Margolis to continue as Chairman of Cherokee

28 Apr '10

3 min read

Cherokee Inc., a leading licensor and global brand management company, announced that it has entered into an agreement with Chairman and CEO Robert Margolis under which, subject to shareholder approval, he will continue as Executive Chairman beginning February 1, 2011.

Russell Riopelle, CFO of Cherokee, said, "Since Robert re-joined Cherokee in 1995 and transformed the Company into a global licensor, Cherokee has experienced a tremendous turnaround and returned over $202 million to shareholders in the form of dividends and distributions, while our stock price has increased dramatically from less than $2.00 per share at that time. Robert's new agreement, beginning February 1, 2011, will also include an estimated 50%-60% reduction in his annual bonus compensation, which should result in significant cost savings to Cherokee shareholders beginning February 1, 2011. More information regarding the proposed amendment to the Company's agreement with Robert Margolis will be included in our upcoming 2010 Proxy Statement (available in early May), and will be submitted to shareholders for a vote at our 2010 annual meeting of stockholders currently scheduled for June 4, 2010 in Santa Monica, CA. We're pleased that Robert has agreed to stay on as Chairman and look forward to his continued leadership at Cherokee."

In conjunction with Mr. Margolis' planned transition from CEO & Chairman to Executive Chairman beginning February 1, 2011, Cherokee's Board of Directors will commence a process to ensure an orderly CEO succession plan. The Company expects to adopt and announce that plan prior to Mr. Margolis' becoming Executive Chairman.

In addition, Robert Margolis, Chairman and CEO, announced that Howard Siegel will be promoted to Chief Operating Officer. "As President, Howard has been an integral part of the business for fifteen years. Many of the initiatives in place are due to his strong leadership and experience. The board and I are pleased to promote Howard to Chief Operating Officer."

Howard Siegel, President and Chief Operating Officer, said, "On behalf of our entire management team, we are well served to have Robert's continued involvement, guidance, and expertise as Chairman. In addition, as part of our long term expansion plans, we are pleased to announce the following executive promotions:

• Zoe Ann Murphy - President of The Americas Region
• Mark Nawrocki - President of Europe / The Middle East Regions
• Larry Sass - President of Asia / South Africa / India Regions

This internal structure was created last fall to intensify our focus on new business while better serving the needs of our existing accounts. Since then, we have signed eight new license agreements, including RT Mart in China for our Cherokee brand, six wholesale agreements in the U.S. for our Sideout brand, and a worldwide agreement with IBB for beauty and personal care for the Laila Ali brand--validating this new structure. Each President will now have full P&L responsibilities for their respective regions. We believe these new initiatives will begin to add to our revenue and earnings growth by the fourth quarter of this year."

Cherokee Inc

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