Exhibit 99.1
BTP Acquisition Company LLC
IEAC, Inc.
February 6, 2008
Image
Entertainment, Inc.
20525 Nordhoff Street
Suite 200
Chatsworth, CA 91311
Attn: Marty Greenwald
Manatt,
Phelps & Phillips, LLP
11355 West Olympic Blvd.
Los Angeles, CA 90064
Attention: Gordon M. Bava, Esq.
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Merger Agreement — Image /
BTP
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Dear
Mr. Greenwald:
This letter
constitutes notice by BTP Acquisition Company, LLC
(“BTP”) and IEAC Inc., to Image Entertainment Inc.
(“Image”) in response to Image’s letter of
February 5, 2008, in which Image purport’s to terminate
the Amended and Restated Agreement and Plan of Merger among BTP.
IEAC and Image dated as of June 27, 2007 (as amended to date,
the “Merger Agreement”). Image is hereby advised as
follows:
1. Image
is not entitled to terminate the Merger Agreement pursuant to
Section 7.01(f) thereof, as such section provides that
“[Image] shall not have the right to terminate this
Agreement pursuant to this Section 7.01(f) if [BTP] is then
entitled to terminate this Agreement pursuant to
Section 7.01(d) or Section 7.01(e).” [emphasis
added] BTP was and remains entitled to terminate the Agreement
pursuant to Section 7.01(e), as set forth in Notices
previously sent by BTP to Image, including notices and
correspondence dated January 22, 2008; January 25, 2008;
January 30, 2008; February 1, 2008; and February 5,
2008, all of which are incorporated herein by this reference.
Accordingly, Image has no right to terminate the Merger Agreement
pursuant to Section 7.01(f).
2. Image
also cannot terminate the Merger Agreement pursuant to
Section 7.01(f) thereof, as the Merger Agreement had already
been terminated by BTP pursuant to Section 7.01(e) of the
Merger Agreement before Image purported to effect such termination.
BTP notifi
