SHERMAN OAKS, Calif., Jan. 31, 2019 (GLOBE NEWSWIRE) -- Cherokee Global Brands (CHKE), a global brand marketing platform that manages a growing portfolio of fashion and lifestyle brands, today announced its amended credit facility.
On January 30, 2019, Cherokee entered into a second amendment to its senior secured credit facility with Gordon Brothers Finance Company to borrow an additional $5.3 million under the senior secured credit facility. A portion of the net proceeds were used to repay the $2.0 of subordinated notes that the Company entered into on December 28, 2018, and the balance will be used for general working capital purposes. With the amendment, the senior secured credit facility no longer requires that the Company raise $2.0 million of additional capital. Furthermore, this new amendment reduces from $6.0 million to $1.0 million the allowable level of junior capital the Company can raise to support operations.
“We are pleased to enter into our amended agreement with Gordon Brothers, which improves our financial flexibility and positions us to execute our strategic plan with sufficient liquidity,” commented Henry Stupp, Chief Executive Officer. “This marks an important next step towards stabilizing the Company, while supporting our global licensing partners and stakeholders. We want to thank Gordon Brothers, who have proved a strategic, like-minded investor, for their continued support and partnership.”
Mr. Stupp concluded, “We entered Fiscal 2019 with aggressive goals; namely, complete the integration of Hi-Tec, right size our operational structure, focus and align our brands, and place the Company back on solid financial footing. We are pleased to have achieved these objectives. Through the actions taken over the past several quarters, we are better positioned to realize the full potential of all brands in our portfolio with our strong leadership and best-in-class licensees and retail partners. Looking forward, our team is focused on growing our global retail distribution across the portfolio of brands we own, brands we develop and brands we create through new product introductions and expanded marketing activities.”
About Cherokee Global Brands
Cherokee Global Brands is a global brand marketing organization that manages a growing portfolio of fashion and lifestyle brands including Cherokee®, TONY HAWK® Signature Apparel and Hawk Brands®, Liz Lange®, Everyday California®, Sideout®, Hi-Tec®, Magnum®, 50 Peaks® and Interceptor® across multiple consumer product categories and retail tiers around the world.
The Company currently maintains license and franchise agreements with leading retailers and manufacturers that span over 110 countries in 12,000 retail locations and digital commerce.
Safe Harbor Statement
This news release may contain forward-looking statements regarding future events and the future performance of Cherokee Global Brands. Forward-looking statements in this press release include, without limitation, express or implied statements regarding: anticipated market developments and opportunities; anticipated growth in the Company’s business; anticipated benefits of the amended credit facility; and anticipated effects of the liquidity infusion. A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances and is based on currently available market, operating, financial and competitive information and assumptions. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expected or projected, including, among others, risks that: the Company and its partners will not achieve the results anticipated in the statements made in this release; global economic conditions and the financial condition of the apparel and retail industry and/or adverse changes in licensee or consumer acceptance of products bearing the Company’s brands may lead to reduced royalties; the ability and/or commitment of the Company’s licensees to design, manufacture and market Cherokee®, Hi-Tec®, Magnum®, 50 Peaks®, Interceptor®, Carole Little®, Tony Hawk® and Hawk Brands®, Liz Lange®, Everyday California® and Sideout® branded products could cause our results to differ from our anticipations; the Company’s dependence on a select group of licensees for most of the Company’s revenues makes us susceptible to changes in those organizations; and the Company’s dependence on its key management personnel could leave us exposed to disruption on any termination of service. A more detailed discussion of such risks and uncertainties are described in the Company’s annual report on Form 10-K filed on April 19, 2018, its periodic reports on Forms 10-Q and 8-K, and subsequent filings with the SEC the Company makes from time to time. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Cherokee Global Brands
Steve Brink, CFO
Addo Investor Relations
Laura Bainbridge/Patricia Nir