Frederick’s of Hollywood plans to go private

Hollywood, Calif. -- Frederick's of Hollywood Group Inc. has entered into a definitive merger agreement that provides for the acquisition of the company by a consortium consisting of HGI Funding LLC, a wholly-owned subsidiary of Harbinger Group Inc., and certain of the company's other common and preferred shareholders. The members of the consortium as a group beneficially own approximately 88.6% of the company's common stock.

The acquisition will be accomplished through FOHG Holdings, LLC, an entity controlled by the consortium that was formed for the purpose of the transaction. Under the merger agreement, the company's shareholders who are not members of the consortium will receive $0.27 per share in cash upon completion of the transaction.

In addition, in connection with the execution of the merger agreement, Frederick’s and Holdings entered into a new employment agreement with Thomas Lynch, CEO, which will take effect only upon the consummation of the merger. Under the new employment agreement, Lynch agreed to continue to serve as CEO for three years following the merger.


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