CHEROKEE INC. (NASDAQ:CHKE) Files An 8-K Other EventsItem 8.01Other Information.
Extension of Forbearance. As previously disclosed, as of July29, 2017, the end of the Company’s most recently completed fiscal quarter, the Company was not in compliance with certain financial covenants set forth in its senior secured credit facility (the“Cerberus Credit Facility”) with Cerberus Business Finance, LLC (“Cerberus”). The Company initially obtained a forbearance from Cerberus regarding these events of default on September8, 2017, which was extended on September15, 2017, and further extended on September29, 2017. to the forbearance, as extended, Cerberus has agreed that it will not exercise its rights or remedies under the Cerberus Credit Facility solely with respect to these events of default through October13, 2017. The Company is working with Cerberus to obtain a waiver of the events of default and/or amend certain terms of the Cerberus Credit Facility during the forbearance period. However, such a waiver or amendment may not be obtained, or if obtained, may not be obtained in a timely manner, during the forbearance period or on terms favorable to the Company. Any failure to obtain such a waiver or amendment within the forbearance period would subject the Company to significant risks, including Cerberus’s right to terminate its obligations under the Cerberus Credit Facility, declare all or any portion of the borrowed amounts then outstanding to be accelerated and due and payable, and/or exercise any other rights or remedies it may have under applicable law, including foreclosing on the Company’s and/or its subsidiaries assets that serve as collateral for the borrowed amounts.