Hollywood Media to Acquire Studio Systems

Posted on June 25, 2004

Hollywood Media Corp., a provider of news, information and ticketing covering the entertainment and media industries, has signed an agreement to acquire Studio Systems, Inc. Based in Los Angeles, Studio Systems provides database and information services to the entertainment industry. Studio Systems will be integrated with Hollywood Media Corp.'s Baseline/FilmTracker subsidiary. The agreed terms for the acquisition include Hollywood Media Corp.'s aggregate cash payments of approximately $4.5 million and issuance of shares of Hollywood Media Corp.'s common stock valued at $250,000 (based on recent market prices).

"We believe the anticipated enhancements and improvements represented by the integration of these companies' databases and businesses constitute a promising opportunity to create additional value for our stockholders," said Mitchell Rubenstein, Chairman and CEO of Hollywood Media Corp. "We anticipate a positive impact on annual operating profits resulting from the acquisition, following a transition period of approximately 3 to 5 months. Studio Systems is similar to Baseline/FilmTracker in that it has recurring subscription revenues and high customer retention, which provide stability and predictable revenues if current trends continue as expected."

The combined company, to be called Baseline StudioSystems, will continue to offer the existing product lines of both companies, including Baseline's Silver and Platinum InfoSource databases, FilmTracker, The Studio System, InHollywood and ScriptLog. Baseline StudioSystems will provide access to millions of data records on more than 1.5 million entertainment professionals, 10,000 projects in various stages of development and production, 150,000 released films and TV shows, 10,000 biographies, contact and representation information for over 100,000 industry professionals, and over 20 years of extensive box office and film cost estimates.

"This acquisition will give Hollywood Media Corp. the leading position in the entertainment database industry," sid Baseline President, Rafi Gordon. "The two companies are extremely complementary, with each bringing distinct customer bases, unique product features and specific core competencies. The combined entity will provide dramatically enhanced features to the larger combined roster of customers, while maintaining a user-friendly interface for our customers. We are excited to provide new applications, unparalleled access to an immense amount of data, and enhanced functionality for our customers."

Following the closing, StudioSystems' customers will have access to additional Baseline/FilmTracker services and data including research services, expanded customer support, additional archival film and television data, increased financial film data, and detailed biographical information. No changes are planned to StudioSystems' user interface. Baseline customers will have access to additional data from StudioSystems including television household ratings and international box office data by territory, and applications including StudioSystems' ScriptLog.