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Cherokee Inks $40 Million Term Loan

Cherokee Inks $40 Million Term Loan

Cherokee Inks $40 Million Term Loan
August 06
14:38 2018
Booking.com



Cherokee Global Brands has improved its financial flexibility through the completion of a new $40 million three-year term loan that is secured by the company’s intellectual property assets.
Cherokee will use the proceeds from the loan to refinance its existing debt and increase liquidity. The firm’s IP assets backing the term loan include the Cherokee, Hi-Tec, Magnum, Tony Hawk, Sideout and Liz Lange brands.
In connection with the refinancing, the holders of the junior participation interest in Cherokee’s former credit facility have increased their subordinated interests to $13.5 million from $2 million, and Cherokee has increased its long-term debt to $53.5 million from $45.2 million. The company said the transaction, after discounts and issuance costs, has increased the firm’s overall liquidity by $5.5 million. Further, the company has issued warrants to the senior and junior lenders, allowing them to purchase 2.8 million shares of common stock at an average exercise price of 48 cents a share.
Henry Stupp, chief executive officer of Cherokee, said, “Since the start of fiscal 2019, we have hit several benchmarks, including strengthening our management team, successfully refining our operations and divesting non-royalty businesses.”
Stupp said the more focused and efficient infrastructure will enable the company to realize the full

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