EXHIBIT 10.1

 

SERIES A PREFERRED STOCK PURCHASE AGREEMENT

 

THIS SERIES A PREFERRED STOCK PURCHASE AGREEMENT (this “Agreement”) is made as
of the 23rd day of May, 2012, by and between Frederick’s of Hollywood Group
Inc., a New York corporation (the “Company”), and TTG Apparel, LLC, a Delaware
limited liability company (the “Purchaser”).

 

The parties hereby agree as follows:

 

1.           Purchase and Sale of Preferred Stock.

 

1.1.          Sale and Issuance of Series A Preferred Stock; Closing;
Disclosure.

 

(a)          The Company shall adopt the Certificate of Amendment in the form of
Exhibit A attached to this Agreement (the “Certificate of Amendment”) and, after
the close of trading of the Company’s common stock, $0.01 par value per share
(the “Common Stock”) on the date hereof, file the Certificate of Amendment with
the Secretary of State of the State of New York.

 

(b)          Subject to the terms and conditions of this Agreement, the
Purchaser agrees to purchase and the Company agrees to sell and issue to the
Purchaser 50,000 shares of Series A Convertible Preferred Stock, $0.01 par value
per share, of the Company (the “Series A Preferred Stock”), at a purchase price
of $100.00 per share. The shares of Series A Preferred Stock issued to the
Purchaser pursuant to this Agreement shall be referred to in this Agreement as
the “Shares.”

 

(c)          The closing of the purchase and sale of the Shares provided for
hereunder (the “Closing”) shall occur remotely via the exchange of documents and
signatures on the date hereof but after the close of trading of the Company’s
Common Stock and after the filing of the Certificate of Amendment as provided in
subsection (b) above. Except as required by applicable law, regulation or stock
exchange rule, the Company shall not, prior to the Closing, disclose to any
third parties other than its advisors the existence of, or any information
concerning, this Agreement or the transactions contemplated by this Agreement.
Prior to making any public disclosure of this Agreement or the transactions
contemplated by this Agreement, the Company shall provide the Purchaser and its
counsel with a draft of the disclosure and provide them with the opportunity to
provide the Company with comments on the disclosure.

 

1.2.          Defined Terms Used in this Agreement. In addition to the terms
defined above, the following terms used in this Agreement shall be construed to
have the meanings set forth or referenced below.

 

(a)          “Affiliate” means, with respect to any specified Person, any other
Person who, directly or indirectly, controls, is controlled by, or is under
common control with such Person, including, without limitation, any general
partner, managing member, officer or director of such Person or any venture
capital fund now or hereafter existing that is controlled by one or more general
partners or managing members of, or shares the same management company with,
such Person.

 

 

 

  

(b)          “Code” means the Internal Revenue Code of 1986, as amended.

 

(c)          “Commission” means the United States Securities and Exchange
Commission.

 

(d)          “Company Intellectual Property” means all patents, patent
applications, trademarks, trademark applications, service marks, service mark
applications, tradenames, copyrights, trade secrets, domain names, mask works,
information and proprietary rights and processes, similar or other intellectual
property rights, subject matter of any of the foregoing, tangible embodiments of
any of the foregoing, licenses in to and under any of the foregoing, and any and
all such cases that are owned or used by the Company in the conduct of the
Company’s business as now conducted and as presently proposed to be conducted.

 

(e)          “Control” means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

 

(f)          “ERISA” means the Employee Retirement Income Security Act of 1974,
as amended from time to time.

 

(g)          “ERISA Affiliate” means any trade or business (whether or not
incorporated) that, together with the Company, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

 

(h)          “ERISA Event” means (a) any “reportable event”, as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30 day notice period is waived), (b) the
existence with respect to any Plan of an “accumulated funding deficiency” (as
defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived, (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan, (d) the incurrence by the Company or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan, (e) the receipt by the Company or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan, (f)
the incurrence by the Company or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan, or (g) the receipt by the Company or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Company or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.

  

2

 

  

(i)           “GAAP” means generally accepted accounting principles in the
United States of America.

 

(j)           “Governmental Authority” means the government of the United States
of America, any other nation or any political subdivision thereof, whether state
or local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.

 

(k)          “Material Adverse Effect” means a material adverse effect on the
business, assets (including intangible assets), liabilities, financial
condition, property or results of operations of the Company.

 

(l)          “Multiemployer Plan” means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.

 

(m)          “PBGC” means the Pension Benefit Guaranty Corporation referred to
and defined in ERISA and any successor entity performing similar functions.

 

(n)          “Person” means any individual, corporation, partnership, trust,
limited liability company, association or other entity.

 

(o)          “Plan” means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Company or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of
ERISA.

 

(p)          “Securities Act” means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.

 

(q)          “subsidiary” means with respect to any Person (the “parent”) at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent’s consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent.

 

(r)          “Subsidiary” means any subsidiary of the Company.

 

(s)          “Tax” means any present or future tax, levy, impost, duty,
deduction, withholding, assessment, fee or other charge imposed by any
Governmental Authority, including any interest, additions to tax or penalties
applicable thereto.

 

3

 

  

2.           Representations and Warranties of the Company. The Company hereby
represents and warrants to the Purchaser that, except as set forth on the
Disclosure Schedule attached as Exhibit B to this Agreement, which exceptions
shall be deemed to be part of the representations and warranties made hereunder,
the following representations are true and complete as of the date hereof. The
Disclosure Schedule shall be arranged in sections corresponding to the numbered
and lettered sections and subsections contained in this Section 2, and the
disclosures in any section or subsection of the Disclosure Schedule shall
qualify other sections and subsections in this Section 2 only to the extent it
is readily apparent from a reading of the disclosure that such disclosure is
intended to be applicable to such other sections and subsections.

 

For purposes of these representations and warranties (other than those in
Subsections 2.2, 2.3, 2.4, 2.5, and 2.6), the term “the Company” shall include
any subsidiaries of the Company, unless otherwise noted herein.

 

2.1.          Organization, Good Standing, Corporate Power and Qualification.
The Company is a corporation duly organized, validly existing and in good
standing under the laws of the State of New York and has all requisite corporate
power and authority to carry on its business as presently conducted and as
proposed to be conducted. The Company is duly qualified to transact business and
is in good standing in each jurisdiction in which the failure to so qualify
would have a Material Adverse Effect.

 

2.2.          Capitalization.

 

(a)          The authorized capital of the Company consists, as of the date
hereof, of:

 

(i)          200,000,000 shares of Common Stock, 38,964,891 shares of which are
issued and outstanding. All of the outstanding shares of Common Stock have been
duly authorized, are fully paid and nonassessable and were issued in compliance
with all applicable federal and state securities laws.

 

(ii)         10,000,000 shares of Preferred Stock, of which 125,000 shares have
been designated as Series A Preferred Stock. The rights, privileges and
preferences of the Preferred Stock are as stated in the Certificate of Amendment
and as provided by the New York Business Corporation Law. There are no shares of
Preferred Stock outstanding.

