Former Aeropostale Inc. chairman and chief executive officer Julian Geiger has rejoined the teen retailer’s board.
The move is in connection with the chain’s closing of a $150 million credit facility with affiliates of private equity firm Sycamore Partners.
The senior secured credit facility, first disclosed on March 13, consists of a five-year $100 million term loan facility and a ten-year $50 million term loan that includes a sourcing arrangement with MGF Sourcing, also an affiliate of Sycamore. Aeropostale has committed to complete minimum purchases each year for ten years. As the teen retailer fulfills its minimum purchases, all amortization payments of the associated term loan will be fully rebated.
In turn, Aeropostale has issued convertible preferred stock to the private equity firm, giving it the right to acquire up to 5 percent of the teen retailer’s common stock at an exercise price of $7.25.
In addition to Geiger, the teen retailer has added as a new board member Stefan Kaluzny, managing director at Sycamore. The company’s board will also nominate Kenneth Gilman, a director at Zale Corp. and Kate Spade & Co. for election at the annual stockholder meeting this year. Arthur Rubinfeld is stepping down as a director of the company.