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IMAGE ENTERTAINMENT ACCELERATES REPAYMENT OF SENIOR DEBT; $1.5 MILLION PRINCIPAL PAYMENT REDUCES $15 MILLION SENIOR DEBT BY 10 PERCENT

 CHATSWORTH, Calif., Aug. 26 /PRNewswire/ -- Image Entertainment Inc. (NASDAQ-NMS: DISK), one of the largest licensees and distributors of programming on laserdisc in the United States, announced that on Aug. 26, 1993, it voluntarily reduced its $15 million senior debt by $1.5 million -- a 10 percent reduction. The senior debt bears annual interest of 11 percent.
 Martin W. Greenwald, Image's Chairman and Chief Executive Officer, stated, "When we launched the restructuring of our operations in March, one of our goals was to utilize cash-flow from operations to reduce debt. Since our strong first quarter performance -- which included increased gross margins, scheduled reductions in slow-moving inventory and dramatic reductions in selling, general and administrative expense -- improved our overall cash position, it made financial sense to prepay a portion of our outstanding senior debt. This is a very positive move for the company. Exclusive of the one-time $45,000 prepayment penalty, the pay-down will result in annual interest expense savings of approximately $165,000."
 Greenwald continued, "Our mission is to maximize shareholder value. And our mandate is to constantly review operations for cost-savings opportunities. Interest expense reduction is a natural extension of this process since cash-flow from earnings and inventory reduction will fund any future debt repayment. We plan to regularly assess our cash position with an eye to the aggressive pursuit of accelerated debt reduction."
 The $15 million of 11 percent senior notes due Nov. 15, 1996, was privately placed on Nov. 18, 1991, along with $5 million of 13 percent secured subordinated notes due Nov. 15, 1998. The proceeds were used to retire approximately $14.2 million in short-term debt and to increase working capital. The $1.5 million prepayment does not affect the mandatory principal repayment schedule set forth in the notes. The first such repayment is due on Nov. 15, 1993, in the amount of $500,000 for each of the senior and subordinated notes.
 Image Entertainment Inc. is one of the largest licensees and distributors of programming on laserdisc in the United States, with an estimated 35 percent share of the domestic laserdisc market and the most extensive library of titles available in the industry. Image has exclusive licensing and distribution agreements with some of the most important suppliers of movies, music videos and specialty programming, including Disney's Buena Vista Home Video, FoxVideo, New Line Home Video, The Voyager Co., Orion Home Video, Playboy Home Video and Turner Home Video. The company's common stock trades on the NASDAQ National Market System (Symbol: DISK).
 -0- 8/26/93
 /CONTACT: Cheryl Lee, Esq., chief administrative officer and general counsel of Image Entertainment, 818-407-9100, ext. 256/
 (DISK)


CO: Image Entertainment Inc. ST: California IN: ENT SU:

LS-MF -- LA011 -- 5958 08/26/93 05:00 EDT
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Publication:PR Newswire
Date:Aug 26, 1993
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