francesca’s® Announces $10 million Term Loan Agreement Completion of Strategic Alternatives Review
August 14 2019 - 7:30AM
Francesca’s Holdings Corporation (the “Company”) (Nasdaq: FRAN)
today announced that it has entered into a second lien term loan
Credit Agreement (“Term Loan Credit Agreement”) with Tiger Finance,
LLC. The Company simultaneously announced the completion of its
previously announced strategic alternatives review. Following
a thorough review process, the board of directors has concluded
that the Company will best serve the interests of its stockholders
at this time by focusing on the continued execution of its
turnaround plan.
Michael Prendergast, Interim CEO, stated, “We
are pleased to have closed the term loan agreement as it provides
additional financial flexibility to our organization as we continue
to advance our strategic initiatives. We believe that the
additional liquidity provided by the term loan agreement, in
combination with previously announced cost savings and operating
initiatives, will allow the Company additional cushion as it
implements its turnaround plan, and represents a vote of confidence
in the Company’s turnaround efforts.”
“We are pleased to provide additional liquidity
at this important point in francesca’s evolution,” said Robert
DeAngelis, Executive Managing Director of Tiger Finance, LLC.
“This term loan facility is one example of how Tiger partners with
our clients to help them achieve long-term sustainable growth.”
The Term Loan Credit Agreement provides for an
aggregate term loan of $10.0 million and matures on August 13,
2022. The Term Loan Credit Agreement is subject to a combined
borrowing base together with the Company’s existing asset based
revolving credit facility. This combined borrowing base, after
taking into account the Term Loan Credit Agreement, is expected to
provide approximately $7.0 million of net additional liquidity to
the Company.
The Term Loan Credit Agreement contains
customary affirmative and negative covenants, including
limitations, subject to customary exceptions in addition to
limitations on the amount of capital expenditures that francesca’s
is permitted to make through the fiscal year ending in 2021,
provided that the loan parties may make unlimited amounts of
capital expenditures if certain payment conditions are met. Further
details about the Term Loan Credit Agreement will be contained in a
Current Report on Form 8-K to be filed by the Company with the U.S.
Securities and Exchange Commission (“SEC”).
Concurrently with the Term Loan Credit
Agreement, the Company obtained an amendment from the lenders under
its existing asset based revolving credit facility to permit the
new financing.
About Francesca's Holdings Corporation
francesca's® is a specialty retailer which
operates a nationwide-chain of boutiques providing customers a
unique, fun and personalized shopping experience. The merchandise
assortment is a diverse and balanced mix of apparel, jewelry,
accessories and gifts. As of August 13, 2019, francesca's® operated
approximately 718 boutiques in 47 states throughout the United
States and the District of Columbia and also serves its customers
through francescas.com. For additional information on francesca's®,
please visit www.francescas.com.
About Tiger Financial, LLC
Tiger Financial, LLC is an affiliate of Tiger
Capital Group, LLC. Based in New York, Tiger provides asset
valuation, advisory and disposition services to a broad range of
retail, wholesale, and industrial clients. Tiger helps clients
identify the underlying value of assets, monitor asset risk factors
and, when needed, provides capital quickly and decisively. Tiger
maintains domestic offices in New York, Los Angeles, Boston,
Chicago, Houston and Toronto.
Forward-Looking Statements
Certain statements in this release are
“forward-looking statements” made pursuant to the safe-harbor
provisions of the Private Securities Litigation Reform Act of 1995,
as amended. Such forward-looking statements reflect the Company’s
current expectations or beliefs concerning future events and are
subject to various risks and uncertainties that may cause actual
results to differ materially from those that are expected. These
risks and uncertainties include, but are not limited to, the
following: the risk that the Company may not be able to
successfully execute its turnaround plan; the risk that the Company
may not be able to successfully integrate its Interim Chief
Executive Officer and Chief Financial Officer, and attract and
integrate a new Chief Executive Officer; the risk that the Company
cannot anticipate, identify and respond quickly to changing fashion
trends and customer preferences or changes in consumer environment,
including changing expectations of service and experience in
boutiques and online, and evolve its business model; the Company’s
ability to attract a sufficient number of customers to its
boutiques or sell sufficient quantities of its merchandise through
its ecommerce website; the Company’s ability to successfully open,
close, refresh, and operate our boutiques each year; the Company’s
ability to efficiently source and distribute merchandise quantities
necessary to support its operations; and the impact of potential
tariff increases or new tariffs. For additional information
regarding these and other risks and uncertainties that could cause
actual results to differ materially from those contained in the
Company’s forward-looking statements, please refer to “Risk
Factors” in the Company’s Annual Report on Form 10-K for the year
ended February 3, 2019 filed with the SEC
on May 3, 2019 and any risk factors contained in
subsequent quarterly and annual reports it files with the SEC.
The Company undertakes no obligation to publicly update or revise
any forward-looking statement.
CONTACT:
ICR, Inc.Jean
Fontana646-277-1214 |
CompanyCindy
Thomassee 832-494-2240Kate Venturina 713-864-1358 ext.
1145ir@francescas.com |
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