September 15, 2009 (FinancialWire) — Blockbuster Inc., (NYSE: BBI) plans to offer up to $340 million of senior secured notes due 2014 in a private offering.

The company plans to use the proceeds of the notes to repay all indebtedness outstanding under its revolving credit facility and its revolving asset-based loan facility in Canada, fund fees and expenses of the transaction and for general corporate purposes.

Blockbuster also plans to pursue an amendment under its credit agreement, under which some of its term loan facility lenders be given the option to purchase notes in exchange for repayment of their loans, or to amend and extend the final maturity of their loans from August 20, 2011, to May 31, 2012.

The deal would include a revised loan amortization payment schedule and an increased applicable interest rate margin. The amendment would also include changes to the financial covenants and other terms.

Dallas-based Blockbuster is a provider of in-home movie and game entertainment. The company operates more than 7,000 stores throughout the Americas, Europe, Asia and Australia.

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