1. MOVIE GALLERY INC WKN: 895026

Movie Gallery details plan for exiting bankruptcy
Sacramento Business Journal - by Portland Business Journal

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Movie Gallery Inc. said it could emerge from bankruptcy in the second quarter under a reorganization plan filed last week.

Dothan, Ala.-based Movie Gallery Inc. (Pink Sheets: MOVIQ) acquired Wilsonville-based Hollywood Entertainment Corp. for $1.3 billion in 2005. The company filed for bankruptcy protection in U.S. Bankruptcy Court for the Eastern District of Virginia this fall.

Movie Gallery has about 20 Hollywood Video stores in the Sacramento region.

The reorganization plan filed Dec. 22 is endorsed by its leading creditor, Sopris Capital Advisors LLC, which is the largest holder of Movie Gallery's senior notes and well as a substantial holder of claims under its second lien credit agreement. Too, a steering committee of creditors, has agreed to the plan.

As earlier disclosed, the reorganization plan would cancel existing shares of Movie Gallery's common stock, giving significant equity to Sopris. Once traded at more than $33 a share on Nasdaq, Movie Gallery was subsequently delisted and trades for about 7 cents on the Pink Sheets.

The plan would:

* Convert the company's $325 million 11 percent senior notes and general unsecured claim into new equity of the reorganized company.
* Convert about $72 million of Movie Gallery's $175 million second lien indebtedness, which is held by Sopris, into equity of the reorganized company.
* The company's first lien indebtedness would remain but on restructured terms.
* Its second lien debt would also remain in place.
* Sopris would commit to make a $50 million equity rights offering available to holders of the senior notes.

The full plan is available for review at: kccllc.net/moviegallery.

Movie Gallery will ask the court to confirm the plan early in the second quarter of and plans to emerge from bankruptcy shortly thereafter.



 

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Deutsche Handelsplätze (EUR)  
Frankfurt  0,028  +40,00    +0,0080  13:39   37.038  0,027  0,028  35.715  7.142  
Berlin  0,044  +0,00    +0,00  23.11.  2.500  0,266  0,89  3.000  0  
Internationale Handelsplätze  
OTC (USD)  0,055  +37,50    +0,0150  21:50   -  -  -  -  374.774