Key Developments For Blockbuster Inc.
Blockbuster Inc. (BBI.N) (New York Stock Exchange)
Eolas Technologies Inc. Files Infringement Lawsuit Against Blockbuster Inc. And Others
Eolas Technologies Inc. announced a Texas federal lawsuit filed to assert the company's intellectual property rights based on two patents, including one that has passed two separate reexaminations at the United States Patent and Trademark Office (USPTO) and resulted in a $565 million federal court judgment in 2004. The lawsuit, filed in the U.S. District Court for the Eastern District of Texas, includes claims related to two Eolas patents, U.S. Patent No. 5,838,906 (906 Patent) and U.S. Patent No. 7,599,985 (985 Patent). The companies named as defendants include Adobe Systems, Amazon.com; Apple Inc.; Argosy Publishing Inc.; Blockbuster Inc. ; CDW Corp.; Citigroup Inc.; eBay Inc.; Frito-Lay Inc. (a subsidiary of Purchase, PepsiCo Inc.); The Go Daddy Group Inc.; Google Inc.; J.C. Penney Co. Inc.; JPMorgan Chase & Co.; New Frontier Media Inc.; Office Depot Inc.; Perot Systems Corp.; Playboy Enterprises International Inc.; Rent-A-Center, Inc.; Staples, Inc.; Sun Microsystems Inc.; Texas Instruments ; Yahoo! Inc.; and YouTube LLC, a subsidiary of Google Inc.
Blockbuster Inc. Closes Offering Of $675 Million Of Senior Secured Notes Due 2014
Blockbuster Inc. announced that it has closed its previously announced offering of $675 million aggregate principal amount of 11.75% senior secured notes due 2014 at an issue price of 94.0%. J.P. Morgan Securities Inc. acted as the sole book-running manager of the Notes offering. The Company will use the net proceeds of the Notes offering to repay all indebtedness outstanding under the Company's revolving credit facility and Term Loan B, its revolving asset-based loan facility in Canada, fund fees and expenses of the transaction.
Blockbuster Inc. Enters Strategic Alliance With Cable Operators Suddenlink Communications and Mediacom Communications
Blockbuster Inc. announced a strategic alliance with cable broadband Multi-System Operators (MSOs) Suddenlink Communications and Mediacom Communications Corporation to set the stage for Blockbuster to bring its multichannel offering to Suddenlink and Mediacom customers. The alliance is scheduled to roll out in phases beginning in September in Suddenlink's Charleston, W. Va., and Mediacom's Des Moines, Ia., service areas. Initially, Blockbuster will team up with Suddenlink and Mediacom to broaden the appeal and recognition of each MSO's video on demand movie service, rebranding key aspects of their service under the BLOCKBUSTER brand.
Blockbuster Inc. Announces Pricing of $675 Million of Senior Secured Notes Due 2014
Blockbuster Inc. announced that it has priced an offering of $675 million aggregate principal amount (increased from $340 million, as announced on September 14, 2009) of 11.75% senior secured notes due 2014 at an issue price of 94.0%. The new Notes will be issued in a private offering that is exempt from the registration requirements of the Securities Act of 1933, as amended (the Securities Act), to qualified institutional buyers in accordance with Rule 144A and to persons outside the U.S. pursuant to Regulation S under the Securities Act of 1933, as amended. The new notes will be senior secured obligations and will be guaranteed by the Company's domestic subsidiaries. The Notes and the guarantees will be secured by first priority liens on substantially all of the Company's and the guarantors' assets. The sale of the new notes is expected to be consummated on or about October 1, 2009. Blockbuster plans to use the net proceeds of the Notes to repay all indebtedness outstanding under the Company's revolving credit facility and Term Loan B, and its revolving asset based loan facility in Canada, fund fees and expenses of the transaction and for general corporate purposes.
Blockbuster Inc. To Close As Many As 960 Stores By End Of 2010-DJ
Dow Jones reported that Blockbuster Inc. will close up to 960 stores by the end of next year as the Company looks to focus on its core stores and eliminate costs. The Company said that it will implement a proposed credit agreement amendment to extend the final maturity of a term loan and allow it to sell off non core international assets and complete planned store closures. The Company said it plans to close 810 to 960 stores by the end of next year, including 280 to 300 normal closures and 300 to 385 accelerated closures this year. It added 35% of its stores are considered core, while 47% are profitable non-core stores and 18% are unprofitable. The Company also said it will make more efforts to mitigate or end leases at another 275 to 300 stores and convert yet another 250 to 300 stores into outlets.