 

(b)          The Company has reserved 6,717,260 shares of Common Stock for
issuance to officers, directors, employees and consultants of the Company and
their respective affiliates pursuant to outstanding options and warrants.

 

(c)          Other than as set forth in this Section above, there are no shares
of capital stock of the Company or securities convertible into capital stock of
the Company outstanding.

 

2.3.          Subsidiaries. Except as set forth in Section 2.3 of the Disclosure
Schedule, the Company does not currently own or control, directly or indirectly,
any interest in any other corporation, partnership, trust, joint venture,
limited liability company, association, or other business entity. The Company
owns all of the stock in its subsidiaries. The Company is not a participant in
any joint venture, partnership or similar arrangement.

 

4

 

  

2.4.          Authorization. All corporate action required to be taken by the
Company in order to authorize the Company to enter into this Agreement, issue
the Warrants (as hereinafter defined), file the Certificate of Amendment and
issue the Shares and Warrants (as hereinafter defined) and the Common Stock
issuable upon conversion of the Shares or exercise of the Warrants, has been
taken. All action on the part of the officers of the Company necessary for the
execution and delivery of this Agreement and the other documents referenced
above, the performance of all obligations of the Company under this Agreement to
be performed, and the issuance and delivery of the Shares has been taken. The
Agreement, the Warrants and the Certificate of Amendment , when executed and
delivered by the Company, shall constitute valid and legally binding obligations
of the Company, enforceable against the Company in accordance with their
respective terms except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance, or other laws of general
application relating to or affecting the enforcement of creditors’ rights
generally, (ii) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies, or (iii) to the
extent indemnification provisions may be limited by applicable federal or state
securities laws.

 

2.5.          Valid Issuance of Shares. The Shares and Warrants, when issued,
sold and delivered in accordance with the terms and for the consideration set
forth in this Agreement, will be validly issued, fully paid and nonassessable
and free of restrictions on transfer other than restrictions on transfer under
applicable state and federal securities laws and liens or encumbrances created
by or imposed by the Purchaser. Assuming the accuracy of the representations of
the Purchaser in Section 3 of this Agreement and subject to the filings
described in Subsection 2.6 below, the Shares will be issued, in compliance with
all applicable federal and state securities laws. The shares of Series A
Preferred Stock that will be issued as dividends on the Shares and on other
shares of Series A Preferred Stock that will have been issued as dividends, when
issued and delivered in accordance with the terms of the Certificate of
Amendment, will be validly issued, fully paid and nonassessable and free of
restrictions on transfer other than restrictions on transfer under applicable
state and federal securities laws and liens or encumbrances created by or
imposed by the Purchaser. The Common Stock issuable upon conversion of the
Shares and exercise of the Warrants has been duly reserved for issuance, and
upon issuance in accordance with the terms of the Certificate of Amendment or
the Warrants, as the case may be, will be validly issued, fully paid and
nonassessable and free of restrictions on transfer other than restrictions on
transfer under applicable federal and state securities laws and liens or
encumbrances created by or imposed by the Purchaser. Based in part upon the
representations of the Purchaser in Section 3 of this Agreement, and subject to
Subsection 2.6 below, the Common Stock issuable upon conversion of the Shares
and exercise of the Warrants will be issued in compliance with all applicable
federal and state securities laws.

 

2.6.          Consents and Filings. Assuming the accuracy of the representations
made by the Purchaser in Section 3 of this Agreement, no consent, approval,
order or authorization of, or registration, qualification, designation,
declaration or filing with, any Governmental Authority or any other Person is
required on the part of the Company in connection with the consummation of the
transactions contemplated by this Agreement, except for (i) the filing of the
Certificate of Amendment, which will have been filed as of the date hereof, (ii)
filings pursuant to Regulation D of the Securities Act, and applicable state
securities laws, which have been made or will be made in a timely manner and
(iii) approval by the NYSE MKT of the issuance of the Common Stock issuable upon
conversion of the Shares and exercise of the Warrants.

 

5

 

  

2.7.          Compliance with Other Instruments. The Company is not in violation
or default (i) of any provisions of its Restated Certificate of Incorporation or
Bylaws, (ii) of any instrument, judgment, order, writ or decree, (iii) under any
credit agreement or facility, note, indenture or mortgage, or (iv) under any
lease, agreement, contract or purchase order to which it is a party or by which
it is bound, or of any provision of federal or state statute, rule or regulation
applicable to the Company, the violation of any of which would have a Material
Adverse Effect. The execution, delivery and performance of the Agreement and the
consummation of the transactions contemplated by the Agreement will not result
in any such violation or be in conflict with or constitute, with or without the
passage of time and giving of notice, either (i) a default under any such
provision, instrument, judgment, order, writ, decree, contract or agreement or
(ii) an event which results in the creation of any lien, charge or encumbrance
upon any assets of the Company or the suspension, revocation, forfeiture, or
nonrenewal of any material permit or license applicable to the Company.

 

2.8.          Rights of Registration. The Company is not under any obligation to
register under the Securities Act any of its currently outstanding securities or
any securities issuable upon exercise or conversion of its currently outstanding
securities.

 

2.9.          Property. Except as set forth in Section 2.9 of the Disclosure
Schedule, the property and assets that the Company owns are free and clear of
all mortgages, deeds of trust, liens, loans and encumbrances, except for
statutory liens for the payment of current taxes that are not yet delinquent and
encumbrances and liens that arise in the ordinary course of business and do not
materially impair the Company’s ownership or use of such property or assets.
With respect to the property and assets it leases, the Company is in compliance
with such leases and, to its knowledge, holds a valid leasehold interest free of
any liens, claims or encumbrances other than those of the lessors of such
property or assets. The Company does not own any real property.

 

2.10.         SEC Filings; Financial Statements. The Company has delivered or
made available to the Purchaser prior to the execution of this Agreement, true
and complete copies of all periodic reports, registration statements and proxy
statements filed by it with the Commission since July 27, 2008. Each of such
filings with the Commission (collectively, the “SEC Filings”), as of its filing
date, complied in all material respects with the requirements of the rules and
regulations promulgated by the Commission with respect thereto and did not
contain any untrue statement of a material fact or omit a material fact
necessary in order to make the statements contained therein not misleading in
light of the circumstances in which such statements were made. The financial
statements included in the SEC Filings (the “Financial Statements”) have been
prepared in accordance with GAAP applied on a consistent basis throughout the
periods indicated, except that the unaudited Financial Statements may not
contain all footnotes required by GAAP. The Financial Statements fairly present
in all material respects the financial condition and operating results of the
Company as of the dates, and for the periods, indicated therein, subject in the
case of the unaudited Financial Statements to normal year-end audit adjustments.
Except as set forth in the Financial Statements, the Company has no material
liabilities or obligations, contingent or otherwise, other than (i) liabilities
incurred in the ordinary course of business subsequent to January 28, 2012,
(ii) obligations under contracts and commitments incurred in the ordinary course
of business and (iii) liabilities and obligations of a type or nature not
required under GAAP to be reflected in the Financial Statements, which, in all
such cases, individually and in the aggregate would not have a Material Adverse
Effect. The Company maintains and will continue to maintain a standard system of
accounting established and administered in accordance with GAAP.

