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<P align="center" style="font-size: 14pt"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION<BR>
<FONT style="font-size: 12pt">Washington, D.C. 20549
</FONT></B>

<P align="center" style="font-size: 18pt"><B>FORM 8-K</B>

<P align="center" style="font-size: 12pt"><B>CURRENT REPORT<BR>
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</B>

<P align="center" style="font-size: 10pt"><B>Date of Report (Date of earliest event reported): November 20, 2008</B>

<P align="center">

<P align="center" style="font-size: 24pt"><B>IMAGE ENTERTAINMENT, INC.<BR></B>
<FONT style="font-size: 10pt">(Exact name of registrant as specified in its charter)
</FONT>

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    <TD width="32%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="33%">&nbsp;</TD>
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    <TD width="32%">&nbsp;</TD>
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    <TD style="border-bottom: 1px solid #000000"><B>Delaware</B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>000-11071</B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>84-0685613</B></TD>
</TR>
<TR valign="top">
    <TD>(State or other Jurisdiction of Incorporation)</TD>
    <TD>&nbsp;</TD>
    <TD>(Commission File Number)</TD>
    <TD>&nbsp;</TD>
    <TD>(IRS Employer Identification No.)</TD>
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    <TD width="49%">&nbsp;</TD>
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    <TD width="49%">&nbsp;</TD>
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    <TD style="border-bottom: 1px solid #000000"><B>20525 Nordhoff Street, Suite 200<BR>Chatsworth, California<BR></B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>91311-6104</B></TD>
</TR>
<TR valign="top">
    <TD>(Address of Principal Executive Offices)</TD>
    <TD>&nbsp;</TD>
    <TD>(Zip Code)</TD>
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<P align="center" style="font-size: 10pt">Registrant&#146;s telephone number, including area code: <B>(818) 407-9100</B>


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    <TD nowrap style="border-bottom: 1px solid #000000"><B>&nbsp;</B></TD>
</TR>
<TR>
    <TD nowrap>(Former name or former address if changed since last report.)</TD>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:

<P align="left" style="font-size: 10pt">
<FONT face="Wingdings">&#111;</FONT> Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)<BR><BR>
<FONT face="Wingdings">&#254;</FONT> Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)<BR><BR>
<FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))<BR><BR>
<FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))<BR>


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<P align="justify" style="font-size: 10pt"><B>Item&nbsp;1.01. Entry Into a Material Definitive Agreement.</B>


<P align="justify" style="font-size: 10pt"><U>The Merger Agreement</U>


<P align="justify" style="font-size: 10pt; text-indent: 4%">On November&nbsp;20, 2008, Image Entertainment, Inc., a Delaware corporation (the &#147;<U>Company</U>&#148;), entered into an
Agreement and Plan of Merger (the &#147;<U>Merger Agreement</U>&#148;) with Nyx Acquisitions, Inc., a Delaware corporation
(&#147;<U>Parent</U>&#148;), and The Conceived Group, Inc., a Delaware corporation and wholly owned subsidiary of Parent
(&#147;<U>Merger Sub</U>&#148;). Pursuant to the terms of the Merger Agreement, Merger Sub will merge with and into the Company
(the &#147;<U>Merger</U>&#148;), with the Company continuing as the surviving corporation and as a wholly owned subsidiary of
Parent.


<P align="justify" style="font-size: 10pt; text-indent: 4%">Pursuant to the terms of the Merger Agreement, at the effective time of the Merger (the &#147;<U>Effective Time</U>&#148;),
each outstanding share of common stock, par value $.0001 per share, of the Company (the &#147;<U>Shares</U>&#148;), other than
any shares owned by the Company, Parent, Merger Sub or any other subsidiary of Parent, or by any stockholders who are
entitled to and who properly exercise appraisal rights under Delaware law, shall be cancelled and shall be converted
automatically into the right to receive $2.75 in cash, without interest, less any withholding taxes.


<P align="justify" style="font-size: 10pt; text-indent: 4%">The Board of Directors of the Company has unanimously approved the Merger Agreement and has recommended that the
Company&#146;s stockholders vote in favor of adoption of the Merger Agreement.


