Rocky Mountain Chocolate Factory, Inc. (RMCF) has entered into a sale-leaseback agreement for its corporate headquarters and production facility in Durango, Colorado. The transaction, approved by the company's Board of Directors and Audit Committee, involves the sale of the property at 265 Turner Drive to American Heritage Legacies, LLC (AHL).
Under the terms of the Contract to Buy and Sell Real Estate signed on September 30, 2026, RMCF will sell the Durango Property to AHL for $6.6 million. The purchase price was supported by an independent appraisal of the property. AHL is a local company controlled by the family of Allen Harper, the Company’s Interim Chief Executive Officer, making the transaction a related party transaction.
Simultaneously, RMCF has executed a Commercial Lease with AHL to continue operating the facility. The lease commences upon the closing of the sale, expected on or about October 15, 2026. The initial term is ten years, with an option to renew for an additional ten years. The annual base rent is set at $624,000 for the first year, representing 9.45% of the purchase price, and will increase by 2% annually thereafter.
RMCF intends to use the net proceeds from the sale to repay an aggregate of $6.6 million in outstanding promissory notes. These notes are owed to RMC Credit Facility LLC and RMCF2 Credit, LLC, and accrue interest at a rate of 12% per annum. The company will continue to pay all costs associated with owning, operating, and maintaining the property. The Durango facility will continue to serve as RMCF’s corporate headquarters and production and warehouse facility.
The transaction was reviewed and approved by the disinterested members of the Board and the Audit Committee. Allen Harper recused himself from the review process due to his affiliation with AHL.
