Rocky Brands (RCKY) as of March 31, 2026 shows a negative liquidation recovery to equity under the standard haircut framework. Total reported assets of $477.2M carry heavily to intangibles and goodwill, which receive zero recovery in liquidation. Applying standard haircuts: cash at 100% yields $1.7M; AR ($81.6M gross, $0.8M allowance) at 92.5% yields ~$75.3M; inventory ($172.6M) at 60% yields ~$103.6M; PP&E ($50.2M net) at 60% yields ~$30.1M; intangible assets net ($102.3M) and goodwill ($47.8M) at 0% yield nothing. Total gross tangible asset recoveries approximate $215M. Against this sits total liabilities at face value of $224.6M, producing a negative liquidation recovery of approximately negative $10M before any wind-down costs, lease termination penalties, or production commitment settlements. This aligns directionally with the MFFAIS-provided Cash Liquidation Value of negative $209.8M (which applies a stricter cash-and-AR-only lens) and Operating Liquidation Value of positive $44.5M (which includes PP&E and tangible assets more broadly). The dominant driver of negative recovery is the $150.2M in intangible assets and goodwill ($47.8M goodwill + $102.3M intangibles net) that evaporate in liquidation. Total debt at face value is $123.8M ($24.7M term loan + $99.1M ABL revolver), maturing predominantly in 2029 with $98.7M due in that year alone. The ABL is collateralized by a first lien on substantially all domestic assets, meaning secured creditors would absorb the liquidating inventory and AR proceeds ahead of equity. Compared to December 31, 2025 (prior filing, the 10-K), the period shows modest debt paydown ($124.4M to $123.8M face value) and inventory decline ($172.6M vs. $175.4M implied by MD&A commentary on 1.6% decrease). The key new disclosure this quarter is the tariff environment: RCKY paid approximately $20.5M in IEEPA tariffs that the company believes may be refundable following Supreme Court invalidation; these are not recorded as a receivable due to uncertainty. Additionally, accrued tariffs and duties declined sharply from $15.3M at December 31, 2025 to $8.7M at March 31, 2026, reflecting tariff payment timing. New operating lease ROU assets obtained in Q1 2026 totaled $4.7M, a material step-up versus $57K in the prior-year quarter, modestly adding to the operating lease liability stack ($8.3M total current and noncurrent). The filing also discloses a separate $7.9M potential refund from a pre-existing HTS code misclassification gain contingency (not booked), of which $5.1M has been collected to date. Neither the IEEPA refund nor the HTS contingency is on the balance sheet.
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