- Current report filing (8-K)
January 13 2010 - 5:01PM
Edgar (US Regulatory)
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): January 7, 2010
IMAGE ENTERTAINMENT,
INC.
(Exact name of registrant as
specified in its charter)
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Delaware
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000-11071
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84-0685613
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(State or other Jurisdiction of Incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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20525 Nordhoff Street, Suite
200, Chatsworth, California
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91311
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant’s telephone number,
including area code:
(818) 407-9100
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(Former name or former address if changed since last report.)
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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)
o
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))
1
Item 1.01. Entry into a
Material Definitive Agreement.
On January 7,
2010, Image Entertainment, Inc. (the “
Company
”) entered into
a Payoff Letter with Portside Growth and Opportunity Fund
(“
Portside
”), the holder of the Company’s senior
secured convertible note due 2011 in the principal amount of $15.7 million
(the “
Note
”). The Payoff Letter confirmed Portside’s
agreement that upon receipt of $15.0 million in cash (the “
Cash
Payment
”) and 3.5 million shares of the Company’s common
stock (the “
Payoff Shares
” and together with the Cash
Payment, the “
Payoff Amount
”) and execution of an exchange
agreement between the Company and Portside on the closing date of the issuance
of the initial shares of preferred stock of the Company contemplated by that
Securities Purchase Agreement between the Company, JH Partners, LLC and
affiliates of JH Partners (the “
SPA
”), all of the
obligations of the Company under the Note would be terminated and all security
interests and other liens granted to or held by Portside under the security
documents securing the Note would be forever satisfied, released and discharged
without further action. The Payoff Shares were to be issued to Portside in
exchange for $10,000 in principal amount of the Note pursuant to an exchange
agreement to be reasonably agreed between the Company and Portside.
The foregoing
description of the Payoff Letter does not purport to be complete and is
qualified in its entirety by reference to the Payoff Letter, which is filed as
Exhibit 10.1 hereto and is incorporated herein by reference.
Item 3.02 Unregistered Sales
of Equity Securities.
The information set
forth in Item 1.01 of this Current Report on Form 8-K is incorporated into
this Item 3.02 by reference.
The Payoff Shares
were issued to Portside on January 8, 2010 in an offering exempt from the
Securities Act registration requirements under Section 3(a)(9) of the
Securities Act (because the issuance involved an exchange by the Company with
its existing security holder exclusively and no commission or other
remuneration was paid or given, directly or indirectly, for soliciting the
exchange).
Item 5.02. Departures of
Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers.
Resignation of
Directors
Pursuant to the
closing conditions of the SPA, on January 7, 2010, each member of the
then-current board of directors of the Company (the
“
Board
”), which included Ira S. Epstein, Gary Haber, M.
Trevenen Huxley and Robert J. McCloskey, resigned from the Board effective
immediately after the closing of the issuance of the initial shares of
preferred stock of the Company pursuant to the SPA (the
“
Closing
”). The resignations were not the result of
any disagreement with the Company on any matter relating to the
Company’s operations, policies or practices.
Election of Directors
On January 7,
2010, the then-current Board appointed Theodore Green, Patrick Collins and
Michael John to the Board effective immediately after the Closing.
Mr. John will be the sole Class I director, Mr. Collins the sole
Class II director and Mr. Green the sole Class III director.
Each of the new directors was nominated by the Investors and elected by the
former Board pursuant to the closing conditions set forth in the SPA. The
information called for by Item 5.02(d)(3) of Form 8-K has not yet been
determined or is unavailable at the time of the filing of this Current Report
on Form 8-K. The Company will file an amendment to this Current Report on Form
8-K within four business days after the information called for by
Item 5.02(d)(3) is determined or becomes available.
2
The biographies for the new directors are as follows:
Theodore S.
(Ted) Green, Age 57
. Since 2007, Mr. Green has served as a
Director of China MediaExpress, a publicly traded company that operates the
largest television advertising network on inter-city express buses in
China. The Company is a successor to TM Entertainment and Media, Inc., a company Mr. Green served as Chairman and Co-CEO. From 2003 to 2006, Mr. Green was the CEO and Co-Owner of
Anchor Bay Entertainment, which at such time was the subsidiary of IDT
Entertainment, Inc. that focused on the production, marketing and distribution
of various media. Mr. Green began serving as CEO, with the
acquisition of Anchor Bay from The Handleman Company. Mr. Green had
full operating authority over the marketing, financial, sales, products,
operations, legal, business and corporate resources. Prior to that, in
2001, Mr. Green established Greenlight Consulting Inc., a project-based
consulting practice focused on the media and entertainment industry.
