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Lionsgate to Let Icahn Vote on His Own Takeover Offer

Amends Shareholders Rights Plan to change voting rules, but still urges shareholders to vote against offer

Lionsgate has opened voting on its poison pill defense to Carl Icahn, who is trying to take over the company.

In a change to voting rules, the company in a letter sent Friday to shareholders said, "The amended Shareholder Rights Plan provides that the shares held by Carl Icahn and certain of his affiliated entities (the ‘Icahn Group’) will be taken into account in the vote at the Special Meeting of Shareholders held on May 4, 2010 (the ‘Special Meeting’).

"Originally, the voting threshold for confirming the Shareholder Rights Plan was a vote of the majority of independent shares represented at the Special Meeting, and now it is a majority of all shares represented at the meeting."

Lionsgate in its letter again urged shareholders to reject Icahn’s tender offer and to vote for the shareholder rights plan.

In conjunction with the amended Shareholder Rights Plan, the Company filed proxy statement supplements in the U.S. and Canada.

The full text of the letter follows:

April 23, 2010

Dear Fellow Lionsgate Shareholder:

Lionsgate’s May 4, 2010 Special Meeting of Shareholders is right around the corner and your support to confirm the Shareholder Rights Plan is critical to protecting the value of your investment in the Company. Your Board urges you to vote FOR the Shareholder Rights Plan on the WHITE proxy card. The Board also urges shareholders to discard any gold proxy card that they receive from the Icahn Group.

PROTECT THE VALUE OF YOUR INVESTMENT IN LIONSGATE

VOTE FOR THE SHAREHOLDER RIGHTS PLAN
ON THE WHITE PROXY CARD

DO NOT TENDER YOUR SHARES INTO THE

ICAHN GROUP’S INADEQUATE OFFER

The Shareholder Rights Plan was implemented to ensure that:

· All of the Company’s shareholders are treated equally and fairly in connection with any proposals to acquire effective control of the Company;

· The rights of every shareholder are maintained; and

· Significant decision-making authority is afforded to shareholders.

The Shareholder Rights Plan your Board is recommending does not prevent change of control transactions. By design, the Shareholder Rights Plan does not prevent or restrict a proxy challenge, but deters inadequate, opportunistic and coercive offers, such as the offer by the
Icahn Group.

In addition, the Board has amended the Shareholder Rights Plan. Information on the amendment to the Shareholder Rights Plan is contained in the supplement to Lionsgate’s Proxy Statement filed with the Securities and Exchange Commission (the “SEC”) and with Canadian regulators.

Glass Lewis and Egan-Jones, Leading Proxy Advisory Firms, Believe the

Shareholder Rights Plan Is in the Best Interest of Shareholders

Glass Lewis, a leading independent proxy advisory firm, recommends that Lionsgate shareholders vote FOR the Shareholder Rights Plan. Glass Lewis has stated that the “shareholder-friendly provisions” of the Shareholder Rights Plan “may serve to protect shareholder interests in the event that a takeover bid does not reflect the full value of the Company’s shares or is coercive” and “that shareholder ratification of the Company’s Rights Plan is in shareholders’ best interests.”*

Egan-Jones, another respected independent proxy advisory firm, also recommends that Lionsgate shareholders vote FOR the Shareholder Rights Plan. Egan-Jones has stated that it believes “the proposed Shareholder Rights Plan permits bid provisions that adequately ensure that shareholders are able to consider a reasonable offer for the Company” and that “the proposed provisions, pursuant of the proposed Shareholder Rights Plan, will be able to protect shareholder interests in the event that a takeover bid does not reflect the full value of the Company’s shares. Accordingly, we believe that the approval of the proposed Shareholder Rights Plan is in the best interest of the Company and its shareholders.” Egan-Jones recommends that Lionsgate shareholders “vote ‘FOR’ this Resolution.”*

Lionsgate respectfully believes that the recommendation issued by proxy advisory firm, RiskMetrics Group (Canada), opposing the Shareholder Rights Plan, is misguided. Lionsgate notes that it is RiskMetrics Group’s policy to vote against shareholder rights plans that do not allow for partial permitted bids. However, the Company wants to emphasize that the Shareholder Rights Plan permits shareholders to acquire up to 20% of the outstanding shares of Lionsgate. Moreover, Lionsgate’s Shareholder Rights Plan meets RiskMetrics Group’s (Canada) other criteria for a permitted bid because it requires a majority of independent shareholders to tender into the offer.