 

6

 

  

2.11.         Changes. Since January 28, 2012, the Company and its subsidiaries,
taken as a whole, has not suffered any Material Adverse Effect, except for those
occurring as a result of general economic or financial conditions affecting the
United States as a whole or the region in which the Company conducts its
business or developments that are not unique to the Company but also affect
other entities engaged or participating in the women’s intimate apparel industry
generally in a manner not materially less severely. For purposes of this
section, revenues and operating results materially consistent with the Company’s
revenues and operating results for the quarter ended January 28, 2012, as
reflected in the Company’s Quarterly Report on Form 10-Q for the quarter ended
January 28, 2012, shall not be deemed a Material Adverse Effect.

 

2.12.         Insurance. The Company has in full force and effect fire and
casualty insurance policies with extended coverage, sufficient in amount
(subject to reasonable deductions) to allow it to replace any of its properties
that might be damaged or destroyed.

 

2.13.         Permits. The Company has all franchises, permits, licenses and any
similar authority necessary for the conduct of its business, the lack of which
could reasonably be expected to have a Material Adverse Effect. The Company is
not in default in any material respect under any of such franchises, permits,
licenses or other similar authority.

 

2.14.         Compliance with Laws. Since January 28, 2012, the Company has
conducted its business in compliance with all applicable laws, rules,
regulations, court or administrative orders and processes and rules, directives
and orders of regulatory and self-regulatory agencies and bodies, except as
would not reasonably be expected, singly or in the aggregate, to have a Material
Adverse Effect.

 

2.15.         Labor Relations. Neither the Company nor any of its Subsidiaries
is engaged in any unfair labor practice that could reasonably be expected to
have a Material Adverse Effect. There is (a) no significant unfair labor
practice complaint pending against the Company or any of its Subsidiaries or, to
the best knowledge of the Company, threatened in writing against any of them
before the National Labor Relations Board or any similar governmental authority
in any jurisdiction, and no significant grievance or significant arbitration
proceeding arising out of or under any collective bargaining agreement is so
pending against the Company or any of its Subsidiaries or, to the best knowledge
of the Company, threatened in writing against any of them, (b) no significant
strike, labor dispute, slowdown or stoppage is pending against the Company or
any of its Subsidiaries or, to the best knowledge of the Company, threatened in
writing against the Company or any of its Subsidiaries and (c) to the best
knowledge of the Company, no question concerning union representation exists
with respect to the employees of the Company or any of its Subsidiaries, except
(with respect to any matter specified in clause (a), (b) or (c) above, either
individually or in the aggregate) such as could not reasonably be expected to
have a Material Adverse Effect.

 

7

 

  

2.16.         Intellectual Property. Each of the Company and its Subsidiaries
owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and
other intellectual property material to its business, and the use thereof by the
Company and its Subsidiaries does not infringe upon the rights of any other
person or entity, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

 

2.17.         Litigation. Except as set forth in Section 2.17 of the Disclosure
Schedule, there are no actions, suits or proceedings by or before any arbitrator
or Governmental Authority pending against the Company or any of its Subsidiaries
or, to the knowledge of the Company, threatened against or affecting the Company
or any of its Subsidiaries, that would result in a judgment or judgments against
the Company or any of its Subsidiaries in an amount in excess of $200,000 or
that could reasonably be expected to have a Material Adverse Effect or, to the
knowledge of the Company, that involve this Agreement or the transactions
contemplated hereby.

 

2.18.         Taxes. Each of the Company and its Subsidiaries has timely filed
or caused to be filed all Tax returns and reports required to have been filed
and has paid or caused to be paid all Taxes required to have been paid by it,
except (a) Taxes that are being contested in good faith by appropriate
proceedings and for which the Company or such Subsidiary, as applicable, has set
aside on its books adequate reserves or (b) to the extent that the failure to do
so could not reasonably be expected to result in a Material Adverse Effect.

 

2.19.         ERISA. No ERISA Event has occurred or is reasonably expected to
occur that, when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed the fair
market value of the assets of such Plan, and the present value of all
accumulated benefit obligations of all underfunded Plans (based on the
assumptions used for purposes of Statement of Financial Accounting Standards No.
87) did not, as of the date of the most recent financial statements reflecting
such amounts, exceed the fair market value of the assets of all such underfunded
Plans.

 

2.20.         Solvency. Immediately after the consummation of the transactions
contemplated by this Agreement (i) the fair value of the assets of each of the
Company and Subsidiaries at a fair valuation, will exceed its debts and
liabilities, subordinated, contingent or otherwise; (ii) the present fair
saleable value of the property of each of the Company and its Subsidiaries will
be greater than the amount that will be required to pay the probable liability
of its debts and other liabilities, subordinated, contingent or otherwise, as
such debts and other liabilities become absolute and matured; (iii) each of the
Company and its Subsidiaries will be able to pay its debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and (iv) each of the Company and its Subsidiaries will not
have unreasonably small capital with which to conduct the business in which it
is engaged as such business is now conducted and is proposed to be conducted
after the date hereof.

 

8

 

  

2.21.         Disclosure. The Company has disclosed to the Purchaser all
agreements, instruments and corporate or other restrictions to which it or any
of its Subsidiaries is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. None of the reports, financial statements, certificates
or other information furnished by or on behalf of the Company or any of its
Subsidiaries to the Purchaser in connection with the negotiation of this
Agreement or delivered hereunder (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided that,
with respect to projected financial information, the Company represents only
that such information was prepared in good faith based upon assumptions believed
to be reasonable at the time.

 

3.          Representations and Warranties of the Purchaser. The Purchaser
hereby represents and warrants to the Company that:

 

3.1.          Authorization. The Purchaser has full power and authority to enter
into this Agreement. The Agreement, when executed and delivered by the
Purchaser, will constitute valid and legally binding obligations of the
Purchaser, enforceable in accordance with their terms, except (a) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance, and any other laws of general application affecting enforcement of
creditors’ rights generally, and as limited by laws relating to the availability
of specific performance, injunctive relief, or other equitable remedies, or
(b) to the extent indemnification provisions may be limited by applicable
federal or state securities laws.

