Thornton-based Ultimate Electronics is making plans to liquidate all 46 of its stores nationwide, including nine stores in Colorado, according to an email from the company's Chief Executive Officer, and documents filed in a federal bankruptcy court.
Liquidation sales at stores nationwide will start as soon as Wednesday, a liquidator inside the Thornton store told 9NEWS Sunday afternoon.
Ultimate Acquisition Partners LP, Ultimate Electronics parent company, filed for Chapter 11 bankruptcy on Jan. 26, hoping to save some of its stores, but the company could not meet its obligations to pay creditors and keep all stores operating.
The company said it owes its biggest creditor, GE Capital Corp., $64.8 million.
"We have spent the past week working on alternatives and unfortunately determined that the best course of action is to enter an organized and orderly liquidation process," Ultimate Electronics Chief Executive Officer Bruce Giesbrecht wrote to senior level executives in the company Saturday morning.
The email was provided to 9NEWS by a senior executive who requested anonymity.
The senior executive said Ultimate Electronics laid off nearly 40 corporate employees Jan. 27, immediately prior to the bankruptcy filing.
The executive also said several store locations had received closure notices from landlords because of non-payment.
"It's a sad story," said Dow Jones Newswire columnist Al Lewis. "This is a story of all of the confluences of our economy coming together and crushing a company that was actually crushed in the last economic downturn."
Ultimate Electronics previously filed bankruptcy in 2005, and the company reorganized itself under United Acquisition Partners CEO Mark Wattles.
Wattles was previously chairman and CEO of Hollywood Entertainment, which ran the now-defunct Hollywood Video stores.
Phone calls and emails to Wattles and other Ultimate Electronics officials went unreturned Sunday.
As for severance packages for employees, store managers will receive a ten percent retention bonus if they stay with the company through liquidation, according to the senior level executive.
It was unclear what type of severance other store employees would receive.
(KUSA-TV © 2011 Multimedia Holdings Corporation)