ACCESSORY PLACE FILES PETITION FOR CHAP. 11
NEW YORK — Struggling under the weight of too many bad leases and not enough cash to stock its stores, Accessory Place Inc., a 101-unit accessories specialty retailer, has filed for Chapter 11 protection.
In addition to lease and cash flow problems, Accessory Place, based in Leonia, N.J., said operations were hindered by increased competition and a difficult retail environment.
Accessory Place, which hopes to reject 45 of its leases while in Chapter 11, listed assets of $13.5 million and liabilities of $5.7 million, including about $2.4 million in unsecured debt.
Raymond H. Wechsler, chief executive officer, said in court papers that he had “exhausted all reasonable efforts to resuscitate existing unprofitable locations, which are a drain on Accessory Place’s financial and management resources.”
He said the petition was necessary to “ensure that working capital is not used to support unprofitable stores in unprofitable locations.”
At the same time it filed the Chapter 11 petition, Accessory Place filed a disclosure statement and reorganization plan. The plan could not be obtained from U.S. Bankruptcy Court Monday, and the company did not return calls seeking details of the plan.
In a statement, however, Accessory Place said its 85 percent owner, Royal Hawaiian Shopping Center Inc., will provide $2 million in financing and another $1.5 million equity infusion when the reorganization plan is confirmed.
The top unsecured creditors are Tri-Coastal Design, Fairfield, N.J., which is owed $177,544; Inverness Corp., Fairlawn, N.J., $109,589; O.D.Y. Accessories Inc., $106,258, and RGIS Inventory Specialists, $70,432, both here.
The Chapter 11 filing marks the second go-round in bankruptcy for Accessory Place. The firm filed for bankruptcy protection in 1992 and had its reorganization plan confirmed in January 1993. — Fairchild News Service