The Secaucus-based Children’s Place said it received $48.6 million from its majority shareholder, Mithaq Capital, as the second tranche of its interest-free, unsecured and subordinated term loan.
The funding was administered as laid out in a previously announced Unsecured Promissory Note, dated Feb. 29, entered into between Mithaq and the Children’s Place.
Mithaq Capital announced in early March that it was taking charge at the Children’s Place. The Riyadh-based Saudi Arabian office of the Al-Rajhi family said at that time that it would provide the retailer with a $78.6 million interest-free, unsecured and subordinated term loan to strengthen the liquidity of the the Children’s Place. Mithaq provided an initial tranche of $30 million on Feb. 29 and is has now provided the additional $48.6 million.
In addition to the funding of the second Mithaq Term Loan, resignation of certain board members was announced.
Norman Matthews, John Bachman, John Frascotti, Debby Reiner and Michael Shaffer have stepped down and the size of the board has been reduced to six. Jane Elfers will continue to serve in her role as CEO, president and director of the company. In addition, the new board has appointed Douglas Edwards — who served in a number of different roles with Wells Fargo & Co. before his retirement in 2022, including executive vice president and interim general counsel — to serve on the reconstituted board as an independent director, with immediate effect upon the completion of customary lender due diligence required by the previously announced forbearance agreement entered into by the company and the other lenders party thereto.
The company continues to expect to be in a position to close the previously announced $130 million term loan (the “Gordon Brothers Term Loan”) in March, as contemplated by the nonbinding term sheet that the company entered into with 1903P Loan Agent LLC. The company is also pursuing improved terms with Gordon Brothers as well as alternative financing on terms no less favorable in the aggregate to the company.
