1115 BROADWAY
Movie
Star, Inc. Announces Record Date for $20 Million Rights Offering
Expects Special Shareholders’ Meeting to be Held in mid-January 2008
New York, New
York (November 13, 2007)—Movie
Star, Inc. (AMEX: MSI) (“Movie Star”) announced
today that the record date for determining the shareholders entitled to receive
non-transferable subscription rights to purchase additional shares of Movie
Star common stock in its previously announced rights offering has been set for November
27, 2007 (the “Record Date”). Movie Star
anticipates that the subscription period for the rights offering will begin
during the first week of December 2007 and will extend for at least 30 calendar
days. The rights offering is expected to
close concurrently with the merger of Fred Merger Corp., a wholly-owned
subsidiary of Movie Star, into FOH Holdings, Inc., the parent company of
Frederick’s of Hollywood, Inc. The
closing of the transactions contemplated by the merger agreement, including the
rights offering, is subject to the approval of the matters specified in the
preliminary proxy statement by Movie Star’s shareholders and other customary
closing conditions. The Record Date for
the rights offering also will be the record date for determining the
shareholders entitled to vote at Movie Star’s special shareholders meeting to
approve these matters. Movie Star
expects to mail the definitive proxy statement during the first week of
December 2007 and anticipates that the special meeting will be held in
mid-January 2008. The preliminary proxy
statement contains important information regarding the closing conditions and
the transactions in general.
Subject to
the registration statement for the rights offering becoming effective under the
Securities Act of 1933, as amended, each shareholder will receive one non-transferable
subscription right for each share of Movie Star common stock owned as of the
Record Date. Each non-transferable subscription
right will entitle the holder to purchase a fraction of a share of Movie Star
common stock, with the numerator of that fraction being $20,000,000 divided by
the subscription price per share (which equals the total number of shares of
Movie Star common stock to be issued in the rights offering), and the
denominator being the total number of shares of Movie Star common stock
outstanding on the Record Date. The
number of shares entitled to be purchased by each holder will be rounded down
in the aggregate to the nearest whole number.
The subscription price will equal the average of the closing prices of
Movie Star common stock for the 20 trading days immediately preceding the
Record Date, less a 15% discount.
Movie Star
shareholders who fully exercise all rights issued to them will be entitled to
subscribe for additional shares of Movie Star common stock at the subscription
price pursuant to an oversubscription privilege to the extent that other
eligible participants do not exercise their subscription privileges in
full. Fursa Alternative Strategies, LLC
(“Fursa”) and certain funds and accounts affiliated with, managed by, or over
which Fursa or any of its affiliates exercises investment authority, including,
without limitation, with respect to voting and dispositive rights, Tokarz
Investments, LLC and TTG Apparel, LLC, have agreed to act as standby purchasers
and purchase directly from Movie Star, at the same subscription price, all
shares of Movie Star common stock not subscribed for in the rights offering.
Neither Movie Star, its board of directors, nor any committee of
the board of directors
is making any recommendation to shareholders as to whether to exercise their
subscription rights to purchase shares of Movie Star common stock. A registration statement relating to these
securities has been filed with the Securities and Exchange Commission (“SEC”),
but has not yet become effective. The
non-transferable subscription rights will not be distributed and shares of
Movie Star common stock to be issued in connection with the rights offering may
not be sold and offers may not be accepted prior to the time the registration
statement becomes effective. The rights
offering will only be made by means of the prospectus, which is not yet
available. When available, a copy of the
prospectus may be obtained from Movie Star, Inc., 1115 Broadway,
This press
release shall not constitute an offer to sell or the solicitation of an offer
to buy these securities, and there shall not be any sale of these securities in
any state in which such offer, solicitation, or sale would be unlawful prior to
registration or qualification under securities laws of any such state.
MOVIE
STAR, INC. designs, manufactures (through independent contractors), imports,
markets and distributes women’s intimate apparel, including sleepwear, robes,
leisurewear and daywear, to mass merchandisers, specialty and department
stores, discount retailers, national and regional chains and direct mail
catalog marketers throughout the United States.
Current collections include the Cinema
Etoile premium line of intimate apparel and the Movie Star line of apparel sold as private label programs.
Important Additional Information Will
be Filed with the SEC
In connection with the
transactions contemplated by the merger agreement, Movie Star will file a
definitive proxy statement and a final prospectus with the SEC. BEFORE MAKING ANY INVESTMENT DECISION TO
PARTICIPATE IN THE RIGHTS OFFERING, MOVIE STAR SHAREHOLDERS ARE URGED TO READ
THE FINAL PROSPECTUS CAREFULLY IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE
BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED RIGHTS
OFFERING. BEFORE MAKING ANY VOTING
DECISION, MOVIE STAR SHAREHOLDERS ARE URGED TO READ THE DEFINITIVE PROXY
STATEMENT CAREFULLY IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE BECAUSE IT WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTIONS. Movie Star shareholders and other interested
parties will be able to obtain, without charge, a copy of the definitive proxy
statement and final prospectus (when available) and other relevant documents
filed with the SEC, from the SEC’s website at http://www.sec.gov. Movie Star shareholders and other interested
parties will also be able to obtain, without charge, a copy of the definitive
proxy statement, final prospectus and other relevant documents (when available)
by directing a request by mail or telephone to Movie Star, Inc., 1115 Broadway,
New York, NY 10010, telephone: (212) 798-4700.
Participants in the Solicitation
Movie Star and its
directors and officers may be deemed to be participants in the solicitation of
proxies from Movie Star shareholders with respect to the transactions
contemplated by the merger agreement. Information
about Movie Star’s directors and executive officers and their ownership of
Movie Star common stock is set forth in the preliminary proxy statement
referenced above and will be set forth in the definitive proxy statement. Shareholders and investors may obtain
additional information regarding the interests of Movie Star and its directors
and executive officers in the transactions contemplated by the merger
agreement, which may be different than those of Movie Star shareholders
generally, by reading the proxy statement and other relevant documents
regarding the transactions contemplated by the merger agreement that have been
or will be filed with the SEC.
Forward Looking Statement
Certain of the matters set
forth in this press release are forward-looking and involve a number of risks
and uncertainties. Among the factors
that could cause actual results to differ materially are the following:
business conditions and growth in the industry; general economic conditions;
addition or loss of significant customers; the loss of key personnel; product
development; competition; risks of doing business abroad; foreign government
regulations; fluctuations in foreign rates; rising costs for raw materials and
the unavailability of sources of supply; the timing of orders booked; failure
to realize the merger’s anticipated synergies; approval of the transactions by
Movie Star’s shareholders and satisfaction of various other conditions to the
closing of the merger contemplated by the merger agreement; and the other risks
that are described from time to time in Movie Star’s SEC reports.
CONTACT: INVESTOR RELATIONS:
Movie Star, Inc.
-or- SM Berger & Company, Inc.
Thomas Rende, CFO Stanley Berger
(212) 798-4700 (216) 464-6400