<P align="justify" style="font-size: 10pt; text-indent: 4%">Consummation of the Merger is subject to the satisfaction or waiver of customary closing conditions, including (i)
the adoption of the Merger Agreement by the Company&#146;s stockholders, (ii)&nbsp;the absence of certain legal impediments to
the consummation of the Merger, and (iii)&nbsp;the expiration or termination of any required waiting periods under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976.


<P align="justify" style="font-size: 10pt; text-indent: 4%">The Company has made customary representations, warranties and covenants in the Merger Agreement, including
covenants regarding operation of the business of the Company prior to the Effective Time and covenants prohibiting the
Company from soliciting, or providing information or entering into discussions concerning, any Acquisition Proposal (as
defined in the Merger Agreement), except in limited circumstances relating to an unsolicited bona fide written
Acquisition Proposal that constitutes, or is reasonably expected to lead to, a Superior Proposal (as defined in the
Merger Agreement).


<P align="justify" style="font-size: 10pt; text-indent: 4%">The Merger Agreement provides that, upon termination under specified circumstances, the Company would be required
to pay $750,000 as a reimbursement of expenses incurred by Parent and Merger Sub in connection with the transactions
contemplated by the Merger Agreement. Upon termination in certain other specified circumstances, the Company would be
required to pay a termination fee of $1.8&nbsp;million to Parent, including compensation for efforts and resources expended
and opportunities forgone by Parent and Merger Sub in connection with the transactions contemplated by the Merger
Agreement. The Merger Agreement further provides that upon termination by the Company under specified circumstances
related to a breach of any representation, warranty, covenant or agreement on the part of the Parent or Merger Sub,
Parent would be required to pay to the Company a business interruption fee of $1.8&nbsp;million. In order to secure payment
of the business interruption fee, contemporaneously with the execution of the Merger Agreement, Parent made an initial
deposit of $500,000 into an account to be held in trust for payment to the Company, and will make a second deposit of
$1.3&nbsp;million within two days of the Company&#146;s filing of a definitive proxy statement with the Securities and Exchange
Commission.


<P align="justify" style="font-size: 10pt; text-indent: 4%">Parent has obtained an equity financing commitment for the transactions contemplated by the Merger Agreement, the
proceeds of which are sufficient to pay the aggregate merger consideration contemplated by the Merger Agreement.

<P align="center" style="font-size: 10pt; text-indent: 4%">&nbsp;

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<P align="justify" style="font-size: 10pt; text-indent: 4%">The foregoing summary of the Merger Agreement, and the transactions contemplated thereby, does not purport to be
complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, which is filed as
an exhibit hereto, and is incorporated into this Item&nbsp;1.01 by reference.


<P align="justify" style="font-size: 10pt"><B><I>Cautionary Statements Regarding the Merger Agreement</I></B>


<P align="justify" style="font-size: 10pt; text-indent: 4%"><I>The Merger Agreement is being filed as an exhibit to this Current Report on </I><I>Form 8-K</I><I> to provide investors and
security holders with information regarding its terms. It is not intended to provide any other factual information
about the Company, Parent, Merger Sub or their respective subsidiaries and affiliates. The representations, warranties
and covenants contained in the Merger Agreement were made only for purposes of that agreement and as of the specific
dates set forth therein, were solely for the benefit of the parties to the Merger Agreement, and may be subject to
limitation agreed upon by the contracting parties, including being qualified by confidential disclosures made for the
purposes of allotting contractual risk between the parties to the Merger Agreement instead of establishing these
matters as facts and also may be subject to standards of materiality deemed relevant to the contracting parties but
that differ from those matters that may be deemed material to investors. Investors are not third party beneficiaries
under the Merger Agreement and should not rely on the representations, warranties and covenants or any descriptions
thereof as characterizations of the actual state of facts or conditions of the Company, Parent or Merger Sub or any of
their respective subsidiaries or affiliates. In addition, the respective compliance dates for any such
representations, warranties and covenants vary, and thus any individual term or condition may not be relevant at any
particular time. Moreover, information concerning the subject matter of the representation and warranties may change
after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the Company&#146;s
public disclosure.</I>


