Affiliated Fund of MHR Fund Management LLC Acquires Additional Common Shares
of Lions Gate Entertainment Corp.

NEW YORK, July 20 /CNW/ - On July 20, 2010, an investment fund affiliated with MHR Fund Management LLC purchased from Kornitzer Capital Management, Inc. $63,709,000 principal amount of the 2.9375% Convertible Senior Subordinated Notes due 2026 (the "2026 Notes") and $36,009,000 principal amount of 3.625% Convertible Senior Subordinated Notes due 2027 (the "2027 Notes" and, together with the 2026 Notes, the "Purchased Notes") of Lions Gate Entertainment Inc., a Delaware corporation ("LGEI") and a wholly-owned subsidiary of Lions Gate Entertainment Corp. ("Lions Gate"). The Purchased Notes represent all of the outstanding 2026 and 2027 Notes. The purchase was made pursuant to a purchase agreement executed on the same day between MHR Institutional Partners III LP ("Institutional Partners III") and Kornitzer Capital Management, Inc. The aggregate purchase price for the Purchased Notes was $105,650,993.63 (or approximately Cdn.$ 111,440,668).

Also on July 20, 2010, in accordance with the terms of the Purchased Notes, Institutional Partners III exercised its right to convert the Purchased Notes into 16,236,305 common shares of Lions Gate ("Common Shares") at a conversion price per Common Share of $6.20 (or approximately Cdn.$6.54). The Common Shares acquired upon conversion of the Purchased Notes represent approximately 11.9% of the Common Shares outstanding after giving effect to the conversion of the Purchased Notes.

As a result of the transactions described above, MHR Fund Management LLC and its joint actors (collectively, "MHR") may be deemed to be the beneficial owners of 39,419,126 Common Shares, representing approximately 28.9% of the Common Shares outstanding after giving effect to the conversion of the Purchased Notes.

The Common Shares were acquired by Institutional Partners III based on the view that the Common Shares represented an attractive investment opportunity. MHR reviews its holdings in Lions Gate on a continuing basis and as part of this ongoing review, evaluates various alternatives that are or may become available with respect to Lions Gate and its securities. MHR may from time to time and at any time, in its sole discretion, acquire or cause to be acquired, additional equity or debt securities or other instruments of Lions Gate, its subsidiaries or affiliates, or dispose or cause to be disposed, such equity or debt securities or instruments, in any amount that MHR may determine in its sole discretion, through open market transactions, privately negotiated transactions or otherwise.

The purchase of the Purchased Notes and the underlying Common Shares was made pursuant to the private agreement exemption in section 100.1 of the Securities Act (Ontario). In accordance with the requirements of the exemption, the consideration paid by Institutional Partners III to Kornitzer Capital Management, Inc. did not exceed 115% of either the value of the Purchased Notes nor the aggregate market price of the Common Shares underlying the Purchased Notes (based on the average closing price of the Common Shares on the New York Stock Exchange over the prior 20 business days).

The address of Institutional Partners III and MHR is

c/o MHR Fund Management LLC

40 West 57th Street, 24th Floor

New York, New York 10019

SOURCE MHR FUND MANAGEMENT LLC

For further information: For further information: For additional information, or to obtain a copy of the report required pursuant to the early warning reporting requirements, please contact: Bryan Darrow/Ed Trissel, Joele Frank, Wilkinson Brimmer Katcher, 212-355-4449

Organization Profile

MHR FUND MANAGEMENT LLC

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