 

3.2.          Purchase Entirely for Own Account. This Agreement is made with the
Purchaser in reliance upon the Purchaser’s representation to the Company, which
by the Purchaser’s execution of this Agreement, the Purchaser hereby confirms,
that the Shares to be acquired by the Purchaser will be acquired for investment
for the Purchaser’s own account, not as a nominee or agent, and not with a view
to the resale or distribution of any part thereof, and that the Purchaser has no
present intention of selling, granting any participation in, or otherwise
distributing the same in violation of the securities laws of the United States.
By executing this Agreement, the Purchaser further represents that the Purchaser
does not presently have any contract, undertaking, agreement or arrangement with
any Person to sell, transfer or grant participations to such Person or to any
third Person, with respect to any of the Shares. The Purchaser has not been
formed for the specific purpose of acquiring the Shares.

 

3.3.          Disclosure of Information. The Purchaser has had an opportunity to
discuss the Company’s business, management, financial affairs and the terms and
conditions of the offering of the Shares with the Company’s management and has
had an opportunity to review the Company’s facilities. The foregoing, however,
does not limit or modify the representations and warranties of the Company in
Section 2 of this Agreement or the right of the Purchaser to rely thereon.

 

9

 

  

3.4.          Restricted Securities. The Purchaser understands that the Shares
have not been, and will not be, registered under the Securities Act, by reason
of a specific exemption from the registration provisions of the Securities Act
which depends upon, among other things, the bona fide nature of the investment
intent and the accuracy of the Purchaser’s representations as expressed herein.
The Purchaser understands that the Shares are “restricted securities” under
applicable U.S. federal and state securities laws and that, pursuant to these
laws, the Purchaser must hold the Shares indefinitely unless they are registered
with the Securities and Exchange Commission and qualified by state authorities,
or an exemption from such registration and qualification requirements is
available. The Purchaser acknowledges that the Company has no obligation to
register or qualify the Shares or Warrants, or the Common Stock into which it
may be converted or exercised, as applicable, for resale except as set forth in
this Agreement. The Purchaser further acknowledges that if an exemption from
registration or qualification is available, it may be conditioned on various
requirements including, but not limited to, the time and manner of sale, the
holding period for the Shares, and on requirements relating to the Company which
are outside of the Purchaser’s control, and which the Company is under no
obligation and may not be able to satisfy.

 

3.5.          No Public Market. The Purchaser understands that no public market
now exists for the Shares, and that the Company has made no assurances that a
public market will ever exist for the Shares.

 

3.6.          Legends. The Purchaser understands that the Shares and any
securities issued in respect of or exchange for the Shares, will bear the
following legend:

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A
VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH
TRANSFER MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED
THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.”

 

3.7.          Accredited Investor. The Purchaser is an accredited investor as
defined in Rule 501(a) of Regulation D promulgated under the Securities Act.

 

3.8.          Foreign Investors. If the Purchaser is not a United States person
(as defined by Section 7701(a)(30) of the Code), the Purchaser hereby represents
that it has satisfied itself as to the full observance of the laws of its
jurisdiction in connection with any invitation to subscribe for the Shares or
any use of this Agreement, including (i) the legal requirements within its
jurisdiction for the purchase of the Shares, (ii) any foreign exchange
restrictions applicable to such purchase, (iii) any governmental or other
consents that may need to be obtained, and (iv) the income tax and other tax
consequences, if any, that may be relevant to the purchase, holding, redemption,
sale, or transfer of the Shares. The Purchaser’s subscription and payment for
and continued beneficial ownership of the Shares will not violate any applicable
securities or other laws of the Purchaser’s jurisdiction.

 

10

 

  

3.9.          No General Solicitation. Neither the Purchaser, nor any of its
officers, directors, employees, agents, stockholders or partners has either
directly or indirectly, including through a broker or finder (a) engaged in any
general solicitation, or (b) published any advertisement in connection with the
offer and sale of the Shares.

 

3.10.         Exculpation Among Purchasers. The Purchaser acknowledges that it
is not relying upon any Person, other than the Company and its officers and
directors, in making its investment or decision to invest in the Company.

 

3.11.         Residence. The principal place of business of the Purchaser is
identified in the address of the Purchaser set forth on the signature page
hereof.

 

4.          Deliveries by the Company. On or before the date hereof, the Company
shall deliver the following to Purchaser:

 

4.1.          Company Compliance Certificate. The Chief Executive Officer of the
Company shall deliver to the Purchaser a certificate certifying that (i) the
representations and warranties of the Company contained in Section 2 that are
(A) qualified as to materiality are true and correct and (B) not qualified as to
materiality are true and correct in all material respects and (ii) the Company
shall have performed and complied with all covenants, agreements, obligations
and conditions in this Agreement that are required to be performed or complied
with by the Company on or before the date hereof.

 

4.2.          Opinion of Company Counsel. The Purchaser shall have received from
Graubard Miller, counsel for the Company, an opinion in substantially the form
of Exhibit C attached to this Agreement.

 

4.3.          Certificate of Amendment. The Company shall have filed the
Certificate of Amendment with the Secretary of State of New York.

 

4.4.          Secretary’s Certificate. The Secretary of the Company shall have
delivered to the Purchaser a certificate certifying (i) the Restated Certificate
of Incorporation and Bylaws of the Company and (ii) resolutions of the Board of
Directors of the Company approving the Agreement, the transactions contemplated
under the Agreement and the Certificate of Amendment.

 

4.5.          Expenses. The Company shall pay, or reimburse the Purchaser for,
the Purchaser’s reasonable out-of-pocket expenses (including but not limited to
reasonable attorneys’ fees and disbursements), in an amount not to exceed
$50,000, related to the negotiation and documentation of this Agreement and the
ancillary documents hereto and the issuance of the Shares to it hereunder and
thereafter.

 

4.6.          Shares. The Company shall deliver to the Purchaser a certificate
representing the Shares.

 

11

 

 

 

4.7.          Warrants. The Company shall have issued to the Purchaser three (3)
warrants, each to purchase 500,000 shares of Common Stock, having terms of three
(3), five (5) and seven (7) years, at exercise prices of $0.45, $0.53 and $0.60
per share, respectively, substantially in the form of the Common Stock Purchase
Warrant attached to this Agreement as Exhibit D (the “Warrants”).

 

5.          Deliveries by the Purchaser.

 

5.1.          Purchase Price. The Purchaser shall pay the purchase price for the
Shares by wire transfer to a bank account designated by the Company.

 

5.2.          Purchaser Compliance Certificate. The Purchaser shall deliver to
the Company a certificate certifying that (i) the representations and warranties
of the Purchaser contained in Section 3 that are (A) qualified as to materiality
are true and correct and (B) not qualified as to materiality are true and
correct in all material respects and (ii) the Purchaser shall have performed and
complied with all covenants, agreements, obligations and conditions in this
Agreement that are required to be performed or complied with by the Purchaser on
or before the date hereof.