<P align="justify" style="font-size: 10pt"><U>Voting Agreements</U>


<P align="justify" style="font-size: 10pt; text-indent: 4%">In connection with the Merger Agreement, and as required by Parent as a condition to its execution of the Merger
Agreement, on November&nbsp;20, 2008, certain stockholders of the Company entered into Voting Agreements with Parent and
Merger Sub (the &#147;<U>Voting Agreements</U>&#148;), pursuant to which the stockholders agreed, among other things, to vote
the Shares held by them in favor of adoption of the Merger Agreement. If the Merger Agreement is terminated in
accordance with its terms, the Voting Agreements will also terminate. The stockholders who have entered into Voting
Agreements owned, in the aggregate, approximately 38% of the outstanding Shares as of such date.


<P align="justify" style="font-size: 10pt; text-indent: 4%">The foregoing summary of the Voting Agreements, and the transactions contemplated thereby, does not purport to be
complete and is subject to, and qualified in their entirety by, the full text of the Voting Agreements, a form of which
is filed as an exhibit hereto, and is incorporated into this Item&nbsp;1.01 by reference.


<P align="justify" style="font-size: 10pt"><B><I>Important Legal Information</I></B>


<P align="justify" style="font-size: 10pt; text-indent: 4%"><I>In connection with the proposed transaction, Image Entertainment, Inc. will file a proxy statement with the
Securities and Exchange Commission. </I><B><I>Before making any voting or investment decision, investors and security holders of
Image Entertainment are urged to carefully read the entire proxy statement, when it becomes available, and any other
relevant documents filed with the Securities and Exchange Commission, as well as any amendments or supplements to those
documents, because they will contain important information about the proposed transaction. </I></B><I>A definitive proxy
statement will be sent to the stockholders of Image Entertainment in connection with the proposed transaction.
Investors and security holders may obtain a free copy of the proxy statement (when available) and other documents filed
by Image Entertainment at the Securities and Exchange Commission&#146;s web site at http://www.sec.gov. The proxy statement
and such other documents may also be obtained for free from Image Entertainment by directing such request to Image
Entertainment, Inc., 20525 Nordhoff Street, Suite&nbsp;200, Chatsworth, CA 91311, Attention: Michael Bayer, Corporate
Secretary, telephone: (818)&nbsp;407-9100.</I>

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<P align="center" style="font-size: 10pt; display: none">3
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<P align="justify" style="font-size: 10pt; text-indent: 4%"><I>Image Entertainment, its directors, executive officers and other members of its management, employees, and certain
other persons may be deemed to be participants in the solicitation of proxies from Image Entertainment stockholders in
connection with the proposed transaction. Information about the interests of Image Entertainment&#146;s participants in the
solicitation is set forth in Image Entertainment&#146;s proxy statements and Annual Reports on </I><I>Form 10-K</I><I>, previously filed
with the Securities and Exchange Commission, and will be included in the proxy statement relating to the transaction
when it becomes available.</I>


<P align="justify" style="font-size: 10pt"><B>Item&nbsp;3.03. Material Modifications to Rights of Security Holders.</B>


<P align="justify" style="font-size: 10pt; text-indent: 4%">Immediately prior to the execution of the Merger Agreement, the Company and the Rights Agent entered into
Amendment No.&nbsp;4. to Rights Agreement (the &#147;<U>Amendment</U>&#148;), which provides that neither the execution, delivery nor
performance of the Merger Agreement or the Voting Agreements will trigger certain provisions of the Rights Agreement.


