Moody's cuts Movie Gallery

Moody's Investors Service said it downgraded Movie Gallery Inc.'s long term credit ratings, including its corporate family rating to C from Caa3.

The outlook is stable.

The downgrade follows the company's announcement that on Sept. 10, it did not make the interest payment due on its second lien term loan and that the company has decided to defer the payment of the interest due to beyond the applicable grace period, the agency said.

As a result of the missed payment, effective Sept. 15, an event of default was triggered under the company's first lien credit agreement, second lien credit agreement and its 11% senior notes indenture, the agency added.

Moody's said that the following ratings are downgraded: probability of default rating to D from Caa2; $100 million senior secured revolving credit facility to Caa1 (LGD2, 18%) from B2 (LGD2, 18%); $25 million synthetic letter of credit facility to Ca (LGD4, 55%) from Caa2 (LGD4, 55%); $600 million first lien term loan to Ca (LGD4, 55%) from Caa2 (LGD4, 55%); $175 million second lien term loan to C (LGD5, 81%) from Caa3 (LGD5, 81%) and senior unsecured notes to C (LGD6, 95%) from Ca (LGD6, 95%).

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.