Greenlight Consulting’s clients include Sony Music and Vivendi-Universal
as well as numerous other regional media organizations. Prior to founding
Greenlight Consulting, in 2000, Mr. Green was President and Chief
Operating Officer of MaMaMedia, Inc., an Internet company that created
activity-based learning products for children and their families. From
1992 to 2000, Mr. Green was the founder and President of Sony Wonder, the
division of Sony BMG Music Entertainment responsible for the production and
distribution of media geared toward youthful audiences and also for all home
video distribution. Mr. Green was responsible for all creative,
production, operations, finance, marketing and business efforts.
Beginning in 1989, Mr. Green was the Executive Vice President of
Administration and Operations for ATCO Records, a music industry label co-owned
with The Warner Music Group. Mr. Green was responsible for all
business, legal and financial operations. From 1982 until 1989,
Mr. Green served as the Senior Vice President of Polygram Records,
overseeing the Business Affairs and Music Publishing divisions of the
company. Mr. Green was responsible for negotiations, administration,
rights and contracts. Mr. Green’s career in the entertainment
industry began first in the legal department and thereafter as the Director of
Business Affairs for CBS Records. Prior to that Mr. Green practiced
general entertainment law at the firm of Moses Singer.
Patrick M.
Collins, Age 35.
Mr. Collins is a senior investment professional
with JH Partners, LLC, where he has held various positions since 2003.
Mr. Collins is a member of JH Partners’ four member investment
committee and is responsible for leading deal teams in completing all phases of
the firm’s private equity investments, including sourcing, due diligence,
debt financing, valuation, structuring, negotiation and monitoring. Prior to
joining JH Partners, Mr. Collins worked at Behrman Capital, a private
equity firm. Prior to Behrman Capital, Mr. Collins was an investment
banker at Merrill Lynch & Co., Inc. Mr. Collins currently serves on
the boards of AmeriMark Holdings, LLC and CHP Holdings, Inc. Mr. Collins
received an MBA from Harvard Business School and a BA from Yale University.
Michael J. John,
Age 55
. Since April 2004, Mr. John has served as a senior partner
of JH Partners, LLC. Prior to joining JH Partners, LLC, Mr. John was
President and Chief Executive Officer of City Graphics, a private graphic
design company, from 1993 to 2003. Previously, Mr. John served as
President and Chief Executive Officer of Pacific Lithograph, a commercial
lithographer. Mr. John currently serves on the boards of the private
companies AmeriMark Holdings, LLC, BAP Holdings, LLC, Pikes Peak Direct
Marketing, Inc., Barmensen Inc. and Country Home Products, Inc. He received a
B.S. from the University of Oregon and also completed the Stanford Executive
Management Program.
In connection with
Amendment Number 2 to the SPA, the Company agreed to pay JH Partners, LLC or
its designee a management fee of $300,000 on each of December 31, 2010 and
December 31, 2011. JH Partners, LLC has directed that such fees be
paid to JH Evergreen Management, LLC. Messrs. Collins and John do
not have an interest in fees in excess of expenses of JH Evergreen Management,
LLC.
Directors who are
employees of the Company, such as Mr. Green, receive no additional or
special remuneration for serving as directors. Messrs. Collins and John,
both of whom are affiliated with JH Partners, will not receive compensation for
their service as directors. However, Messrs. Collins and John will be
reimbursed for reasonable travel expenses to attend Board or committee
meetings. Each of the new directors is also expected to enter into the standard
form of indemnification agreement between the Company and its directors. A copy
of this form agreement is filed as Exhibit 10.1 to the Company’s
Current Report on Form 8-K filed on October 24, 2005.
3
Item 5.03. Amendments to
Articles of Incorporation or Bylaws; Change in Fiscal Year.
On January 7,
2010, the Board approved an amendment to Section 3.1 of the
Company’s Bylaws (the “
Bylaw Amendment
”). The Bylaw
Amendment was to be effective immediately after the Closing. The Bylaw
Amendment changes the minimum number of directors on the Board from four to
three. The foregoing description of the Bylaw Amendment does not purport to be
complete and is qualified in its entirety by reference to the Bylaw Amendment,
which is filed as Exhibit 3.1 hereto and is incorporated herein by
reference.
Item 9.01. Financial
Statements and Exhibits.
(d) Exhibits.
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Exhibit Number
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Exhibit Description
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3.1
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Form of Amendment to the Bylaws of Image
Entertainment, Inc.
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10.1
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Payoff Letter between Image Entertainment, Inc. and Portside Growth and Opportunity Fund.
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4
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.
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Dated: January 13, 2010
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By:
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/s/ Michael B. Bayer
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Michael B. Bayer
Corporate Secretary
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5
EXHIBIT INDEX
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Exhibit No.
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Description
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3.1
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Form of Amendment to the Bylaws of Image
Entertainment, Inc.
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10.1
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Payoff Letter between Image Entertainment, Inc.
and Portside Growth and Opportunity Fund.
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6
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