Lionsgate and Xenon Pictures Announce New Home Entertainment Distribution Agreement

Lionsgate and Xenon Pictures Announce New Home Entertainment Distribution Agreement

SANTA MONICA, Calif. and VANCOUVER, Canada, March 26
/PRNewswire-FirstCall/ -- LIONSGATE(R) (NYSE:LGF), the leading independent filmed entertainment studio, announced today that it has entered into an exclusive multi-year agreement with leading Spanish language and urban/specialty company Xenon Pictures. The announcement was made by Lionsgate President and co-Chief Operating Officer Steve Beeks and Xenon Pictures' Founder, President and Chief Executive Officer Leigh Savidge.

Under the agreement, Lionsgate will distribute more than 300 DVD titles from Xenon and the labels it operates in the United States, including Spanish-language market leader Televisa Home Entertainment, as well as a number of theatrical features in the Xenon pipeline, including the Australian hit comedy Kenny, which opens in U.S. theatres this spring.

Xenon will continue to produce, acquire, and market its unique blend of product, with Lionsgate providing the sales and replenishment muscle. The new deal replaces the one that Xenon had with Universal Music's Vivendi Visual Entertainment division. Forty-four titles will remain with Vivendi until January 1, 2009. Xenon previously self-distributed its product for 18 years.

"We have been very impressed with Lionsgate's thoughtful and thorough approach to the home entertainment space in recent years, as well as with the professionalism of their sales force," said Savidge. "They truly understand what it is that we do, and their marketing and distribution prowess makes Lionsgate an ideal fit for our product."

"Xenon is an exciting addition to our growing library of Spanish-language titles," said Beeks. "The Xenon library builds upon a Spanish-language foundation established with our acquisition of other libraries and formation of other distribution agreements with a strong Spanish-language component. The partnership with Xenon extends both our Spanish-language and urban lines of business, two very important growth markets for Lionsgate."

Xenon has already successfully released a select group of titles through Lionsgate, including Snoop Dogg's Hood of Horror.

"We were very impressed with the collaborative approach that Lionsgate took with Hood of Horror," said Kristi Alires, Xenon's Vice President of Marketing. "They understood our marketing approach and translated it into impressive retail placement."

The deal was negotiated by Xenon's EVP/COO Stephen A. Housden and its CFO Kent Little, with Lionsgate EVP Business & Legal Affairs Wendy Jaffe negotiating for Lionsgate under Beeks' direction.

Founded in 1986, Xenon Pictures, Inc. is recognized in the industry for developing the nation's first label for independent black cinema. In developing this market niche, the company acquired and produced a wide spectrum of content, including the work of 1970's masters Melvin Van Peebles (Sweet Sweetback's Baadasssss Song) and Rudy Ray Moore (Dolemite); definitive biographies on Rosa Parks, Dr. Martin Luther King Jr. and Mahalia Jackson; films featuring hip hop stars like Snoop Dogg, Tupac and Dr. Dre, and contemporary films from directors such as Tim Story (Barbershop).

In August of 2002, Xenon signed a landmark deal with Mexican media powerhouse Grupo Televisa to develop and be the exclusive distributor for its domestic video brand, Televisa Home Entertainment. Working with a wide range of dynamic programming, such as classic television series, top-rated telenovelas, documentaries on major Latin stars, and theatrical features, Xenon has positioned Televisa to be the dominant brand in the Latin/Spanish-language genre. Most recently, Xenon theatrically released the acclaimed Mexican film 7 Dias, the story of a young man's quest to bring world-renowned rock band U2 to his home town. The title is currently available on DVD.

Apart from its activities in the black audience and Latin/Spanish genres, Xenon is committed to the acquisition of independent films, documentaries and television content that will provoke, excite and inspire audiences. The company's next theatrical release -- also under the Xenon Pictures banner -- is Kenny which, according to the Sunday Times, is "the best Australian comedy ... ever."

Lionsgate is the leading independent filmed entertainment studio and is a premier producer and distributor of motion pictures, television programming, home entertainment, family entertainment, video-on-demand and digitally-delivered content. Its prestigious and prolific library of nearly 12,000 motion picture titles and television episodes is a valuable source of stable, recurring revenue and a foundation for the growth of the Company's core businesses. The Lionsgate brand name is synonymous with original, daring, quality entertainment in markets around the globe.

For further information, please contact:
Jodie Magid/ Lionsgate
(212) 386-6885
jmagid@lionsgate.com

For corporate inquiries, please contact:
Peter D. Wilkes/ Lionsgate
(310) 255-3726
pwilkes@lionsgate.com

For Xenon:
Stephen A. Housden
(310) 451-5510
housden@xenonpictures.com

First Call Analyst:
FCMN Contact: kwalsh@lionsgate.com

Source: Lionsgate

CONTACT: Jodie Magid, +1-212-386-6885, jmagid@lionsgate.com, or for
corporate inquiries, Peter D. Wilkes, +1-310-255-3726, pwilkes@lionsgate.com,
both of Lionsgate; or Stephen A. Housden of Xenon, +1-310-451-5510,
housden@xenonpictures.com

Web site:

http://www.lionsgate.com/

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