Blockbuster, Inc Bk Court Date this Monday, Got Balls?

Blockbuster Inc. (BLOAQ, BLOBQ) Tuesday will seek final approval to  borrow on a $125 million loan from a group of its senior noteholders, who are poised to take control of the video-rental chain when it exits Chapter 11 protection.
The New York bankruptcy court last month granted the company permission to borrow up to $45 million on the loan pending final approval.
Blockbuster will use the loan to fund its Chapter 11 restructuring. It's also set to convert into exit financing when the company emerges from bankruptcy.
The proposed bankruptcy financing has drawn opposition from one of Blockbuster's junior noteholders, who said the company has ignored creditors who "aren't movie moguls." The noteholr, investment firm Lyme Regis Partners LLC, said the loan deal unfairly shields the lenders from litigation. Blockbuster, battered by intense competition from rivals such as Netflix Inc. (NFLX) and Coinstar Inc.'s (CSTR) Redbox, filed for bankruptcy protection on Sept. 23 after reaching a restructuring deal with more than 80% of its senior noteholders.
Under the deal, the senior noteholders, owed $630 million, would trade their debt The restructuring is expected to reduce Blockbuster's debt load to about $100 million from nearly $1 billion. The Dallas company hopes to exit Chapter 11 protection by the first quarter of 2011.