Board authorizes 150% increase in quarterly dividend to $0.15 per share

New financing provides additional growth capital at attractive terms

bebe stores, inc. (OTCQB:BEBE) (the “Company”) today announced that it has entered into a credit agreement providing for a five-year senior secured term loan of $25 million with an additional drawdown capacity of up to $10 million from SLR Credit Solutions (formerly known as Crystal Financial). Proceeds of the financing were used to retire its existing secured term loan of $22 million and for additional growth capital purposes.

In conjunction with the financing, the Company has also announced it has agreed to purchase eight additional Buddy’s Home Furnishings rent-to-own franchises from Franchise Group, Inc. (NASDAQ: FRG). The eight franchises, located in Kentucky and Indiana, complement the Company’s existing footprint in the Southeast U.S. and leverages bebe’s existing back-office infrastructure.

In addition, its Board of Directors has authorized and declared an increase to the Company’s quarterly cash dividend on the Company’s common stock to $0.15 per share from the previous quarterly dividend of $0.06 per share implemented during the second quarter of 2020. The quarterly dividend is payable September 24, 2021, to shareholders of record as of September 10, 2021.

“This refinancing allows us to meaningfully lower our cost of capital while providing further financial flexibility to execute on our strategy to deliver future growth from our platform,” said bebe CEO, Manny Mashouf. “The increase in our quarterly dividend represents the strong operating results from our brand licensing properties and our positive outlook for the 47 Buddy’s Home Furnishings rent-to-own franchises we acquired in November 2020, in line with our stated goal of providing a strong dividend to our shareholders.”

Cheryl Carner, Senior Managing Director, Head of Originations at SLR Credit Solutions, added, “We are excited to partner with Manny and the entire bebe management team to help facilitate the growth of their business.”

Loans under the credit facility will bear interest at LIBOR (subject to a 1.00% floor) plus 5.50% with a reduction to 5.25% after one year to the extent the Company’s leverage ratio is at or less than 1.50:1.00. The credit facility will be secured by substantially all assets of the Company and its subsidiaries.

About bebe stores, inc.

bebe is a global specialty licensor of fashion apparel and accessories that distributes bebe-branded products worldwide through licensees in approximately 100 international stores and online. bebe also owns and operates, through subsidiaries, approximately 55 rent-to-own Buddy’s Home Furnishings franchise stores located in ten states in the southeastern U.S., offering furniture, appliances and electronics to consumers through rent-to-own agreements, along with other investments in brand royalty joint ventures.

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