Rose Furniture, creditors' committee agree on plan

A committee of the key creditors of Rose Furniture Co. has reach an agreement with the company on a

payment plan designed to prevent a bankruptcy liquidation.
Rose Furniture, a long-time furniture retailer in High Point, announced last year that it would be going out of business. However, the company said last month that it was working on a plan that would allow it to remain open.
According to an announcement from attorneys representing Rose, the creditors’ committee agreed to a plan that would see Rose make cash payments of 11.5 percent of claims initially, to be followed by additional cash payments either over two years or within 45 days. Those creditors that allowed Rose longer to pay would receive an additional 18.5 percent of their total claims repaid, while those who wanted payment earlier would have only 3.5 percent additional repaid.
The plan also says that consumers who have cash deposits on purchases at the store would receive a 50 percent payment within on month, and either an additional 50 percent cash payment or 100 percent store credit within six months of the plan’s effective date.
The announcement said the agreement would result in higher payments to creditors than bankruptcy liquidation would because of the lower cost of legal fees to the company. Ninety percent of creditors will have to agree to the out-of-court settlement for it to take effect.