**EXHIBIT 10.19**

 

**AMENDMENT NUMBER 4 TOSECURITIES PURCHASE AGREEMENT**

 

This Amendment Number 4 to Securities PurchaseAgreement, dated March 8, 2010 (the “Amendment”), is by and betweenImage Entertainment, Inc., a Delaware corporation (the “Company”),JH Partners, LLC, as the Investor Representative, and the severalInvestors listed on Schedule 1 to the Securities Purchase Agreement datedDecember 21, 2009, as amended December 24, 2009, December 30,2009 and January 20, 2010 (the “Purchase Agreement”).

 

WHEREAS, the parties wish to amend certainprovisions of the Purchase Agreement.

 

NOW THEREFORE, the parties hereto agree as follows:

 

1.                                     Capitalizedterms used herein without definition have the meanings ascribed to them in thePurchase Agreement.

 

2.                                     The secondWHEREAS clause of the Purchase Agreement is hereby amended to read in itsentirety as follows:

 

WHEREAS, in connection with such purchase and sale,the Company has agreed to grant to the Investors the right, under certaincircumstances, to purchase up to an additional 7,400 shares of the Series BPreferred and 66,163.4 shares of the Series C Preferred; and

 

3.                                     Section 2.3of the Purchase Agreement is hereby amended to read in its entirety as follows:

 

2.3                Exercise of the AdditionalPurchase Right. The Additional Purchase Right shall be dividedinto two tranches. The first tranche shall be comprised of 3,700 shares ofSeries B Preferred and 33,081.7 shares of Series C Preferred. TheInvestors may exercise the first tranche in whole or in part and in one or moreinstances, until the maximum number of Additional Preferred Shares included inthe first tranche shall have been purchased, at any time during the periodcommencing on the Initial Closing Date and ending at 5:00 p.m.(PST) on the date that is 120 days after the Initial Closing Date(the “First Tranche Additional Purchase Period”) by delivering a writtennotice to the Company in accordance with Section 12.8 hereof (each suchnotice, a “First Tranche Additional Purchase Notice”). The secondtranche also shall be comprised of 3,700 shares of Series B Preferred and33,081.7 shares of Series C Preferred. The Investors may exercise thesecond tranche in whole or in part and in one or more instances, until themaximum number of Additional Preferred Shares included in the second trancheshall have been purchased, at any time during the period commencing on theInitial Closing Date and ending at 5:00 p.m. (PST) on the date thatis 360 days after the Initial Closing Date (the “Second TrancheAdditional Purchase Period”) by delivering a written notice to the Companyin accordance with Section 12.8 hereof

 

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(each such notice, a “Second Tranche AdditionalPurchase Notice”). For the sake of clarity, the parties understand andagree that the Investors may exercise both tranches during the first120 days after the Initial Closing Date. Each Additional Purchase Noticeshall specify the number of Additional Preferred Shares to be purchased and theanticipated Subsequent Closing Date.

 

4.                                     Section 2.6of the Purchase Agreement is hereby amended to read in its entirety as follows:

 

2.6                                 Purchase andSale of the Additional Preferred Shares. If, following any exerciseby the Investors of the Additional Purchase Right, all of the conditions to thepurchase, sale and issuance of the Additional Preferred Shares set forth inSections 8 and 9 of this Agreement shall have been satisfied or waived inaccordance herewith, then on the terms and conditions set forth in thisAgreement, on the applicable Subsequent Closing Date, the Investors willpurchase from the Company, and the Company will issue, sell and deliver to theInvestors, the number of Additional Preferred Shares specified in theapplicable Additional Purchase Notice for an aggregate purchase price equal tothe Additional Shares Purchase Price or, if less than all of the AdditionalPreferred Shares are to be purchased, then at a purchase price equal to$7,400,000 multiplied by a fraction, the numerator of which is the number ofUnits to be purchased and the denominator of which is 7,400, to be paid in fullto the Company on the applicable Subsequent Closing Date.

 

5.                                     Section 4.13of the Purchase Agreement is hereby amended to read in its entirety as follows:

 

4.13 Conversion Shares.To the extent permitted by the number of shares of authorized common stock, theConversion Shares issuable upon conversion of the Series C PreferredShares have been duly and validly reserved for issuance and, upon issuance,will be duly and validly issued, fully paid and nonassessable and will be freeof any Liens or restrictions on transfer other than restrictions on transferunder this Agreement and under applicable state and federal securities laws.

 

6.                                     Section 4.14of the Purchase Agreement is hereby amended to read in its entirety as follows:

 

4.14 Capitalization.The authorized capital stock of the Company consists of 100,000,000 shares ofCommon Stock and 25,000,000 shares of preferred stock, par value $0.0001. Allissued and outstanding shares have been duly authorized and validly issued andare fully paid and nonassessable. The respective rights, preferences,privileges, and restrictions of the Series B Preferred, Series CPreferred and the Common Stock are as stated in the Certificate ofIncorporation (including the Series

 

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B Certificate of Designations and Series CCertificate of Designations). All outstanding securities have been issued incompliance with state and federal securities laws.

 

7.                                     Section 10.1of the Purchase Agreement is hereby amended to read in its entirety as follows:

 

10.1                           IntentionallyOmitted.

 

8.                                     Section 10.3of the Purchase Agreement is hereby amended to read in its entirety as follows:

 

10.3                           IntentionallyOmitted.

 

On and after the date hereof, each reference in thePurchase Agreement to the “Agreement” shall mean the Purchase Agreement asamended hereby.  Except as specificallyamended above, the Purchase Agreement shall remain in full force and effect andis hereby ratified and confirmed.

 
| **IMAGE ENTERTAINMENT, INC.**   |   | **JH PARTNERS, LLC, as the Investor Representative** |
|--------------------------------------|--------|------------------------------------------------------|
|                                 |   |                                                 |
|                                 |   |                                                 |
| /s/ JOHN P. AVAGLIANO                |   | /s/ JOHN HANSEN                                      |
| By:  John P. Avagliano, COO/CFO |   | Name: John Hansen                                    |
|                                 |   | Title: President                                     |

 

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