Parker -- famous for playing Carrie Bradshaw in "Sex and the City" -- will receive a payout of more than $3 million in exchange for her ownership stake in the flailing fashion label, as well as an exit from the remainder of her contract as a Halston designer.
Weinstein is also opting out, selling his stake in Halston, which had approached 10 percent, for between $1 million and $1.5 million, as the company finalizes a restructuring of its mounting debt load that could be announced as soon as Friday, sources said.
Those sums, while tidy by the standards of a struggling fashion brand, are paltry compared with what Parker and Weinstein had hoped to reap by returning Halston to the prominence it enjoyed in the 70s and 80s.
"I was very interested in pursuing a diversified business model that went beyond entertainment and my involvement in Halston reflected that," Weinstein said. "But over the past year or so, I realized that I wanted to concentrate my energies on entertainment."
Parker, who had been designing a lower-price line called Halston Heritage, is ditching a contract that had entitled her to almost $10 million over the next three and a half years, according to one source close to the actress.
"Sarah felt that she has the opportunity to do a lot more with herself, and make a lot more money in the process if she goes elsewhere," according to the source, who added, "She was tired of all the conflict."
Fashion sources said Halston has been rocked this year by arguments between Weinstein and executives at Hilco, a Chicago-based liquidation firm that took control of Halston in 2007 in a $25 million buyout.
"There have been a lot of screaming matches," a Halston insider said. "They really couldn't agree on too much -- the management team, expenses, the company's structure."
Reached by phone Thursday, chief financial officer Jeff Green declined to comment, and Hilco officials did not respond to requests for comment.