<P align="justify" style="font-size: 10pt; text-indent: 4%">In particular, the Amendment provides the following: (i)&nbsp;none of Parent, Merger Sub, nor any of their respective
affiliates or associates, shall be deemed to be an Acquiring Person, (ii)&nbsp;none of Section&nbsp;11(a)(ii) Event, Section&nbsp;13
Event, Distribution Date, nor Share Acquisition Date (as each such term is defined in the Rights Agreement) shall be
deemed to have occurred, and (iii)&nbsp;no holder of any Rights shall be entitled to exercise such Rights under, or be
entitled to any rights pursuant to, any of Sections&nbsp;3(a), 7(a), 11(a) or 13 of the Rights Agreement, in any such case
by reason of (a)&nbsp;the announcement of the Merger, (b)&nbsp;the approval, execution or delivery of the Merger Agreement, (c)
the execution and delivery of the Voting Agreements or any amendments thereof, (d) &nbsp;the commencement or, the
consummation of, any of the transactions contemplated by the Merger Agreement, including the Merger, or (e)&nbsp;the
commencement or, the consummation of, any of the transactions contemplated by the Voting Agreements. The Amendment
also redefines the term &#147;Expiration Date&#148; to include the time immediately prior to the effective time of the Merger.


<P align="justify" style="font-size: 10pt; text-indent: 4%">The foregoing summary of the Amendment does not purport to be complete and is qualified in its entirety by
reference to the Amendment, which is filed as an exhibit hereto, and is incorporated into this Item&nbsp;3.03 by reference.


<P align="justify" style="font-size: 10pt"><B>Item&nbsp;8.01 Other Events.</B>


<P align="justify" style="font-size: 10pt; text-indent: 4%">On November&nbsp;20, 2008, the Company issued a press release announcing the execution of the Merger Agreement, which
is filed as an exhibit hereto and is incorporated into this Item&nbsp;8.01 by reference.


<P align="justify" style="font-size: 10pt"><B>Item&nbsp;9.01. Financial Statements and Exhibits.</B>


<P align="justify" style="font-size: 10pt">(d)&nbsp;Exhibits.

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    <TD width="8%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="87%">&nbsp;</TD>
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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">2.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Agreement and Plan of Merger, dated as of November&nbsp;20, 2008, among Nyx
Acquisitions, Inc., a Delaware corporation, The Conceived Group, Inc., a
Delaware corporation and a wholly-owned subsidiary of Parent, and Image
Entertainment, Inc., a Delaware corporation.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amendment No.&nbsp;4 to Rights Agreement, dated as of November&nbsp;20, 2008,
between Image Entertainment, Inc., a Delaware corporation, and
Computershare Trust Company, N.A. a Delaware corporation, as Rights
Agent.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">99.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Press release dated November&nbsp;20, 2008.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">99.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Form of Voting Agreement by and between Nyx Acquisitions, Inc., a
Delaware corporation, and certain stockholders of Image Entertainment,
Inc., a Delaware corporation.</TD>
</TR>
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<P align="center" style="font-size: 10pt"><B>SIGNATURE</B>



<P align="justify" style="font-size: 10pt; text-indent: 4%">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly authorized.


<P align="justify" style="font-size: 10pt; margin-left: 46%; font-size: 10pt"><B>IMAGE ENTERTAINMENT, INC.</B>


<P align="justify" style="font-size: 10pt">Dated: November&nbsp;21, 2008


<P align="justify" style="font-size: 10pt; margin-left: 46%; font-size: 10pt; margin-top: -11pt">By: <U><B>/</B>s/ MICHAEL B. BAYER&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
<BR>
Name Michael B. Bayer
<BR>
Title: Corporate Secretary

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<P align="center" style="font-size: 10pt"><B>EXHIBIT INDEX</B>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
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<TR valign="bottom">
    <TD width="12%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="83%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000"><B>Exhibit No.</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibit Description</B></TD>
</TR>

<!-- End Table Head -->
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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><BR>2.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><BR>Agreement and Plan of Merger, dated as of November&nbsp;20, 2008,
among Nyx Acquisitions, Inc., a Delaware corporation, The
Conceived Group, Inc., a Delaware corporation and a wholly-owned
subsidiary of Parent, and Image Entertainment, Inc., a Delaware
corporation.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><BR>4.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><BR>Amendment No.&nbsp;4 to Rights Agreement, dated as of November&nbsp;20,
2008, between Image Entertainment, Inc., a Delaware corporation,
and Computershare Trust Company, N.A. a Delaware corporation, as
Rights Agent.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><BR>99.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><BR>Press release dated November&nbsp;20, 2008.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><BR>99.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><BR>Form of Voting Agreement by and between Nyx Acquisitions,
Inc., a Delaware corporation, and certain stockholders of Image
Entertainment, Inc., a Delaware corporation.</TD>
</TR>
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</TABLE>
</DIV>


