Charming Charlie wins interim OK to close stores, access DIP financing

By Caroline Salls

Pittsburgh, July 12 – Charming Charlie Holdings, Inc. received interim court approval to enter into a store-closing consultant agreement and to access $13 million in debtor-in-possession financing, according to orders filed Friday with the U.S. Bankruptcy Court for the District of Delaware.

The final hearings are scheduled for Aug. 14.

The company has entered into a consulting agreement under which the contractual joint venture comprised of Hilco Merchant Resources, LLC and SB360 Capital Partners will conduct going-out-of-business sales at the Charming Charlie stores.

Charming Charlie said the store-closing sales are expected to last roughly two months and generate about $30 million in revenue.

The consultants will receive a fee equal to 1½% of the gross proceeds of the merchandise sold at the stores.

To finance the Chapter 11 cases and the store-closing sales, the company has obtained a commitment for $13 million in DIP financing from its pre-bankruptcy ABL lenders.

Specifically, Second Avenue Capital Partners, LLC is serving as co-collateral agent and a lender, and White Oak Commercial Finance, LLC as administrative agent, co-collateral agent and a lender.

The DIP facility is scheduled to mature on July 12, 2020.

Interest will accrue at Libor plus 850 basis points.

Charming Charlie is a Houston-based retailer of jewelry and accessories for women. The company filed bankruptcy on July 11 under Chapter 11 case number 19-11534.

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