By Erik Gruenwedel | Posted: 27 Feb 2009
Image Entertainment Feb. 27 said it would agree to extend to March 20 the merger deadline with Nyx Acquisition in exchange for $500,000 added to the current business interruption fee of $1.8 million.
Nyx, an affiliate of Q-Black, LLC, based in San Francisco, has a final option to extend the closing date to March 26, if it adds another $500,000 to the interruption fee trust account by March 19.
This extension would bring the interruption fee to $2.8 million.
Image shareholders Feb. 24 formally approved the acquisition by Nyx — originally slated to close Feb. 26 — which calls for Nyx to pay Image shareholders $2.75 per share in cash ($60.2 million), in addition to outstanding debt, for a total purchase price of $100 million.
Under the amended merger agreement, Nyx waived its right to challenge Chatsworth, Calif.-based Image’s right to collect the interruption fee should the merger fail.
Image, in turn, waived potential legal remedies against Nyx in excess of the interruption fee, so long as Nyx does not challenge the fee.
Earlier this month Image received the final $1.3 million installment of the business interruption fee, indicating the planned acquisition was a go.
The deal appeared in doubt last month when Nyx failed to deliver the $1.3 million payment (after an initial $500,000 deposit last November) by a Jan. 20 deadline.