[JPL] Tower Records to Sell Company Under Chapter 11 Sale Process

Jazz Promo Services jazzpromo at earthlink.net
Mon Aug 21 12:50:37 EDT 2006


Press Release Source: Tower Records


Tower Records to Sell Company Under Chapter 11 Sale Process
Sunday August 20, 10:09 pm ET
Enters into $85 million in Debtor in Possession Financing; Negotiates
Delivery Terms 
with Key Vendor Partners; Stores Remain Open ... Business as Usual


SACRAMENTO, Calif., Aug. 20 /PRNewswire/ -- MTS Incorporated and its
subsidiaries (Tower Records), America's leading independent music and
entertainment retailer which owns and operates 89 Tower Records stores in 20
states nationwide, tonight announced its intent to sell the Company through
a 
process (Section 363) under Chapter 11 of the Bankruptcy Code. This process,
which is subject to court approval, sets in motion a timeline of events that
will 
ultimately insure a sale of the Company within approximately 60 days of the
filing 
date.
 
 
According to Joseph D'Amico, Tower's recently named CEO, the filing is a
necessary 
vehicle to execute his commitment to sell the Company. "Tower Records has
conducted an extensive sale process and this step will allow buyers to
complete a 
sale in time for the holiday season while maximizing the value for
stakeholders." In 
March of 2006, the Company retained Houlihan Lokey Howard & Zukin as its
marketing and sales agent. The Company is evaluating Letters of Intent from
parties 
interested in acquiring the Company. Mr. D'Amico stated, "Potential parties
seeking 
to acquire Tower Records recognize the strength of the brand and its unique
position 
within the marketplace, making it a very attractive opportunity."

The Company also announced that it has entered into an $85 million Debtor in
Possession financing with its current bank group led by CIT as agent. This
financing 
will fund its operations and purchases of new product while the Company
completes 
the sale. Tower has also been able to renegotiate delivery terms for product
with the 
trade. D'Amico commented, "The trade has always supported Tower through
difficult 
times and we recognize that their support is imperative to the consummation
of a 
transaction."

Last week, Tower was voted 'Retailer of the Year' (Large Division) at the
48th annual 
National Association of Recording Merchandisers (NARM) convention for the
third 
consecutive year. "Tower Records is a great brand that has a unique place in
the 
market. I am confident that the brand will continue to endure for many years
to 
come," added D'Amico.

Visit http://www.omnimgt.com to view filing documentation by clicking "Real
Time 
Data" and Tower Records 2006.

About Tower Records

Since 1960, Tower Records has been recognized and respected throughout the
world for its unique brand of retailing. Founded in Sacramento, California,
with the 
singular vision to have a music store with unparalleled selection and fair
prices, 
Tower forges ahead with the development of exciting shopping environments,
espousing diverse product ranges, artist performances, and technological
advances 
in merchandising. Tower maintains its commitment to providing the deepest
selection of entertainment merchandise in stores that celebrate the unique
interests 
and needs of the local community. For the third year in a row, the music
industry has 
voted Tower Records "Retailer of the Year."

Tower owns and operates 89 stores in the U.S. with 144 additional stores run
by 
licensees in nine different countries. The Company opened one of the first
Internet 
music stores on America Online in June 1995 and followed a year later with
the 
launch of Tower.com.




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