribution to creditors, contact Robert Wexler at 617-723-3786 or Bill Ash at 617-723-3785. Responsible comments can be emailed to "Letters to the Editor" at: valmay@bargainbooknews.com.
