Cherokee Inc. Enters into an International Licensing Agreement with S. A. C. I. Falabella for Its Cherokee Brand

Business Wire, Jan 9, 2007

VAN NUYS, Calif. -- Cherokee Inc. (NASDAQ:CHKE) announced today that it has entered into an international licensing agreement for its Cherokee brand with S.A.C.I. Falabella, the premier retailer in Chile and owner of its Tottus Hypermarket Stores. This multi-year agreement covers a wide range of categories including men's, women's, children's clothing, footwear, accessories and more.

"As one of the only true global family lifestyle brands that cover a wide range of product categories, the Cherokee brand will add significant growth and profit to our apparel and non-foods business and will translate well into the South American market. Our customers are looking for more branded products and now with Cherokee, we will be able to satisfy their needs with style, quality, and value," said Juan Benavides FeliA, CEO of Falabella.

"We are pleased to announce our new partnership with Falabella and its Tottus Hypermarkets. This partnership will provide us with the opportunity to establish an important platform for distribution in South America," said Mark Nawrocki, Senior Vice President of Marketing, Cherokee Inc. "Cherokee's 34-year heritage coupled with Falabella's strong merchandising, marketing and advertising expertise, as well as its unique position in the Chilean market, creates an ideal opportunity for Cherokee in Chile."

"We are proud to say that the Cherokee brand will now have a sizeable presence in 20 countries around the world. In addition to Pick 'n Pay in South Africa and Fawaz Al Hokair throughout the Middle East, Falabella represents the third new international licensing agreement in the last twelve months. Along with continued development with our existing partners, these new partners will continue to reinforce our 'world branding' strategies for the Cherokee brand and will strengthen our platform for future growth around the world. In the coming months, we will continue to pursue these strategies as we meet with premier retailers in available countries throughout Latin America, Europe and Asia. With annual retail sales approaching $3.0 billion, Cherokee is arguably one of the fastest growing family lifestyle brands globally," stated Larry Sass, Senior Vice President, Cherokee Inc.

About Cherokee Inc.

Cherokee Inc., based in Van Nuys, is a marketer, licensor and manager of a variety of brands it owns (Cherokee, Sideout, Carole Little and others) and a consultant to brands it represents. Currently, Cherokee Inc. has licensing agreements in a number of categories, including family apparel, fashion accessories and footwear, as well as home furnishings and recreational products. Premier clients for Cherokee Inc. include Target Stores, TJX Companies, Mervyn's, Tesco, Hbc/Zellers, Pick 'n Pay, Grupo Aviara, Fawaz Al Hokair, and Shanghai Bolderway.

Statements included within this news release that are not historical in nature constitute forward-looking statements for the purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. When used, the words "anticipates," "believes," "expects," "may," "should" and similar expressions are intended to identify such forward-looking statements. Forward-looking statements included in this press release (including, without limitation, express or implied statements regarding future revenue and net income growth involve known and unknown risk and uncertainties that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such risks and uncertainties, include, but are not limited to, the effect of national and regional economic conditions, the financial condition of the apparel industry and the retail industry, the overall level of consumer spending, the effect of intense competition in the industry in which the Company operates, adverse changes in licensee or consumer acceptance of products bearing the Company's brands as a result of fashion trends or otherwise, the ability and/or commitment of the Company's licensees to design, manufacture and market Cherokee and Sideout branded products, the Company's dependence on a select group of licensees for most of the Company's revenues, the Company's dependence on its key management personnel, and adverse determinations of claims, liabilities or litigations. A further list and description of these risk, uncertainties and other matters can be found in the Company's Annual Report on Forms 10-K for Fiscal Year 2006, and in its periodic reports on Forms 10-Q and 8-K (if any). Undue reliance should not be placed on the forward-looking statements contained herein because some or all of them may turn out to be wrong. The Company disclaims any intent or obligation to update any of the forward-looking statements contained herein to reflect future events and developments.