TV/online shopping outfit ShopNBC has renewed its license agreement with NBC Universal for an additional year. Plus, it’s also gotten access to some more cash.
ShopNBC is a publicly traded company whose stock trades on Nasdaq as “VVTV,” a throwback to its original Value Vision name. It licenses the NBC name from NBC Universal, as a result of which NBCU owns about 20% of the ShopNBC common stock.
The existing license agreement, which was to expire in May 2011, has been extended to May 2012. As consideration to NBCU for the license extension, the ShopNBC will issue common stock in May of 2011 valued at $4 million. Additionally, the agreement allows for a one-year extension to May 2013 upon the mutual agreement of both parties. The license agreement covers the TV shopping network and the websites ShopNBC.com and ShopNBC.tv.
“We are pleased to have extended our use of the NBC trademark for another year,” said Keith Stewart, ShopNBC CEO. “Our ability to continue leveraging this well-known brand will allow our experienced multi-channel team to remain focused on our company goals of consistent profitability and long-term sustained growth. We are grateful to our partner and shareholder, NBCU, for their ongoing support.”
Also, ShopNBC announced that it has entered into $25 million term loan with a lending group led by Crystal Financial LLC. The loan has a five-year maturity, bears a variable interest rate, which will initially be set at 11%, and will be used to finance general working capital needs. The loan replaces a previous $20 million revolving credit facility, and is secured primarily by the company’s inventory and accounts receivable. The PrinceRidge Group served as financial advisors to the company.