DENVER (AP) _ Ultimate Electronics Inc. on Wednesday replaced its CEO with new board chairman Mark Wattles as the consumer electronics retailer reorganizes under bankruptcy protection.
Two other executives also left the company and seven executives who previously have worked with Wattles were hired, including some from the Hollywood Video chain.
Ultimate Electronics also said it is unlikely a reorganization would result in value for common stock holders but the business would remain in operation with additional capital.
Wattles, who resigned this month as chairman of Hollywood Entertainment, blamed Ultimate Electronics' difficulties in part on aggressive growth strategies.
``The reorganization will give us the opportunity to fix the company's financial and operational structure,'' he said in a statement.
Shares of the company's stock dropped 70 cents to $1.26 in midday trading on the Nasdaq stock exchange.
Ultimate Electronics filed for Chapter 11 bankruptcy protection on Jan. 11. It has secured up to $118.5 million in debtor-in-possession financing. Wattles has given the company $5.6 million of the financing and purchased $4.4 million in stock.
The departing executives are Dave Workman, president and chief executive officer; Neal Bobrick, senior vice president of sales, and Gerry Demple, senior vice president of services.
Bill Besselman was appointed vice president of strategic planning and Lon Weingart will oversee company operations as a consultant. Both are former Hollywood Video executives.
The company also said sales for the quarter ending Jan. 31 declined 19.4 percent to $195.9 million, compared with $243.2 million in the same period of the previous year.
For the year, sales dropped 8 percent to about $658.3 million, compared with $712.9 million in the previous year. The company did not provide guidance on earnings because of the Chapter 11 filing.
Based in suburban Thornton, Ultimate Electronics operates stores in Arizona, Idaho, Illinois, Iowa, Kansas, Minnesota, Missouri, Nevada, New Mexico, Oklahoma, South Dakota, Texas and Utah under the Soundtrack and Ultimate Electronics names.