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News From Furninfo.com Message Board About Rhodes Bankruptcy

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Readers can add more information to this message board blog at the following link: http://www.furninfo.com/forum/message_view.asp?TID=9079&TPN=1 Question From: Bill Epps Status Of Rhodes Bankruptcy 6/7/2005 1:04:32 PM Can you tell me the status of the Rhodes Furniture Bankruptcy? Is the company about to be purchased? Are they going to close all their stores? Reply from Russell At Furniture World Magazine 6/7/2005 1:06:58 PM Bill, I don't think I've received any official information about store closings since the end of December. I've posted your messages so that furninfo.com readers can respond. I expect that their suppliers and reps will be able to tell us their status. -Russell Reply from bill 6/13/2005 7:10:15 AM Rhodes was unable to find a buyer and their CEO resigned. Reply from tamara 7/1/2005 1:23:34 PM I worked for Rhodes Furniture in Columbus, Ohio. They left us high and dry. No serverance package, no nothing. Do you know if the court proceedings are over? Or are they still in court? Reply from Furniture World Magazine 7/1/2005 1:44:16 PM Tamara, check out a news item posted last week to furninfo.com. "Rhodes, Inc. Files Chapter 11 Plan of Reorganization --- Rhodes, Inc. announced that it filed on June 20, 2005 a chapter 11 plan of reorganization and accompanying disclosure statement with the United States Bankruptcy Court for the Northern District of Georgia. Rhodes expects to emerge from bankruptcy by early fall. Joel H. Dugan, who has been named Chief Executive Officer and President of Rhodes effective July 5, 2005, stated "The filing of a chapter 11 plan by Rhodes is an important, first step towards exiting bankruptcy. Rhodes continues to implement its reorganization strategy and looks forward to concluding its chapter 11 case soon." Rhodes' current CEO, Steven S. Fishman, commented, "We appreciate very much all the support from our vendors and the hard work by our employees. This major development would not have been possible without them." That's all I know. -Russell Reply from Randy 7/15/2005 12:38:12 AM Well it doesnt seem to have hit the news yet. But as of 7-15-2005 Rhodes announced it will be closing all but a few stores on 8-15. The few they don't close have already been sold. And no were not getting severence packages either. The info from Mr. fishman and the others is false. and as of our meeting on the 7-14 even the regionals didn't know they we'd been sold. craps1@bigriver.net Reply from Reliable 7/15/2005 10:10:37 AM All Atlanta stores are closing including the corporate office. The company has been bought out. More info to come Reply from Hank 7/17/2005 10:19:47 AM Steve Fishman conned every one for a year.now hes gone to gone to big lots to put them out of business like Franks and Rhodes. Dugan is not much better. Reply from anonymous 7/18/2005 9:56:23 AM Please forgive my being anonymous, but I have much info that is not public. The backruptcy court has approved a buyout by Roomstores, The deal is done on August 15. All but 28 stores are to be closed including all of Georgia including headquarters. Roomstores is the sole remaining entity from the old Heilig-Meyers. It is also the golden parachute for the H.M. CEO, Curtis Kimbrell. On his board of directors include a former VP of Levitz Furniture, and the financial officer for Klausner Furniture. All earlier bids for purchase were rejected by the court in June, including Sun Capital's. Little Roomstores emerged from bankruptcy in June with a 30,000,000. operating capital-an amount that is nothing in the furniture world. So, how did they bite off Rhodes. There is another player at the table. Look at the board of directors...Klausner ownes Sofa Express...I see a major expansion in the next 12-18 months...BTW, the company ruumor mill suggests a golden parachute for the altanta senior management team and senior store managers...Question? If Kimbrell and H.M. did not know what to do with Rhodes before (and the mismanagement of Rhodes was a MAJOR contributer to H.M.'s downfall), what makes them think that they will be able to do anything right this time? Will let you know as more comes down. Reply from Jed 7/18/2005 12:30:42 PM How will the salesmen fare at the Florida Rhodes stores? Should they perhaps drop off some resumes-- maybe at Havertys? Reply from Jed 7/18/2005 12:47:23 PM Also confused about 'roomstores' in Texas, and 'The Roomstore Furniture' in SC and NC. Are they the same outfit? Reply from anonymous 7/18/2005 2:19:10 PM Jed, all of the stores in Florida are safe for the present, although Ormond Beach will not be long for this world if they lose the courtesy sales that should have gone through the Orlando stores. Roomstores are centered out of Texas. They do have stores in Virginia, Maryland, North Carolina, South Caroline, Texas, and have some sort of franchise/loose association with the stores in Arizona. Reply from Jed 7/18/2005 4:15:48 PM Any word on the commission structure? Rhodes is presently on two week volume cycles which is unique (I think) to the industry. I heard the new one might range from 31/2% to 7% and based on a monthly volume, but nobody knows what the volume scales are. 31/2% to $20,000 and 7% over $65,000? Reply from Albert 7/18/2005 7:02:30 PM I just left a Roomstore and spoke with the manager. He told me that his store had 439,000 in booked sales last month with 11 on his sales staff. Before a sales person can get 5% he/she must book $52,000. That would be an average of about 44,000 @ 4.5 percent. Who can make a living and support a family on $2,100 a month.? The store manager was very pleased with his sales in June. Former Rhodes sales staff will take a great cut in pay. Reply from Jed 7/18/2005 7:33:46 PM Albert, thanks for the info. It seems to be happening in the car business as well, where everything is becoming a 'mini.'and selling 15 cars grosses about $2,000. How in the world did Rhodes go bankrupt while paying such lousy commissions? Somebody made some money! Who's driving the Porches? Reply from Albert 7/18/2005 9:31:28 PM Sorry for the confusion. A sales person at Rhodes now makes 8% on 52,000. Sales people can make a good living @ 8% but not 4.5 to 7%. That is what the Roomstore pays. Why would Rhodes sales people in Florida want to keep their jobs with the Roomstore and their jobs commission is being cut so drastically. Rhodes starts off at 5% until 27,500 the 6% until 37,500 and then 7%. The cap is 8% at 47,500. Many of my friends in Florida are looking elsewhere. The quality of the furniture at the Roomstore is much lower that what Rhodes currently carries. The sales staff must write a lot of business to make close to the same salary. Most of the sales people at my store plan to give notice very soon. Why stay with the Roomstore and take a 35% pay cut?

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