Lions Gate Entertainment Corp. (Lionsgate) announced that it has entered into an Exchange Agreement with Lions Gate Capital Holdings 1 Inc. and Lions Gate Capital Holdings LLC, wholly-owned subsidiaries of Lionsgate, and certain holders of its previously issued 5.500% Senior Notes due 2029. Under the terms of the agreement, approximately $383 million in aggregate principal amount of the Existing Notes will be exchanged for New Notes to be issued by Lions Gate Capital Holdings 1 Inc. The New Notes will facilitate the anticipated full separation of the Company's Studio Business and STARZ Business.

Prior to the anticipated separation, the New Notes will bear interest at a rate of 5.500% per year and mature in 2029. Upon separation, the New Notes will be part of the Studio Business capital structure, bear interest at a rate of 6.000% per year and have their maturity extended to 2030. The completion of transactions under the Exchange Agreement is subject to the satisfaction of certain customary closing conditions.

Lionsgate noted that the Exchange Agreement enhances the balance sheets of its Studio and STARZ Businesses in anticipation of a full separation. Wachtell, Lipton, Rosen & Katz served as legal advisor to Lionsgate. Perella Weinberg Partners LP served as financial advisor and White & Case LLP served as legal advisor to the noteholders party to the Exchange Agreement.