Cherokee Inc. Signs Licensing Agreement for Its Sideout Brand for China.

Business Editors

VAN NUYS, Calif.--(BUSINESS WIRE)--Dec. 12, 2002

Cherokee Inc. (NASDAQ: CHKE) announced today that is has signed an international licensing agreement for its Sideout brand with Shanghai Bolderway, Fashions Co. Inc., a division of Guangdong Leaderway, a leading marketer and retailer in China, with a portfolio of licensed American brands.

Bolderway and Leaderway are subsidiary companies of The Poly Group, a registered Chinese company dealing in international trade, real estate development, property management and investment.

This multi-year agreement covers a wide range of categories including men's, women's, children's apparel, accessories and more. It marks Cherokee Inc.'s first licensing agreement in China for its Sideout brand. Over the term of the agreement, Bolderway will open a minimum of 150 locations, both company owned and franchised.

"We are pleased to announce our new partnership with Bolderway and the opportunity we have to establish a very important base in Asia," said Michael Choe, Director of New Business. "We are now expanding our successful licensing strategies globally and expect further growth for the Sideout brand in Asia. Currently, there are several companies who have expressed strong interest in our model."

"The Sideout brand should add major growth to our existing stable of US licensed brands. Sideout, a true California casual lifestyle brand is expected to become a huge success in China as our customers are constantly seeking more US branded products with this type of authentic look and feel," said Zhang Yong Li, President of Shanghai Bolderway.

"We are very pleased and excited to have Bolderway as a partner for Sideout in China," said Larry Sass, Cherokee's Vice President of Business Development. "With their strong merchandising and retailing understanding, the Sideout brand will now be able to expand its strong heritage as a casual lifestyle brand through Bolderway's reach and expertise in China." "In addition, we continue to pursue new agreements and anticipate further growth for Sideout, Cherokee and other various brands that we represent," Sass concluded.

About Cherokee Inc.

Cherokee Inc. (NASDAQ: CHKE) is a leading global licensing and brand management firm receiving royalties on sales of $3 billion annually, through our Retail Direct Licensing template. Cherokee started out as a shoe and apparel manufacturing company in the 70's. The company reinvented itself in 1995, taking advantage of its unique position and industry-wide relationships to completely transform its business model by creating innovative licensing strategies and business synergies.

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 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 single licensee for most of the Company's revenues, the Company's dependence on its key management personnel, and adverse determinations of claims, liabilities or litigations and the effect of a breach or termination by the Company of the management agreement with the Company's CEO. A further list and description of these risk, uncertainties and other matters can be found in the Company's Annual Report on Form 10-K for Fiscal year 2002, 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.