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{"company-data": {"conformed-name": "IMAGE ENTERTAINMENT INC", "cik": "0000216324", "assigned-sic": "7822", "irs-number": "840685613", "state-of-incorporation": "DE", "fiscal-year-end": "0331"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-11071", "film-number": "081207973"}, "business-address": {"street1": "20525 NORDHOFF STREET", "street2": "SUITE 200", "city": "CHATSWORTH", "state": "CA", "zip": "91311", "phone": "8184079100"}, "mail-address": {"street1": "20525 NORDHOFF STREET", "street2": "SUITE 200", "city": "CHATSWORTH", "state": "CA", "zip": "91311"}, "former-company": {"former-conformed-name": "KEY INTERNATIONAL FILM DISTRIBUTORS INC", "date-changed": "19830719"}}
Filed by Bowne Pure Compliance
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 20, 2008
IMAGE ENTERTAINMENT, INC.
(Exact name of registrant as specified in its charter)
Delaware
000-11071
84-0685613
(State or other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
20525 Nordhoff Street, Suite 200
Chatsworth, California
91311-6104
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code:
(818) 407-9100
(Former name or former address if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
þ
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry Into a Material Definitive Agreement.
The Merger Agreement
On November 20, 2008, Image Entertainment, Inc., a Delaware corporation (the "
Company
"), entered into an
Agreement and Plan of Merger (the "
Merger Agreement
") with Nyx Acquisitions, Inc., a Delaware corporation
("
Parent
"), and The Conceived Group, Inc., a Delaware corporation and wholly owned subsidiary of Parent
("
Merger Sub
"). Pursuant to the terms of the Merger Agreement, Merger Sub will merge with and into the Company
(the "
Merger
"), with the Company continuing as the surviving corporation and as a wholly owned subsidiary of
Parent.
Pursuant to the terms of the Merger Agreement, at the effective time of the Merger (the "
Effective Time
"),
each outstanding share of common stock, par value $.0001 per share, of the Company (the "
Shares
"), other than
any shares owned by the Company, Parent, Merger Sub or any other subsidiary of Parent, or by any stockholders who are
entitled to and who properly exercise appraisal rights under Delaware law, shall be cancelled and shall be converted
automatically into the right to receive $2.75 in cash, without interest, less any withholding taxes.
The Board of Directors of the Company has unanimously approved the Merger Agreement and has recommended that the
Company's stockholders vote in favor of adoption of the Merger Agreement.
Consummation of the Merger is subject to the satisfaction or waiver of customary closing conditions, including (i)
the adoption of the Merger Agreement by the Company's stockholders, (ii) the absence of certain legal impediments to
the consummation of the Merger, and (iii) the expiration or termination of any required waiting periods under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976.
The Company has made customary representations, warranties and covenants in the Merger Agreement, including
covenants regarding operation of the business of the Company prior to the Effective Time and covenants prohibiting the
Company from soliciting, or providing information or entering into discussions concerning, any Acquisition Proposal (as
defined in the Merger Agreement), except in limited circumstances relating to an unsolicited bona fide written
Acquisition Proposal that constitutes, or is reasonably expected to lead to, a Superior Proposal (as defined in the
Merger Agreement).
The Merger Agreement provides that, upon termination under specified circumstances, the Company would be required
to pay $750,000 as a reimbursement of expenses incurred by Parent and Merger Sub in connection with the transactions
contemplated by the Merger Agreement. Upon termination in certain other specified circumstances, the Company would be
required to pay a termination fee of $1.8 million to Parent, including compensation for efforts and resources expended
and opportunities forgone by Parent and Merger Sub in connection with the transactions contemplated by the Merger
Agreement. The Merger Agreement further provides that upon termination by the Company under specified circumstances
related to a breach of any representation, warranty, covenant or agreement on the part of the Parent or Merger Sub,
Parent would be required to pay to the Company a business interruption fee of $1.8 million. In order to secure payment
