MHR Enters into Trust Arrangement in connection with Acquisition of Common Shares of Lions Gate Entertainment Corp.

NEW YORK, Sept. 6, 2011 /CNW/ - On September 6, 2011, MHR Institutional Partners III LP ("Institutional Partners III"), an affiliated investment fund of Dr. Mark H. Rachesky, entered into an agreement (the "Trust Agreement") with Stanley Beck (the "Trustee") pursuant to which Institutional Partners III delivered to the Trustee 9,345,352 common shares of Lions Gate Entertainment Corp. (the "Trust Shares"), representing 6.81% of the common shares outstanding, to be held in trust for the benefit of Institutional Partners III. This trust arrangement has been entered into in the event that the acquisition of the Trust Shares would be subject to approval under the Investment Canada Act (the "ICA").

During the term of the Trust Agreement, the Trustee is entitled to exercise all voting rights in respect of the Trust Shares in his sole discretion, provided that Institutional Partners III will retain the right to vote the Trust Shares at the annual general meeting of Lions Gate's shareholders to be held on September 13, 2011 so long as voting the Trust Shares does not cause Institutional Partners III and its affiliated funds to hold voting power in excess of one-third of the outstanding common shares at such meeting.

Pursuant to the Trust Agreement, the Trust Agreement will terminate and the Trust Shares will be released to Institutional Partners III upon (a) a determination by either the relevant minister under the ICA or Institutional Partners III that such approval is not required under the ICA or (b) the approval or deemed approval of the acquisition of the Trust Shares under the ICA.

If Institutional Partners III notifies the Trustee that approval of the acquisition of the Trust Shares is required under the ICA, and Institutional Partners III further notifies the Trustee that such approval has been declined, or that Institutional Partners III has abandoned or withdrawn its application for such approval, the Trust Agreement provides that the Trustee will commence selling the Trust Shares and will distribute the net proceeds from the sale of the Trust Shares to Institutional Partners III.

The address of Mark H. Rachesky 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:

or for a copy of MHR's early warning report please contact:

        Annabelle Rinehart
Joele Frank, Wilkinson Brimmer Katcher
212-355-4449

 

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