 

6.          Additional Obligations.

 

6.1.          Registration Rights. Within 60 days after the Closing, the Company
shall (i) file a registration statement (“Registration Statement”) with the
Commission covering the resale by the Purchaser of the shares of Common Stock
underlying the Shares, the shares of Common Stock underlying any shares of
Series A Preferred Stock issued as dividends on the Shares, and the shares of
Common Stock underlying the Warrants (“Registrable Securities”), (ii) use its
best efforts to have such Registration Statement declared effective as promptly
as practicable thereafter, and (iii) keep the Registration Statement effective
until (1) the date on which the Registrable Securities may be resold by the
Purchaser without registration under the Securities Act and without regard to
any volume limitations by reason of Rule 144 under the Securities Act or any
other rule of similar effect or (2) all of the Registrable Securities have been
sold pursuant to the Registration Statement or Rule 144 under the Securities Act
or any other rule of similar effect. The Purchaser understands, however, that
notwithstanding this obligation on the part of the Company to register the
resale of the Registrable Securities and to keep the Registration Statement
effective, there is no assurance that the Company will be able to have the
Registration Statement declared effective and keep the Registration Statement
effective until the Purchaser has sold all the Registrable Securities owned by
the Purchaser registered thereon. The Company’s obligation to register the
Registrable Securities pursuant to the Registration Statement shall be subject
to the Purchaser’s delivery to the Company of such information regarding the
Purchaser, the securities of the Company held by the Purchaser, and the intended
method of disposition of the Registrable Securities as reasonably required by
the Company to effect the registration of such Registrable Securities. The
Company shall, promptly upon receipt of notice of a transfer by the Purchaser,
add to the Registration Statement any transferee of the Shares, any transferee
of any shares of Series A Preferred Stock issued as dividends on the Shares, and
any transferee of the Warrants.

 

12

 

 

 

6.2.          Use of Proceeds. The Company shall use the proceeds of the sale of
Shares hereunder solely for paying, settling or discharging accounts payable of
the Company.

 

6.3.          NYSE MKT Additional Listing Application Approval. The Company
shall promptly after the date hereof use its best efforts to obtain approval
from the NYSE MKT to list the shares of Common Stock issuable upon conversion of
the Shares (including dividends) and exercise of the Warrants, and shall not
issue any such shares of Common Stock unless and until such approval is
obtained.

 

6.4.          Shareholder Approval. The Purchaser and its affiliates currently
own an aggregate of 10,153,299 shares of Common Stock, or approximately 26.1% of
the outstanding shares.  Fursa Alternative Strategies LLC (“Fursa”), on behalf
of certain funds and accounts affiliated with or managed by it or its
affiliates, together with William F. Harley, Chief Investment Officer of Fursa,
currently own an aggregate of 17,287,335 shares of Common Stock, or
approximately 44.4% of the outstanding shares.  In accordance with NYSE MKT
interpretations and guidelines relating to obtaining shareholder approval upon a
change of control, the Company shall not issue to the Purchaser shares of Common
Stock upon conversion of the Series A Preferred Stock and exercise of Warrants
in excess of 7,134,036, unless and until the Company obtains shareholder
approval in connection with such issuance. If, at any time, the number of shares
of Common Stock that would be issuable upon conversion of the Series A Preferred
Stock and the Warrants exceeds 7,134,036, the Company shall immediately
thereupon use its best efforts to obtain shareholder approval of the issuance of
all shares of Common Stock then and at any time thereafter issuable upon
conversion of the Series A Preferred Stock and exercise of the Warrants in
accordance with the terms of the Certificate of Amendment and the Warrants.

 

6.5.          Actions Required With Respect to Dividends. The Corporation shall
take all actions required or permitted under the Business Corporation Law of the
State of New York (the “BCL”) (a) to permit the payment of the Series A
Preferred Dividend (as defined in the Certificate of Amendment), including
through the revaluation of its assets in accordance with the BCL, to make or
keep funds legally available for the payment of dividends and (b) to declare and
pay such dividends.

 

7.          Miscellaneous.

 

7.1.          Survival of Warranties and Covenants. Unless otherwise set forth
in this Agreement, the representations and warranties of the Company and the
Purchaser contained in or made pursuant to this Agreement shall survive for
twelve (12) months from the date hereof (the date that is twelve (12) months
from the date hereof, the “Survival Date”) regardless of any investigation made
by the Purchaser or on its behalf. Notwithstanding any provision to the contrary
contained in this Agreement, with respect to claims for breaches of
representations and warranties contained in this Agreement, no party will be
liable with respect thereto unless written notice of a possible claim with
respect to such breach is given by the party making such claim on or prior to
the Survival Date, it being understood that so long as such written notice is
given on or prior to the Survival Date, such representations and warranties
shall continue to survive until such matter is resolved. All covenants and
agreements contained herein shall survive until they are completed or no longer
applicable in accordance with the terms of this Agreement.

 

13

 

  

7.2.          Successors and Assigns. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors and
assigns of the parties. The Purchaser shall be permitted to assign its rights
under this Agreement with the prior written consent of the Company, which shall
not be unreasonably withheld. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations,
or liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement.

 

7.3.          Indemnification.

 

(a)          The Company shall defend, protect, indemnify and hold harmless the
Purchaser, and all of its officers, directors, employees and agents (including,
without limitation, those retained in connection with the transactions
contemplated by this Agreement) (collectively, the “Purchaser Indemnitees”) from
and against any and all actions, causes of action, suits, claims, costs,
penalties, fees, liabilities and damages, and expenses in connection therewith
(irrespective of whether any such Purchaser Indemnitee is a party to the action
for which indemnification hereunder is sought), including reasonable attorneys’
fees and disbursements (the “Indemnified Liabilities”), incurred by the
Purchaser Indemnitees or any of them as a result of, or arising out of, or
relating to (a) any misrepresentation or breach of any representation or
warranty made by the Company in this Agreement or any of the agreements
contemplated hereby, (b) any breach of any covenant, agreement or obligation of
the Company contained in this Agreement or any of the agreements contemplated
hereby, or (c) the execution, delivery or performance of this Agreement, any
Agreements contemplated hereby including the Certificate of Amendment or the
transactions contemplated hereby or thereby. To the extent that the foregoing
undertaking by the Company may be unenforceable for any reason, the Company
shall make the maximum contribution to the payment and satisfaction of each of
the Indemnified Liabilities that is permissible under applicable law. The
indemnification provided for under this Section 7.3(a) shall not apply to any
Indemnified Liabilities arising out of the gross negligence or intentional
misconduct of any Purchaser Indemnitee.

 

(b)          The Purchaser shall defend, protect, indemnify and hold harmless
the Company and all of its officers, directors, employees and agents (including,
without limitation, those retained in connection with the transactions
contemplated by this Agreement) (collectively, the “Company Indemnitees”) from
and against any and all Indemnified Liabilities incurred by the Company
Indemnitees or any of them as a result of, or arising out of, or relating to (a)
any misrepresentation or breach of any representation or warranty made by the
Purchaser in this Agreement or any of the agreements contemplate hereby, or (b)
any breach of any covenant, agreement or obligation of the Purchaser contained
in this Agreement or any of the agreements contemplated thereby. To the extent
that the foregoing undertaking by the Purchaser may be unenforceable for any
reason, the Purchaser shall make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities that is permissible under
applicable law. The indemnification provided for under this Section 7.3(b) shall
not apply to any Indemnified Liabilities arising out of the gross negligence or
intentional misconduct of any Company Indemnitee.

