New York, New York (July 31, 2001)—Movie Star, Inc., (AMEX:MSI) today announced that it has refinanced its subordinated debt and senior notes with a three-year revolving credit facility at the prime interest rate, currently 6.75%. The new $30 million credit facility was negotiated with the company’s current lender, the banking firm of Rosenthal & Rosenthal, Inc. The proceeds from borrowings under the new credit facility will replace Movie Star's existing $18 million credit facility and be used to repay the remaining balance on the company’s 12.875% subordinated debt of $4,180,000 and 8% senior notes of $2,283,000.
“We are pleased that we were able to replace our outstanding subordinated debt and senior notes at much more favorable rates with our existing short term lender and without the expense of engaging costly outside consultants," said Thomas Rende, Movie Star’s Chief Financial Officer. "This new credit facility which significantly reduces our interest costs, provides funding necessary for working capital, letters of credit and other operating needs and eliminates any concern about principal payments on the subordinated debt and senior notes that are coming due in September and October. Now that our debt has been refinanced we can devote our full attention entirely to growing our business and improving our operating results."
The company also announced Michael A. Salberg, has been appointed as a director of the company and will serve on the audit committee of the board. The addition of Mr. Salberg fills a vacancy on the board and brings the company’s board membership to its full complement of six directors. Mr. Salberg has practiced law for the past twenty-four years and he is currently a partner in the New York law firm of Graubard Miller. The Graubard Miller firm and its predecessors have represented the company as its legal counsel for many years.
“We are very pleased to welcome Mr. Salberg to our board," said Mark M. David, Chairman of the Board. "He has been of great service to us as our outside legal counsel, and we look forward to having the benefit of his judgment as a member of our board of directors."
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; foreign government regulations; fluctuations in foreign rates;
rising costs for raw materials and the unavailability of sources of supply; the
timing of orders booked; and the risk factors listed from time to time in the
Company’s SEC reports.
MOVIE
STAR, INC. produces and sells ladies sleepwear, robes, leisurewear, loungewear,
panties and daywear.
CONTACT: INVESTOR RELATIONS:
Movie Star, Inc. -or- SM Berger & Company Inc.
Thomas Rende, CFO
Steve Warcholak
(212) 684-3400 (216) 464-6400