Wiedermal Realsatire pur
August 27, 2003
Hollywood's Buying Back Stock, and Its Chief Is Selling
By FLOYD NORRIS
Hollywood Entertainment, which runs the Hollywood Video chain of stores, wants to buy back at least $30 million worth
of its shares. Its chairman and chief executive, Mark J. Wattles, wants to sell almost as much.
Mr. Wattles said today that the company's credit lines had been amended to permit a stock buyback, and Hollywood's board
then approved the purchase of at least $30 million of stock, an amount that could rise to $40 million by the end of 2003 if the
company performs as expected.
Hollywood said it began its purchases by buying 114,000 shares on Tuesday. That amounted to about 20 percent of the
Nasdaq volume in Hollywood that day.
On May 23, Mr. Wattles embarked on a yearlong program to sell shares. He is selling 6,200 shares of stock each day the
market is open, a program that will result in the sale of 1,555,000 shares during the year. At today's closing price of $17.43,
up 45 cents, those shares would be worth about $27 million.
In a telephone interview, Mr. Wattles said there was no connection between his sales and the company's purchases.
"The company has excess cash," he said. "The founder has no cash."
Last year, Mr. Wattles was paid $1,688,340 in salary and bonus by Hollywood.
Mr. Wattles, 43, said he had a wife and five children, two of whom are in college, and wanted to put some money "in the
mattress" for safety. "It is just a prudent thing to do," he said.
Mr. Wattles noted that the planned sales amounted to only 20 percent of his stock in the company, and that he would remain
heavily invested in it.
As the company's founder, Mr. Wattles owns a lot of stock from before Hollywood Entertainment went public, but those
shares do not account for nearly all of his position. In 2001, when he resumed his position as president of Hollywood, he was
given three million shares by the board, along with options to buy three million more shares at $1.09 each.
Mr. Wattles noted that at that time the company was in financial difficulty, in part because of the money it had spent on a
subsidiary, Reel.com, a movie-oriented Web site, that he ran as chief executive from 1998 through 2000. Hollywood's plans
to take that subsidiary public were ended by the bursting of the Internet bubble, and it now operates at a much smaller scale
than before.
Mr. Wattles said the stock sales that began in May were the first he had made since 1994.
August 27, 2003
Hollywood's Buying Back Stock, and Its Chief Is Selling
By FLOYD NORRIS
Hollywood Entertainment, which runs the Hollywood Video chain of stores, wants to buy back at least $30 million worth
of its shares. Its chairman and chief executive, Mark J. Wattles, wants to sell almost as much.
Mr. Wattles said today that the company's credit lines had been amended to permit a stock buyback, and Hollywood's board
then approved the purchase of at least $30 million of stock, an amount that could rise to $40 million by the end of 2003 if the
company performs as expected.
Hollywood said it began its purchases by buying 114,000 shares on Tuesday. That amounted to about 20 percent of the
Nasdaq volume in Hollywood that day.
On May 23, Mr. Wattles embarked on a yearlong program to sell shares. He is selling 6,200 shares of stock each day the
market is open, a program that will result in the sale of 1,555,000 shares during the year. At today's closing price of $17.43,
up 45 cents, those shares would be worth about $27 million.
In a telephone interview, Mr. Wattles said there was no connection between his sales and the company's purchases.
"The company has excess cash," he said. "The founder has no cash."
Last year, Mr. Wattles was paid $1,688,340 in salary and bonus by Hollywood.
Mr. Wattles, 43, said he had a wife and five children, two of whom are in college, and wanted to put some money "in the
mattress" for safety. "It is just a prudent thing to do," he said.
Mr. Wattles noted that the planned sales amounted to only 20 percent of his stock in the company, and that he would remain
heavily invested in it.
As the company's founder, Mr. Wattles owns a lot of stock from before Hollywood Entertainment went public, but those
shares do not account for nearly all of his position. In 2001, when he resumed his position as president of Hollywood, he was
given three million shares by the board, along with options to buy three million more shares at $1.09 each.
Mr. Wattles noted that at that time the company was in financial difficulty, in part because of the money it had spent on a
subsidiary, Reel.com, a movie-oriented Web site, that he ran as chief executive from 1998 through 2000. Hollywood's plans
to take that subsidiary public were ended by the bursting of the Internet bubble, and it now operates at a much smaller scale
than before.
Mr. Wattles said the stock sales that began in May were the first he had made since 1994.