The Shareholder Rights Plan also gives the Company flexibility to allow any shareholder to buy up to 24.9% of the shares in connection with an offering of the Company’s securities. RiskMetrics Group, however, opposes this.

Lionsgate believes that partial bids are inherently coercive and that the Shareholder Rights Plan is fair to all shareholders. The Shareholder Rights Plan permits bids for all of the Lionsgate common shares that meet certain criteria, including that it is irrevocably conditioned on the tender of a majority of the shares not held by the offeror. This ensures that independent shareholders have the opportunity to approve the offer and helps protect Lionsgate from an offeror who might otherwise trigger an event of default under Lionsgate’s credit facilities, unless the offeror is committed to purchasing all shares the offeror does not already own.

ICAHN REFUSES TO FOLLOW THE SIMPLE ROADMAP
TO MAKE A FAIR AND QUALIFIED OFFER

· The Icahn Group has maintained a critically coercive feature of the offer that expressly reserves the right to waive the minimum tender condition. By reserving the right to waive the minimum tender condition, the Icahn Group is able to buy a small number of shares that could give it effective control.

· Lionsgate believes that this structure is unfair to its shareholders and could deprive them of making a meaningful, value-driven decision to reject or accept the offer.

Lionsgate believes that shareholders who agree that the Icahn Group’s offer is inadequate will support the Shareholder Rights Plan. If the Icahn Group is permitted to trigger an event of default under Lionsgate’s credit facilities, it may force shareholders who are worried about the resulting precarious situation to tender at the inadequate price. If the Icahn Group gains control of Lionsgate without having to pay a full and fair price for all the equity of the Company, nobody wins but the Icahn Group.

Lionsgate notes that the Icahn Group has petitioned the British Columbia Securities Commission and other Canadian regulators to have the Shareholder Rights Plan set aside before Lionsgate shareholders have an opportunity to vote. The Board believes that Lionsgate’s shareholders right to vote is paramount and agrees with RiskMetrics Group, which stated in its report that “In this case, too, it is [shareholder] votes that should be determinative.”*

VOTE THE WHITE PROXY CARD TODAY

The Shareholder Rights Plan’s continuation is dependent on shareholder approval at the Special Meeting. The Board recommends that you vote FOR the Shareholder Rights Plan on the WHITE Proxy Card.

Since time is short, please vote the WHITE proxy card by internet or telephone.

PLEASE BE SURE TO VOTE ALL YOUR SHARES AT THIS IMPORTANT SPECIAL MEETING. ALL PROXIES SHOULD TO BE RECEIVED BY THE COMPANY AND THE ELECTION SCRUTINEERS IN TORONTO, CANADA BY 10:00 AM ET, ON FRIDAY, APRIL 30, 2010, THE SCHEDULED CUT OFF FOR RECEIPT OF PROXIES FOR THE SPECIAL MEETING. ELECTRONIC VOTING BY INTERNET OR TELEPHONE WILL BE AVAILABLE UNTIL 11:59 PM ON THURSDAY APRIL 29, 2010. CALL MACKENZIE PARTNERS, INC. FOR ASSISTANCE AT (800)-322-2885 TOLL – FREE.

We urge you to discard any gold proxy card you receive from the Icahn Group.

Your Board strongly recommends rejecting the Icahn Group’s inadequate offer by not tendering your shares.

We have appreciated and look forward to your continued support.

Sincerely,

/s/ Jon Feltheimer /s/ Michael Burns

Jon Feltheimer Michael Burns

Co−Chairman and Chief Executive Officer Vice Chairman