of the business interruption fee, contemporaneously with the execution of the Merger Agreement, Parent made an initial
deposit of $500,000 into an account to be held in trust for payment to the Company, and will make a second deposit of
$1.3 million within two days of the Company's filing of a definitive proxy statement with the Securities and Exchange
Commission.
Parent has obtained an equity financing commitment for the transactions contemplated by the Merger Agreement, the
proceeds of which are sufficient to pay the aggregate merger consideration contemplated by the Merger Agreement.
The foregoing summary of the Merger Agreement, and the transactions contemplated thereby, does not purport to be
complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, which is filed as
an exhibit hereto, and is incorporated into this Item 1.01 by reference.
Cautionary Statements Regarding the Merger Agreement
The Merger Agreement is being filed as an exhibit to this Current Report on
Form 8-K
to provide investors and
security holders with information regarding its terms. It is not intended to provide any other factual information
about the Company, Parent, Merger Sub or their respective subsidiaries and affiliates. The representations, warranties
and covenants contained in the Merger Agreement were made only for purposes of that agreement and as of the specific
dates set forth therein, were solely for the benefit of the parties to the Merger Agreement, and may be subject to
limitation agreed upon by the contracting parties, including being qualified by confidential disclosures made for the
purposes of allotting contractual risk between the parties to the Merger Agreement instead of establishing these
matters as facts and also may be subject to standards of materiality deemed relevant to the contracting parties but
that differ from those matters that may be deemed material to investors. Investors are not third party beneficiaries
under the Merger Agreement and should not rely on the representations, warranties and covenants or any descriptions
thereof as characterizations of the actual state of facts or conditions of the Company, Parent or Merger Sub or any of
their respective subsidiaries or affiliates. In addition, the respective compliance dates for any such
representations, warranties and covenants vary, and thus any individual term or condition may not be relevant at any
particular time. Moreover, information concerning the subject matter of the representation and warranties may change
after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the Company's
public disclosure.
Voting Agreements
In connection with the Merger Agreement, and as required by Parent as a condition to its execution of the Merger
Agreement, on November 20, 2008, certain stockholders of the Company entered into Voting Agreements with Parent and
Merger Sub (the "
Voting Agreements
"), pursuant to which the stockholders agreed, among other things, to vote
the Shares held by them in favor of adoption of the Merger Agreement. If the Merger Agreement is terminated in
accordance with its terms, the Voting Agreements will also terminate. The stockholders who have entered into Voting
Agreements owned, in the aggregate, approximately 38% of the outstanding Shares as of such date.
The foregoing summary of the Voting Agreements, and the transactions contemplated thereby, does not purport to be
complete and is subject to, and qualified in their entirety by, the full text of the Voting Agreements, a form of which
is filed as an exhibit hereto, and is incorporated into this Item 1.01 by reference.
Important Legal Information
In connection with the proposed transaction, Image Entertainment, Inc. will file a proxy statement with the
Securities and Exchange Commission.
Before making any voting or investment decision, investors and security holders of
Image Entertainment are urged to carefully read the entire proxy statement, when it becomes available, and any other
relevant documents filed with the Securities and Exchange Commission, as well as any amendments or supplements to those
documents, because they will contain important information about the proposed transaction.
A definitive proxy
statement will be sent to the stockholders of Image Entertainment in connection with the proposed transaction.
Investors and security holders may obtain a free copy of the proxy statement (when available) and other documents filed
by Image Entertainment at the Securities and Exchange Commission's web site at http://www.sec.gov. The proxy statement