 

14

 

  

(c)          No amount shall be payable under this Section 7.3 unless the
aggregate amount of all Indemnified Liabilities otherwise payable by a party
exceeds $50,000, in which event the entire amount of such Indemnified
Liabilities shall be payable from the first dollar.

 

7.4.          Governing Law. This Agreement shall be governed by the internal
law of the State of New York.

 

7.5.          Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Counterparts may be
delivered via facsimile, electronic mail (including pdf) or other transmission
method and any counterpart so delivered shall be deemed to have been duly and
validly delivered and be valid and effective for all purposes.

 

7.6.          Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

 

7.7.          Notices. All notices and other communications given or made
pursuant to this Agreement shall be in writing and shall be deemed effectively
given upon the earlier of actual receipt or: (a) personal delivery to the party
to be notified, (b) when sent, if sent by electronic mail or facsimile during
normal business hours of the recipient, and if not sent during normal business
hours, then on the recipient’s next business day, (c) five (5) days after having
been sent by registered or certified mail, return receipt requested, postage
prepaid, or (d) one (1) business day after deposit with a nationally recognized
overnight courier, freight prepaid, specifying next business day delivery, with
written verification of receipt. All communications shall be sent to the
respective parties at their address as set forth on the signature page, or to
such e-mail address, facsimile number or address as subsequently modified by
written notice given in accordance with this Subsection 7.6. If notice is given
to the Company, a copy shall also be sent to Graubard Miller, 405 Lexington
Avenue, New York, New York 10174, Attn: David Alan Miller, Esq. and if notice is
given to the Purchaser, a copy shall also be given to Edwards Wildman Palmer
LLP, 225 West Wacker Drive, Suite 2800, Chicago, Illinois 60606, Attn: Adam S.
Calisoff, Esq.

 

7.8.          No Finder’s Fees. Each party represents that it neither is nor
will be obligated for any finder’s fee or commission in connection with this
transaction. The Purchaser agrees to indemnify and to hold harmless the Company
from any liability for any commission or compensation in the nature of a
finder’s or broker’s fee arising out of this transaction (and the costs and
expenses of defending against such liability or asserted liability) for which
the Purchaser or any of its officers, employees, or representatives is
responsible. The Company agrees to indemnify and hold harmless the Purchaser
from any liability for any commission or compensation in the nature of a
finder’s or broker’s fee arising out of this transaction (and the costs and
expenses of defending against such liability or asserted liability) for which
the Company or any of its officers, employees or representatives is responsible.

 

15

 

 

 

7.9.          Amendments and Waivers. Any term of this Agreement may be amended,
terminated or waived only with the written consent of the Company and (i) the
holders of at least 50% of the then-outstanding Shares. Any amendment or waiver
effected in accordance with this Subsection 7.9 shall be binding upon the
Purchaser and each transferee of the Shares (or the Common Stock issuable upon
conversion thereof), each future holder of all such securities, and the Company.

 

7.10.         Severability. The invalidity or unenforceability of any provision
hereof shall in no way affect the validity or enforceability of any other
provision.

 

7.11.         Delays or Omissions. No delay or omission to exercise any right,
power or remedy accruing to any party under this Agreement, upon any breach or
default of any other party under this Agreement, shall impair any such right,
power or remedy of such non-breaching or non-defaulting party nor shall it be
construed to be a waiver of any such breach or default, or an acquiescence
therein, or of or in any similar breach or default thereafter occurring; nor
shall any waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character on the part of any party of any
breach or default under this Agreement, or any waiver on the part of any party
of any provisions or conditions of this Agreement, must be in writing and shall
be effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement or by law or otherwise afforded to any
party, shall be cumulative and not alternative.

 

7.12.         Entire Agreement. This Agreement (including the Exhibits hereto)
and the Certificate of Amendment constitute the full and entire understanding
and agreement between the parties with respect to the subject matter hereof, and
any other written or oral agreement relating to the subject matter hereof
existing between the parties are expressly canceled.

 

7.13.         Dispute Resolution. The parties (a) hereby irrevocably and
unconditionally submit to the jurisdiction of the state courts of New York and
to the jurisdiction of the United States District Court for the District of
Southern New York for the purpose of any suit, action or other proceeding
arising out of or based upon this Agreement, (b) agree not to commence any suit,
action or other proceeding arising out of or based upon this Agreement except in
the state courts of New York or the United States District Court for the
District of Southern New York, and (c) hereby waive, and agree not to assert, by
way of motion, as a defense, or otherwise, in any such suit, action or
proceeding, any claim that it is not subject personally to the jurisdiction of
the above-named courts, that its property is exempt or immune from attachment or
execution, that the suit, action or proceeding is brought in an inconvenient
forum, that the venue of the suit, action or proceeding is improper or that this
Agreement or the subject matter hereof may not be enforced in or by such court.

 

[Signature Page Follows]

 

16

 

  

IN WITNESS WHEREOF, the parties have executed this Series A Preferred Stock
Purchase Agreement as of the date first written above.

 

  COMPANY:           FREDERICK’S OF HOLLYWOOD GROUP INC.         By: /s/ Thomas
J. Lynch         Name: Thomas J. Lynch         Title: Chief Executive Officer  
      Address: 6255 Sunset Blvd., 6th Floor     Hollywood, CA 90028            
  PURCHASER:         TTG APPAREL, LLC         By: /s/ Michael T. Tokarz        
Name: Michael T. Tokarz         Title: Manager         Address:  287 Bowman
Avenue, 2nd Floor     Purchase, New York  10577

  

 

 

  

EXHIBIT A

 

FORM OF CERTIFICATE OF AMENDMENT

 

See Exhibit 3.1 to Form 8-K

 

 

 

 

EXHIBIT B

 

DISCLOSURE SCHEDULE

 

Schedule 2.3

Subsidiaries

 

FOH Holdings, Inc.   Incorporated:   Delaware, May 9, 1997     Authorized Stock:
  100 Common Shares, $.01 par value     Issued Stock:   100 Common Shares*    
Sole Shareholder:   Frederick’s of Hollywood Group Inc.           Frederick’s of
Hollywood, Inc.   Incorporated:   Delaware, March 1, 1962     Authorized Stock:
  3,000 Common Shares, $0.01 par value     Issued Stock   1,000 Common Shares*  
  Sole Shareholder:   FOH Holdings, Inc.           Frederick’s of Hollywood
Stores, Inc.   Incorporated:   Nevada, July 8, 1998     Authorized Stock:  
1,000 common shares, $0.01 par value     Issued Stock   100 common shares*    
Sole Shareholder:   Frederick’s of Hollywood, Inc.           Hollywood Mail
Order, LLC   Formation:   Nevada, July 20, 1999     Manager:   FOH Holdings,
Inc.     Sole Member:   Frederick’s of Hollywood, Inc.

