Rocky Mountain Chocolate Factory Announces $6.6 Million Sale-Leaseback of Durango Property

The transaction received approval from the Audit Committee and disinterested directors, with the purchase price supported by an independent appraisal.

Rhea-AI Summary

Rocky Mountain Chocolate Factory (RMCF) has signed a $6.6 million sale-leaseback agreement with American Heritage Legacies for its Durango property.

The buyer is controlled by the family of Interim CEO Allen Harper, making this a related-party transaction. The company expects to use net proceeds to repay its existing $6.6 million promissory note, which carries 12% annual interest. The lease has an initial 10-year term and an option to renew for another 10 years. First-year annual rent is $624,000, representing 9.45% of the purchase price, with 2% annual increases. The lease will allow continued use of the property as the company's headquarters, production and warehouse facility.

3 points · 1 major

PositiveiHow this balance works

How this balance works

Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.

It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.

Rhea-AI Sentiment measures something else, the tone of the wording.

How the balance worksHow Sentiment works

0 major · 2 points

Hollow bars mark forward-looking points. How the balance works

Positive

• Major point$6.6 million sale-leaseback agreement signed with American Heritage Legacies provides for property sale proceeds. 80% of market cap
• Minor point. Forward-looking: it has not happened yet and may not happen.Net proceeds are expected to repay the existing $6.6 million promissory note carrying 12% annual interest.
• Minor pointContinued facility use secured under the lease, with an option to renew for an additional 10 years.

Negative

• Moderate point. Forward-looking: it has not happened yet and may not happen.10-year initial lease creates a rental obligation, with first-year annual rent of $624,000.
• Minor point. Forward-looking: it has not happened yet and may not happen.2% annual rent increases raise the lease's rental obligation over time.

News Explained

The company says its Audit Committee and disinterested directors approved the related-party sale-leaseback, with Interim CEO Allen Harper recused; it also says an independent appraisal supported the purchase price.

Key Figures

Sale-leaseback purchase price: $6.6 million Promissory note repayment: $6.6 million Note interest rate: 12% per annum +4 more

Sale-leaseback purchase price

$6.6 million

Durango property transaction

Promissory note repayment

$6.6 million

Company expects to use net proceeds to repay the existing note

Note interest rate

12% per annum

Existing promissory note

Initial lease term

10 years

Option to renew for an additional 10 years

First-year annual rent

$624,000

Lease of the Durango property

Rent as share of purchase price

9.45%

First-year annual rent

Annual rent increase

2% annually

Lease rent escalation

Key Terms

sale-leaseback, related party transaction, promissory note

3 terms

sale-leaseback financial

"signed a $6.6 million sale-leaseback agreement"

A sale-leaseback is a deal where an owner sells an asset—commonly real estate or equipment—to another party and immediately rents it back so they can keep using it. For investors, it matters because the seller converts a fixed asset into cash without disrupting operations, which can boost liquidity or pay down debt but also creates ongoing lease payments and long-term obligations that affect cash flow and the balance sheet.

related party transaction financial

"transaction constitutes a “related party transaction”"

A related party transaction is any deal or transfer of value between a company and people or entities with close ties to it — such as executives, major owners, family members, or affiliated businesses. Investors watch these transactions because they can favor insiders over outside shareholders, skirt fair market pricing, or hide risks; like selling your car to a relative at a friendly price, they require clear disclosure and scrutiny to judge impact on value.

promissory note financial

"repay its existing $6.6 million promissory note"

A promissory note is a written IOU in which one party promises to pay a specific sum, often with interest, to another party by a set date or on demand. Investors care because it functions like a loan: it creates a legal claim on future cash flows, carries credit and timing risk, and can affect valuation or liquidity—think of it as a formal, tradable promise to be repaid that can be assessed like any other debt investment.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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DURANGO, Colo., Oct. 06, 2026 (GLOBE NEWSWIRE) -- Rocky Mountain Chocolate Factory, Inc. (Nasdaq: RMCF) (the “Company” or “RMCF”), America’s Chocolatier^® since 1981, today announced it has signed a $6.6 million sale-leaseback agreement with American Heritage Legacies, LLC, involving its Durango, Colorado property. American Heritage Legacies, LLC, is a local company controlled by the family of Allen Harper, the Company’s Interim Chief Executive Officer. As such, the sale-leaseback transaction constitutes a “related party transaction” for the Company.

The Company expects to use the net proceeds from the transaction to repay its existing $6.6 million promissory note, which accrues interest at a rate of 12% per annum. The lease has an initial term of 10 years, with an option to renew for an additional 10 years. Annual rent will be $624,000 during the first year, representing 9.45% of the $6.6 million purchase price, and will increase by 2% annually. The lease will allow the Company to continue using the Durango facility as its corporate headquarters and production and warehouse facility.

“We are focused on making thoughtful financial decisions that strengthen Rocky Mountain Chocolate Factory and create a more sustainable foundation for the business,” said Mel Keating, Chairman of the Board of Directors of Rocky Mountain Chocolate Factory. “This transaction allows us to significantly reduce our existing debt while securing our continued operations at the Durango facility under a long-term lease.”

The transaction was reviewed and approved by the Company’s Audit Committee and the disinterested members of the Board of Directors, with Mr. Harper recusing himself from the review process. The purchase price was supported by an independent appraisal of the property.

About Rocky Mountain Chocolate Factory, Inc.
Rocky Mountain Chocolate Factory, Inc. is a leading franchisor, manufacturer and retailer of premium chocolates and other confectionery products. As America’s Chocolatier^® since 1981, the Company produces an extensive assortment of premium chocolates, gourmet caramel apples and other handcrafted confections. Headquartered in Durango, Colorado, Rocky Mountain Chocolate Factory is ranked among Entrepreneur’s Franchise 500^® for 2026. Together with its franchisees and licensees, the Company operates approximately 250 Rocky Mountain Chocolate Factory locations across the United States and internationally. The Company’s common stock is listed on the Nasdaq Global Market under the symbol “RMCF.”

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company’s anticipated use of proceeds and repayment of the promissory note, expected benefits of the transaction, anticipated interest expense savings, financial position, operating performance, strategic priorities and future growth. These forward-looking statements are based on current expectations and assumptions and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied. These risks and uncertainties include, among others, the Company’s financial condition and operating results, and other risks described in the Company’s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. The Company undertakes no obligation to update any forward-looking statements except as required by applicable law.

Investor Contact
Sean Mansouri, CFA
Elevate IR
(720) 330-2829
RMCF@elevate-ir.com

Media Contact
Raymond Barrett
Director of Marketing
(305) 801-5641
rbarrett@rmcf.net

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What are the terms of Rocky Mountain Chocolate Factory's Durango sale-leaseback?

The agreement sets a $6.6 million purchase price and an initial 10-year lease, with an option to renew for another 10 years. First-year annual rent is $624,000, representing 9.45% of the purchase price, and increases by 2% annually.

How was Rocky Mountain Chocolate Factory's related-party sale-leaseback reviewed?

The transaction was reviewed and approved by the Audit Committee and disinterested Board members, with Interim CEO Allen Harper recusing himself from the review process. An independent property appraisal supported the purchase price. The buyer is controlled by Harper's family.