SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 8, 2007
REX STORES CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 001-09097 31-1095548
(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification No.)
2875 Needmore Road, Dayton, Ohio 45414
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (937) 276-3931
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
On February 8, 2007, REX Stores Corporation (the "Company") and its
subsidiaries Rex Radio and Television, Inc., Kelly & Cohen Appliances, Inc. and
Stereo Town, Inc., entered into a Purchase and Sale Agreement (the "Agreement")
with Coventry Real Estate Investments, LLC (the "Purchaser"). Pursuant to the
Agreement, the Company has agreed to sell to the Purchaser 94 of its current and
former store locations for approximately $84.0 million, before selling expenses,
and to leaseback a minimum of 40 of the properties for an initial lease term
expiring January 31, 2010. The leases will contain renewal options for up to 15
additional years. Either party may terminate a lease after the initial six
months of the initial lease term on 23 to 30 of the sites as selected by the
Company.
The Company is in the process of analyzing the allocation of the purchase
price to individual properties which have a carrying value of approximately
$66.5 million. Since the Company has not identified all of the properties it
intends to lease back from the Purchaser, the resulting gain to be recognized
cannot currently be determined. The Company intends to use the proceeds from the
sale to pay off approximately $17 to $19 million in mortgage debt related to
these properties, to fund its alternative energy projects and for other general
corporate purposes.
Closing of the transaction is subject to customary conditions, including
title commitments, surveys and, on certain properties, environmental and site
inspections. Either party has the right to terminate the Agreement if a
threshold number of stores, or mix of locations, is not met. The Agreement also
contains customary non-solicitation provisions. The closing is scheduled to
occur on April 30, 2007.
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
REX STORES CORPORATION
Date: February 13, 2007 By: /s/ DOUGLAS L. BRUGGEMAN
------------------------
Name: Douglas L. Bruggeman
Title: Vice President-Finance,
Chief Financial Officer
and Treasurer
3