 

 

*Securities pledged to Wells Fargo Retail Finance II, LLC (“Senior Lender”) in
accordance with the terms of that certain Pledge and Security Agreement, dated
as of January 28, 2008, by the Company for the benefit of the Senior Lender.

 

Schedules to Series A Preferred Stock Purchase Agreement

 

 

 

 

Schedule 2.9

Liens

 

DEBTOR  

SECURED

PARTY/creditor

  STATE  

UCC or

filing

NUMBEr

 

FILING 

DATE

  collateral TANGIBLE ASSETS                     Frederick’s of Hollywood Group
Inc.   Wells Fargo Retail Finance II, LLC, as agent   NY   200801290081909  
1/29/08   All assets. Frederick’s of Hollywood Group Inc.          
201011290646852   11/29/10   UCC-3 Amendment to filing no.  200801290081909
deleting from the collateral all assets relating to Debtor’s wholesale division.
Frederick’s of Hollywood Group Inc.           201109230511864   9/23/11  
UCC-3Assignment to filing no. 200801290081909 to Wells Fargo Bank, National
Association, as agent. Frederick’s of Hollywood Group Inc.   Hilco Brands, LLC  
NY   201008030422883   8/3/2010   All assets. Frederick’s of Hollywood Group
Inc.   Hilco Brands, LLC   NY   201011290646876   11/29/10   UCC-3 Amendment to
filing no 201008030422883 deleting from the collateral all assets relating to
Debtor’s wholesale division. FOH Holdings, Inc.   Wells Fargo Retail Finance II,
LLC, as agent   DE   30029085   1/6/03   All assets. FOH Holdings, Inc.       DE
  31309767   5/23/03   UCC-3 Assignment of filing no. 30029085 to Wells Fargo
Retail Finance II, as agent. FOH Holdings, Inc.       DE   20073004263   8/8/07
  UCC-3 Continuation of filing no. 30029085 FOH Holdings, Inc.       DE  
20104356675   12/9/10   UCC-3 Amendment to filing no. 30029085 changing Secured
Party’s name to Wells Fargo Bank, National Association FOH Holdings, Inc.      
DE   20113665752   9/22/11   UCC-3 Assignment of filing no. 30029085 to Wells
Fargo Bank, National Association, as agent. FOH Holdings, Inc.   Hilco Brands,
LLC   DE   20102690166   8/3/10   All assets. FOH Holdings, Inc.   Wells Fargo
Bank, National Association, as agent   DE   20113665836   9/22/11   All assets.
Frederick’s of Hollywood, Inc.   Wells Fargo Retail Finance II, LLC, as agent  
DE   30029051   1/6/03   All assets. Frederick’s of Hollywood, Inc.       DE  
31309866   5/22/03   UCC-3 Assignment of filing no. 30029051 to Wells Fargo
Retail Finance II, LLC, as agent. Frederick’s of Hollywood, Inc.       DE  
20073004289   8/8/07   UCC-3 Continuation of filing no. 30029051.

  

Schedules to Series A Preferred Stock Purchase Agreement

 

 

 

 

DEBTOR  

SECURED

PARTY/creditor

  STATE  

UCC or

filing

NUMBEr

 

FILING

DATE

  collateral Frederick’s of Hollywood, Inc.       DE   20104354126   12/9/10  
UCC-3 Amendment to filing no. 30029051 changing Secured Party’s name to Wells
Fargo Bank, National Association Frederick’s of Hollywood, Inc.       DE  
20113665786   9/22/11   UCC-3 Assignment of filing no. 30029051 to Wells Fargo
Bank, National Association, as agent Frederick’s of Hollywood, Inc.   Hilco
Brands, LLC   DE   20102690232   8/3/2010   All assets. Frederick’s of
Hollywood, Inc.   Wells Fargo Bank, National Association, as agent   DE  
20113665869   9/22/11   All assets. Frederick’s of Hollywood Stores, Inc.  
Wells Fargo Retail Finance II, LLC, as agent   NV   2003000343-4   1/6/03   All
assets Frederick’s of Hollywood Stores, Inc.       NV   2003017174-4   6/25/03  
UCC-3 Assignment of filing no 2003000343-4 to Wells Fargo Retail Finance II, LLC
as agent. Frederick’s of Hollywood Stores, Inc.       NV   2007037405-7  
11/9/07   UCC-3 Continuation of filing no. 2003000343-4 Frederick’s of Hollywood
Stores, Inc.       NV   2010030873-8   12/9/10   UCC-3 Amendment to filing no.
2003000343-4 to change the Secured Party’s name to Wells Fargo Bank, National
Association. Frederick’s of Hollywood Stores, Inc.       NV   2008034177-1  
11/6/08   All assets. Frederick’s of Hollywood Stores, Inc.       NV  
2010030860-1   12/9/10   UCC-3 Amendment to filing no. 2008034177-1 changing the
Secured Party’s name to Wells Fargo Bank, National Association. Frederick’s of
Hollywood Stores, Inc.       NV   2011025414-1   9/23/11   UCC-3 Assignment of
filing no. 2008034177-1 to Wells Fargo Bank, National Association, as agent.
Frederick’s of Hollywood Stores, Inc.   Hilco Brands, LLC   NV   20100195452-1  
8/3/10   All assets. Frederick’s of Hollywood Stores, Inc.   Hilco Brands, LLC  
NV   2010029817-7   11/29/10   UCC-3 Amendment to filing no. 2010019452-1
deleting from the collateral all assets relating to the Debtor’s wholesale
division. Frederick’s of Hollywood Stores, Inc.   Wells Fargo Bank, National
Association, as agent   NV   2011025411-5   9/23/11   All assets. Hollywood Mail
Order, LLC   Wells Fargo Retail Finance II, LLC, as agent   NV   2003000345-8  
1/6/03   All assets. Hollywood Mail Order, LLC       NV   2003013915-2   6/21/03
  UCC-3 Assignment of filing no. 2003000345-8 to Wells Fargo Retail Finance II,
LLC as agent. Hollywood Mail Order, LLC       NV   2007038811-9   11/21/07  
UCC-3 Continuation of filing no. 2003000345-8

 

Schedules to Series A Preferred Stock Purchase Agreement

 

 

 

 

DEBTOR  

SECURED

PARTY/creditor

  STATE  

UCC or

filing

NUMBEr

 

FILING

DATE

  collateral Hollywood Mail Order, LLC       NV   2010030876-4   12/9/10   UCC-3
Amendment to filing no. 2003000345-8 changing Secured Party’s name to Wells
Fargo Bank, National Association. Hollywood Mail Order, LLC       NV  
2008034176-9   11/6/08   All assets. Hollywood Mail Order, LLC       NV  
2010030872-6   12/9/10   UCC-3 Amendment to filing no. 2008034176-9 changing
Secured Party’s name to Wells Fargo Bank, National Association. Hollywood Mail
Order, LLC       NV   2011025413-9   9/23/11   UCC-3 Assignment of filing no.
2008034176-9 to Wells Fargo Bank, National Association, as agent. Hollywood Mail
Order, LLC   Hilco Brands, LLC   NV   2010019451-9   8/3/10   All assets
Hollywood Mail Order, LLC   Hilco Brands, LLC   NV   2010029818-9   11/29/10  
UCC-3 Amendment to filing no. 2010019451-9 deleting from the collateral assets
relating to Debtor’s wholesale division. Hollywood Mail Order, LLC   Wells Fargo
Bank, National Association, as agent   NV   2011025412-7   9/23/11   All assets.

