Movie Gallery in jeopardy of DIP facility default after missing financial statement delivery deadline

By Caroline Salls

Pittsburgh, April 25 - Movie Gallery, Inc. was unable to comply with the requirement under its debtor-in-possession credit agreement to deliver its audited financial statements by April 21, according to an 8-K filed with the Securities and Exchange Commission.

The company has 30 days from April 21 to deliver the financial statements before an event of default occurs under the DIP facility.

Movie Gallery said it is working with its auditors to complete the audit for fiscal year 2007.

Movie Gallery, a Dothan, Ala.-based video rental company, filed for bankruptcy on Oct. 16, 2007 in the U.S. Bankruptcy Court for the Eastern District of Virginia. Its Chapter 11 case number is 07-33849.

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