Hollywood Video Faces Nasdaq Delisting7 Jan, 2005 By: Holly J. Wagner
Hollywood Entertainment Corp. is in danger of being delisted from the Nasdaq stock exchange because the company did not have an annual shareholders' meeting in 2004 as regulations require.
The company reported that it did not have the annual meeting because it was waiting for a planned transaction that would take the company private, which would have necessitated a special shareholders' meeting to approve the transaction with Leonard Green & Partners, L.P. The special shareholders' meeting was delayed when a bidding war that includes Blockbuster Video and Movie Gallery broke out.
Hollywood received a letter from the Nasdaq Stock Market Jan. 3 warning that it had fallen out of compliance with Marketplace Rules 4350(e) and 4350(g) requiring that the company hold an annual shareholder meeting in 2004 and solicit proxies for that meeting, according to a press release.
Hollywood securities are subject to delisting from The Nasdaq National Market at the opening of business on Jan. 12. The company has requested a hearing before a Nasdaq Listing Qualifications Panel to review the staff's determination and, under Nasdaq rules, the delisting of Hollywood's securities will be stayed pending the panel's decision.
“Hollywood is prepared to take any steps required by Nasdaq to avoid delisting," said a company statement. "Nevertheless, the Nasdaq hearing panel may not grant Hollywood's request for continued listing."
Hollywood stock closed before the announcement Friday at $13.05 per share.