and such other documents may also be obtained for free from Image Entertainment by directing such request to Image
Entertainment, Inc., 20525 Nordhoff Street, Suite 200, Chatsworth, CA 91311, Attention: Michael Bayer, Corporate
Secretary, telephone: (818) 407-9100.
Image Entertainment, its directors, executive officers and other members of its management, employees, and certain
other persons may be deemed to be participants in the solicitation of proxies from Image Entertainment stockholders in
connection with the proposed transaction. Information about the interests of Image Entertainment's participants in the
solicitation is set forth in Image Entertainment's proxy statements and Annual Reports on
Form 10-K
, previously filed
with the Securities and Exchange Commission, and will be included in the proxy statement relating to the transaction
when it becomes available.
Item 3.03. Material Modifications to Rights of Security Holders.
Immediately prior to the execution of the Merger Agreement, the Company and the Rights Agent entered into
Amendment No. 4. to Rights Agreement (the "
Amendment
"), which provides that neither the execution, delivery nor
performance of the Merger Agreement or the Voting Agreements will trigger certain provisions of the Rights Agreement.
In particular, the Amendment provides the following: (i) none of Parent, Merger Sub, nor any of their respective
affiliates or associates, shall be deemed to be an Acquiring Person, (ii) none of Section 11(a)(ii) Event, Section 13
Event, Distribution Date, nor Share Acquisition Date (as each such term is defined in the Rights Agreement) shall be
deemed to have occurred, and (iii) no holder of any Rights shall be entitled to exercise such Rights under, or be
entitled to any rights pursuant to, any of Sections 3(a), 7(a), 11(a) or 13 of the Rights Agreement, in any such case
by reason of (a) the announcement of the Merger, (b) the approval, execution or delivery of the Merger Agreement, (c)
the execution and delivery of the Voting Agreements or any amendments thereof, (d)  the commencement or, the
consummation of, any of the transactions contemplated by the Merger Agreement, including the Merger, or (e) the
commencement or, the consummation of, any of the transactions contemplated by the Voting Agreements. The Amendment
also redefines the term "Expiration Date" to include the time immediately prior to the effective time of the Merger.
The foregoing summary of the Amendment does not purport to be complete and is qualified in its entirety by
reference to the Amendment, which is filed as an exhibit hereto, and is incorporated into this Item 3.03 by reference.
Item 8.01 Other Events.
On November 20, 2008, the Company issued a press release announcing the execution of the Merger Agreement, which
is filed as an exhibit hereto and is incorporated into this Item 8.01 by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
2.1
Agreement and Plan of Merger, dated as of November 20, 2008, among Nyx
Acquisitions, Inc., a Delaware corporation, The Conceived Group, Inc., a
Delaware corporation and a wholly-owned subsidiary of Parent, and Image
Entertainment, Inc., a Delaware corporation.
4.1
Amendment No. 4 to Rights Agreement, dated as of November 20, 2008,
between Image Entertainment, Inc., a Delaware corporation, and
Computershare Trust Company, N.A. a Delaware corporation, as Rights
Agent.
99.1
Press release dated November 20, 2008.
99.2
Form of Voting Agreement by and between Nyx Acquisitions, Inc., a
Delaware corporation, and certain stockholders of Image Entertainment,
Inc., a Delaware corporation.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly authorized.
IMAGE ENTERTAINMENT, INC.
Dated: November 21, 2008
By:
/
s/ MICHAEL B. BAYER
Name Michael B. Bayer
Title: Corporate Secretary
EXHIBIT INDEX
Exhibit No.
Exhibit Description
2.1
Agreement and Plan of Merger, dated as of November 20, 2008,
among Nyx Acquisitions, Inc., a Delaware corporation, The
Conceived Group, Inc., a Delaware corporation and a wholly-owned
subsidiary of Parent, and Image Entertainment, Inc., a Delaware
corporation.
4.1
Amendment No. 4 to Rights Agreement, dated as of November 20,
2008, between Image Entertainment, Inc., a Delaware corporation,
and Computershare Trust Company, N.A. a Delaware corporation, as
Rights Agent.
99.1
Press release dated November 20, 2008.
99.2
Form of Voting Agreement by and between Nyx Acquisitions,
Inc., a Delaware corporation, and certain stockholders of Image
Entertainment, Inc., a Delaware corporation.