Bakers Footwear Group issued 350,000 shares of common stock and entered into a $7.5 million subordinated secured term loan with Private Equity Management Group (PEMG) and an entity affiliated with PEMG. Bakers received net proceeds of about $6.7 million after transaction fees and expenses.
The loan has an interest rate of 15 percent per year, with principal and interest payable monthly from March 2008 through February 2011. PEMG received the 350,000 shares of Bakers' common stock as additional consideration in connection with the loan.
“We are pleased to complete this equity and debt transaction, which provides us with additional liquidity to execute our turnaround plan,” Peter Edison, chairman, CEO and president of the St. Loius-based Bakers, said in a statement. “Importantly, this financing marks a tremendous vote of confidence in Bakers — our store format, our strategy and operating platform.”
