The Denver-based bootseller Freebird has left its corporate headquarters in Cherry Creek, laid off staff, and is closing at least 14 of its 20 stores while it works to find a buyer.
Freebird has been under the control of a court-appointed caretaker, the turnaround company Ampleo, since being sued by KeyBank in May for allegedly not repaying $15.4 million.
“The receiver learned in the first few days that the company remains in a precarious financial situation” and “a severe liquidity crisis,” Ampleo’s Doug Charboneau wrote June 9.
That includes owing $6 million to a manufacturer in Mexico that supplies 85% of its shoes. The bootmaker has gone out of business as a result of Freebird’s unpaid invoices.
“Without product being shipped to replenish inventory and without any apparent refinancing options remaining, the receiver had to take quick action,” Charboneau explained in a receiver report to Denver District Judge Jill Dorancy, who appointed him May 20.
On June 2, Charboneau “started closing the worst performing stores, vacating its corporate office and reducing staff,” he wrote. The receiver has begun closing 14 stores and will close another four on Monday if a buyer isn’t found. That would leave just two stores.
Charboneau declined to be interviewed about which stores are being closed and how many workers are out of a job. The company had four locations in Colorado when he was appointed: Its flagship in Cherry Creek and others in Boulder, Lone Tree and Castle Rock.
“No comment,” Charboneau told BusinessDen when asked. “The report speaks for itself.”
On June 6, the company’s HQ at 2955 E. First Ave. in Cherry Creek was closed. Furniture was removed and computers were wiped clean so they can be auctioned off.
In a move that may surprise customers, Charboneau has decided that all new Freebird sales are final and no products can be returned, according to his receiver report.
KeyBank supports Charboneau’s shrinking of Freebird, he says, “as the best path to achieve the highest value return, but by no means is it anticipated to result in a full recovery.”
Charboneau has also been on the lookout for buyers for the company. Last week, he was “in active negotiations with two” who have signed nondisclosure agreements, he wrote.
“While a sale outcome remains uncertain, the receiver will continue to pursue that path in tandem with the receiver’s store closure plan to reduce operational costs.”
Freebird boots are handmade and range in price from $200 to $400. CEO Mike Murphy, who founded the company in 2009, declined to comment on Charboneau’s actions.
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