11:23 AM EDT, 10/21/2024 (MT Newswires) -- Kirkland's (KIRK) and Beyond (BYON) said Monday they have formed a partnership under which Beyond will invest $25 million in Kirkland's in a combined debt and equity transaction.

Kirkland's entered into a $17 million term loan credit agreement with Beyond, of which $8.5 million comprises of a convertible note that will convert into Kirkland's shares at $1.85 apiece. The parties also signed an agreement under which Beyond will buy an additional $8 million of Kirkland's shares at the same price, the companies said.

The companies also signed a seven-year collaboration agreement allowing Beyond to earn a collaboration fee equal to 0.25% of Kirkland's quarterly retail and e-commerce revenue beginning in Kirkland's first Q1 2025 and an incentive fee equal to 1.5% of Kirkland's incremental growth in e-commerce revenue during the deal's term.

Following the closing of the stock purchase under the subscription agreement, Beyond will have a right to nominate two directors to Kirkland's board.

Under the terms of the partnership, Kirkland's will become Beyond's brick-and-mortar operator and licensee for new, smaller format neighborhood Bed Bath & Beyond locations in the US. Beyond will support Kirkland's digital transformation, they said.

Kirkland's shares were up over 11% in recent trading, while Beyond was 0.9% lower.

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