Hollywood Entertainment Meets, Stays on Nasdaq

The nation’s second-largest video rental chain narrowly avoided being kicked off the Nasdaq Stock Market, after the company succeeded in holding its shareholder meeting.

Hollywood Entertainment Corp. was threatened with being removed from the stock market after the company failed to hold its annual meeting last year. Company executives say the rental chain’s calendar was disrupted by the hostile takeover bid by the No. 1 chain, Dallas-based Blockbuster Inc.

Shareholders met near the company’s headquarters in Wilsonville, Ore., on March 30, satisfying the condition Nasdaq had placed on the corporation to avoid delisting. “One of the corporate governance standards that a company must comply with is having an annual shareholders meeting,” Nasdaq spokesman Wayne Lee said.

Larry Dennedy, a company spokesman, said the delay was caused by the heated merger negotiations, after Blockbuster last year launched a counter bid to an offer from Movie Gallery Inc. Blockbuster dropped its offer last month after it became clear that regulators would strike down a marriage.

Hollywood Entertainment shareholders are expected to vote on Movie Gallery’s $13.25-a-share offer April 22. Hollywood Entertainment shares closed at $13.32 on Thursday, up 6 cents, and Movie Gallery lost 35 cents to $28.55, also on Nasdaq.