 

Schedules to Series A Preferred Stock Purchase Agreement

 

 

 

 

Schedule 2.17

Litigation Matters

 

 

Michelle Weber, on behalf of herself and all others similarly situated v.
Frederick’s of Hollywood, Inc., Case No. CGC-12-517909. On February 2, 2012, a
former California store employee filed a purported class action lawsuit in the
California Superior Court, County of San Francisco, naming Frederick’s of
Hollywood, Inc. (“Frederick’s) as a defendant. The complaint alleges, among
other things, violations of the California Labor Code, failure to pay overtime,
failure to provide meal and rest periods and termination compensation and
violations of California’s Unfair Competition Law. The complaint seeks, among
other relief, collective and class certification of the lawsuit (the class being
defined as all California retail store hourly employees), unspecified damages,
costs and expenses, including attorneys’ fees, and such other relief as the
Court might find just and proper. An answer to the Plaintiff’s first amended
complaint was filed on April 5, 2012. The case is in the discovery phase.

 

Schedules to Series A Preferred Stock Purchase Agreement

 

 

 

  

EXHIBIT C

 

FORM OF OPINION

 

GRAUBARD MILLER

The Chrysler Building

405 Lexington Avenue

New York, NY 10174-1901

 

                      May 23, 2012

 

TTG Apparel, LLC

287 Bowman Avenue

Purchase, New York 10577

Attention: Mike Tokarz

 

Re:Frederick’s of Hollywood Group Inc.

 

Ladies and Gentlemen:

 

This opinion is being furnished pursuant to Section 4.2 of the Series A
Preferred Stock Purchase Agreement (the “Agreement”), by and between Frederick’s
of Hollywood Group Inc., a New York corporation (the “Company”), and TTG
Apparel, LLC (the “Purchaser”). Capitalized terms used herein and not otherwise
defined shall have the respective meanings ascribed to them in the Agreement.

 

We have acted as counsel to the Company in connection with the preparation,
execution and delivery of the Agreement. As such counsel, we have examined and
are familiar with and have relied upon the following documents:

 

(a)the Restated Certificate of Incorporation and by-laws, each as amended to
date, of the Company;

 

 

(b)a copy of the Agreement, the Warrants and the Certificate of Amendment
(collectively, the “Transaction Documents”); and

 

 

(c)such other records of meetings, documents, instruments and certificates
(including but not limited to certificates of public officials and officers of
the Company) as we have considered necessary for purposes of this opinion.

 

In connection with the above listed items, we have assumed the genuineness of
all signatures and the authenticity of all documents submitted to us as
originals, the conformity to original documents of the documents submitted to us
as certified, fax or photostatic copies and the authenticity of the originals of
such latter documents. As to all questions of fact material to this opinion that
have not been independently established, we have relied upon the certificates of
officers of the Company and upon the representations and warranties of the
Company contained in the Agreement.

 

Based on the foregoing and upon such investigation as we have deemed necessary,
we give you our opinion as follows:

  

 

 

  

1.             The Company is a corporation duly organized under the laws of the
State of New York. The Company is validly existing in the State of New York

 

2.             The Company has the corporate power and authority to enter into
and perform its obligations under each of the Transaction Documents to which it
is a party. The Company has the corporate power and authority to own, lease and
operate its properties and to carry on its business as it is now conducted.

 

3.             Each of the Transaction Documents to which the Company is a party
have been duly authorized, executed and delivered by the Company.

 

4.             Each of the Transaction Documents to which the Company is a party
is a legally valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms except (i) as limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or
other laws of general application relating to or affecting the enforcement of
creditors’ rights generally, (ii) as limited by laws relating to the
availability of specific performance, injunctive relief, or other equitable
remedies, or (iii) to the extent indemnification provisions may be limited by
applicable federal or state securities laws.

 

5.             The shares of Series A Preferred Equity being purchased under the
Purchase Agreement are duly authorized and will be validly issued, fully paid
and nonassessable when paid for in accordance with the Purchase Agreement.

 

7.             The execution and delivery by the Company of each of the
Transaction Documents to which it is a party, and the performance by the Company
of its obligations thereunder, will not (a) violate the Restated Certificate or
by-laws of the Company, (b), to our knowledge, violate any federal or New York
law or governmental rule or regulation applicable to the Company, except as
would not have a Material Adverse Effect on the Company, or (c), to our
knowledge, require any consents, approvals or authorizations to be obtained by
the Company from, or any registrations, declarations or filings to be made by
the Company with, any Governmental Authority under any federal or New York
statute or regulation or the Business Corporation Law of the State of New York,
applicable to the Company on or prior to the date hereof, that have not been
obtained or made, except for filings pursuant to Regulation D of the Securities
Act, and applicable state securities laws.

 

9.             To our knowledge, the Company is not a party to, or expressly
bound by, any judgment, injunction or decree of any court or governmental
authority which would restrict or interfere with the performance by it of its
obligations under the Transaction Documents to which it is a party.

 

10.           Assuming the accuracy of the representations and warranties of the
Purchasers set forth in the Purchase Agreement, the offer and sale of the shares
of the Series A Preferred Equity under the terms and conditions set forth in the
Purchase Agreement, is exempt from the registration requirements of the
Securities Act of 1933, as amended.

 

No opinion is expressed herein other than as to the laws of the State of New
York and the federal securities laws of the United States of America.
Specifically, we express no opinion with respect to (i) the law of any other
state of the United States, and (ii) the law of any foreign country, including
any such law governing the issuance of securities in any such country.

 

 

 

 

Where an opinion is qualified by our knowledge as to a certain matter relating
to the Company, knowledge is deemed to be based on the actual knowledge of those
attorneys that are currently employed by this firm as of the date of this
opinion who have been actively engaged on matters for which we have been
employed by the Company.

 

This opinion is addressed solely to the Purchaser, and is being delivered to it.
This opinion is solely for the benefit of the Purchaser and may not be relied
upon in any manner by any other person.

 

Very truly yours,

 

/s/ GRAUBARD MILLER

  

 

 

 

EXHIBIT D

 

FORM OF WARRANT

  

See Exhibit 10.2 to Form 8-K