Blue Holdings, Inc. Signs Licensing Agreement for Antik Denim to Cover All Knit Categories.

COMMERCE, Calif. -- Blue Holdings, Inc. (NASDAQ:BLUE), a designer, manufacturer and distributor of high-end fashion jeans, denim apparel and contemporary knits, today announced that it has signed a licensing agreement with North Star Apparel Corporation to further diversify the Antik Denim product mix into a broader lifestyle collection and extend the brand's reach.

The deal will have an initial five year term, with the first year considered to be comprised of 18 months, with five one-year renewable options if no defaults remain uncured at the time of the exercise of any renewal option. The agreement covers the following key territories: United States, Japan, Korea, China, Canada, United Kingdom, Italy, France, Germany, Spain, Australia and Mexico. Under the terms of the agreement, North Star Apparel will license the worldwide rights to sell Antik branded products for all knit categories.

The agreement provides for an upfront license fee of $180,000 and minimum royalty payments of 4.5% percent of all net sales of licensed products up to $4 million of net sales for the first year, and 10% of all net sales thereafter, and 10% of all net sales for each remaining year of the term and any renewal term. The agreement was signed to be effective October 1, 2006.

North Star Apparel was founded by Serge Benat to license and exploit premium fashion brands on a global basis. Mr. Benat has over 25 years of licensing experience, and has owned and operated flagship stores for both Gucci Group and Max Mara. In addition, Mr. Benat currently owns and operates the Pacific Connections Group which has re-created over 300 original Oleg Cassini sketches to create wardrobe replicas as part of its heritage collections.

Paul Guez, Chairman, Chief Executive Officer and President of Blue Holdings, Inc., said, "We are extremely excited to partner with Serge and North Star Apparel. We are confident in his team and their ability to successfully grow and expand the Antik brand. By developing unique Antik-branded knit products we will continue to execute our strategy of creating a premium lifestyle brand."

About Blue Holdings Inc.

Blue Holdings, Inc., directly and through its wholly owned subsidiaries, Antik Denim, LLC and Taverniti So Jeans, LLC, designs, develops, manufactures, markets, distributes and sells high-end fashion jeans, apparel, and accessories under the "Antik Denim," "Yanuk," "Taverniti So Jeans," and "Life and Death" brands, both in the United States and internationally. Blue Holdings currently sells men's, women's and children's styles. Antik Denim, Yanuk, Taverniti So, and Life and Death jeans and apparel are made from high-quality fabrics milled in the United States, Japan, Italy and Spain, and are processed with cutting-edge treatments and finishes. Blue Holdings' concepts, designs, embellishments, patent-pending pockets and great attention to detail and quality give it a competitive advantage in the high-end fashion jeans market.

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