K-Swiss Moves to Larger Facility in Chatsworth

K-Swiss Inc., the sneaker maker long based in Pacoima, has moved its headquarters to bigger facilities in Chatsworth. The company also said last week that it restructured its long-term debt by paying off a $10-million note, tapping into a credit line with a much lower interest rate.

Prepayment of the note to John Hancock, which was due in 1995 and had an annual interest rate of 13.7%, will enable K-Swiss to save more than $1.6 million in interest expenses, K-Swiss said. However, K-Swiss said it faced a prepayment penalty of $896,000, which will be recorded as an extraordinary after-tax charge to its fourth quarter.

In refinancing the loan, the company tapped funds from a $50-million credit line with an interest rate of about 6%. George Powlick, K-Swiss’ chief financial officer, said the company now had less than $1 million in long-term debt.

Powlick said K-Swiss moved to new rental offices because it outgrew its company-owned building in Pacoima, which is now for sale or lease. With 27,000 square feet of space, the new headquarters has 50% more office space.