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Nasir and Matt discuss the bankruptcy auction of Radio Shack and why the intangible assets are being sold separately from the tangible assets. Full Podcast Transcript NASIR: All right. Welcome to our business law podcast where we cover business in the news and add our legal twist. My name is Nasir Pasha. MATT: And I’m Matt— NASIR: The co-host of the show and… MATT: And I’m— NASIR: We have another co-host as well. MATT: Gosh. NASIR: And you are… MATT: Matt Staub. NASIR: Oh, Matt Staub, that’s right. MATT: You’re in like a pitch black environment so I can’t see when you’re speaking. Recording in darkness. NASIR: I’m sorry. MATT: You’d think we would have gotten it down by now, but I guess not, never will. NASIR: Someday, we’ll be jiving together, working with each other well. MATT: Yeah. NASIR: Someday. MATT: So, I feel like I just talked about this on the podcast so forgive me, listeners, if I did. But the spot that I usually go to to fill up my gas is right across the street from a RadioShack and I think it’s pretty funny because I thought all the RadioShacks were shut down and that’s, I guess, what we’re talking about today and, regardless of whether the store is doing well – which it isn’t – I recognize the name is a very important name and that’s kind of what’s going on in this bankruptcy auction. They’re segregating the company name and intellectual property. Are they going to sell it off separately from everything else? Stuff like the store leases, et cetera. They expect to get $20 million for it – which, you know, at its prime, RadioShack was worth well over that. But, you know, after they sell that name and the IP, I guess you have your inventory but it’s probably a pretty undesirable leftover of assets, especially those leases. NASIR: Yeah. Let’s say, first of all, the bids start at $20 million, right? So, let’s say that you’re a company and you buy RadioShack, the name, for $20 million plus, what are you going to do with that thing? I mean, that’s going to be hard to get your money back, I feel. MATT: Commercial lease is expensive. That’s the way it is and these RadioShacks are going to be fairly good-sized stores, you know. It’s a lot of… NASIR: Hold on. The name RadioShack is being sold for $20 million. There’s about 1,100 RadioShack leases that are put on sale which seems strange, right? Okay. How can you sell a lease? But, basically, they’re selling the right to assume the lease because that’s a lot, you know, a thousand other leases. That’s a lot of property and being able to get in there by getting that lease assumed might be a good location and so forth. MATT: Oh, okay. NASIR: And they may have negotiated some pretty good leases. See, it’s actually separate. MATT: Oh, sorry. I heard you talking about something. I just assumed you were talking about the leases. NASIR: Oh. Actually, I assume the same thing. Every time you talk, I just assume you’re talking about leases. MATT: So, this is a pretty interesting arrangement. We’ve definitely talked about this before how, when you purchase a business, there’s different ways you can do it. I mean, you can purchase – what is it? Is RadioShack a corporation, I would guess? NASIR: It’s a corp, Delaware. MATT: You know, you can purchase the stock, you can purchase the assets. There’s different ways of going. When you buy a “business,” there’s different ways of going about it. So, regardless of whether there are value in some of these spaces that they’ve leased out, I mean, I think RadioShack does say, “Hey, you know, our value is in this name,” and, rolling back to my story, you know, I agree with it. I saw the name RadioShack and it still means something to me. Like, I know what that is. I mean, I would never probably go there because I would shop online. But it’s not a shock to people that brand names can have significant value. NASIR: See, that’s what’s weird is that, once someone buys that name, they won’t be RadioShack.