UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K



☑			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, ~~2020~~2021



☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission File No.: 1-14880

LIONS GATE ENTERTAINMENT CORP.

(Exact name of registrant as specified in its charter)

British Columbia, Canada

N/A

(State or Other Jurisdiction of Incorporation or Organization)

(I.R.S. Employer Identification No.)

~~British Columbia, Canada~~

~~N/A~~

~~(State or Other Jurisdiction of Incorporation or Organization)~~

~~(I.R.S. Employer Identification No.)~~

250 Howe Street,

20th Floor

2700 Colorado Avenue

Vancouver,

British Columbia

V6C 3R8

Santa Monica,

California

90404

(877) 848-3866

(310) 449-9200

(Address of Principal Executive Offices, Zip Code)

Registrant’s telephone number, including area code:

(~~877~~) (877) 848-3866

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol(s)

Name of Each Exchange on Which Registered

Class A Voting Common Shares, no par value per share

LGF.A

New York Stock Exchange

Class B Non-Voting Common Shares, no par value per share

LGF.B

New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934. Yes ☐ No ☑

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or Section 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☑

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☑

The aggregate market value of the voting and non-voting stock held by non-affiliates of the registrant as of September 30, ~~2019~~2020 (the last business day of the registrant’s most recently completed second fiscal quarter) was approximately ~~$1,626,643,913,~~$1,626,230,422, based on the closing sale price of such shares as reported on the New York Stock Exchange.

As of May ~~18, 2020, 82,899,512~~24, 2021, 83,102,205 shares of the registrant’s no par value Class A voting common shares were outstanding, and ~~136,513,166~~138,425,280 shares of the registrant's no par value Class B non-voting common shares were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant’s definitive proxy statement relating to its ~~2020~~2021 annual meeting of shareholders (the “ ~~2020~~2021 Proxy Statement”) are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. The ~~2020~~2021 Proxy Statement will be filed with the U.S. Securities and Exchange Commission (the "SEC") within 120 days after the end of the fiscal year to which this report relates. Portions of the Registrant's Annual Report on Form 10-K for Fiscal ~~2019,~~2020, filed with the SEC on May ~~23, 2019,~~27, 2020, are incorporated by reference into Part II of this Annual Report on Form 10-K.

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			Page
PART I
Item 1. Business			45
Item 1A. Risk Factors			2423
Item 1B. Unresolved Staff Comments			4835
Item 2. Properties			4835
Item 3. Legal Proceedings			4836
Item 4. Mine Safety Disclosures			4936

PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			5037
Item 6. Selected Financial Data			5340
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations			5540
Item 7A. Quantitative and Qualitative Disclosures About Market Risk			8369
Item 8. Financial Statements and Supplementary Data			8671
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure			8671
Item 9A. Controls and Procedures			8671
Item 9B. Other Information			8974

PART III
Item 10. Directors, Executive Officers and Corporate Governance			8974
Item 11. Executive Compensation			8974
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			8974
Item 13. Certain Relationships and Related Transactions, and Director Independence			8974
Item 14. Principal Accounting Fees and Services			8974

PART IV
Item 15. Exhibits, Financial Statement Schedules			8974
Item 16. Form 10-K Summary			9378

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FORWARD-LOOKING STATEMENTS

This report includes statements that are, or may be deemed to be, “forward-looking statements” within the meaning of ~~the~~ Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These forward-looking statements can be identified by the use of forward-looking terminology, including the terms “believes,” “estimates,” “potential,” “anticipates,” “expects,” “intends,” “plans,” “projects,” “forecasts,” “may,” “will,” “could,” “would” or “should” or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this report and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which we operate.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We believe that these risks and uncertainties include, but are not limited to, those discussed under Part I, Item 1A. “Risk Factors.” These risk factors should not be construed as exhaustive and should be read with the other cautionary statements and information in ~~the~~this report. These factors may also be increased or intensified as a result of events related to the coronavirus ~~(COVID-19~~(COVID-19) global ~~pandemic),~~pandemic, including ~~if there is~~as a ~~resurgence~~result of potential resurgences of COVID-19 in certain parts of the ~~COVID-19 global pandemic after~~world, and the ~~initial outbreak subsides.~~discovery of new variants of the virus which could result in the re-imposition of certain restrictions and may lead to more restrictions being implemented again to reduce the spread of COVID-19. The extent to which the COVID-19 global pandemic ultimately impacts our business, results of operations and financial condition will depend on future developments, which are highly uncertain and cannot be predicted.

We caution you that forward-looking statements made in this report or anywhere else are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate may differ materially and adversely from those made in or suggested by the forward-looking statements contained in this report as a result of various important factors, including, but not limited to: the potential effects of the COVID-19 global pandemic on the Company, economic and business conditions; the substantial investment of capital required to produce and market films and television series; budget overruns; limitations imposed by our credit facilities and notes; unpredictability of the commercial success of our motion pictures and television programming; risks related to acquisition and integration of acquired businesses; the effects of dispositions of businesses or assets, including individual films or libraries; the cost of defending our intellectual property; technological changes and other trends affecting the entertainment industry; potential adverse reactions or changes to business or employee relationships; and the other risks and uncertainties discussed under Part I, Item 1A. Risk Factors herein. In addition, even if our results of operations, financial condition and liquidity, and the development of the industry in which we operate are consistent with the forward-looking statements contained in this report, those results or developments may not be indicative of results or developments in subsequent periods.

Any forward-looking statements which we make in this report speak only as of the date of such statement, and we undertake no obligation to update such statements. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.

This Annual Report on Form 10-K contains references to our trademarks and to trademarks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this Annual Report on Form 10-K, including logos, artwork and other visual displays, may appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other company.

Unless otherwise indicated or the context requires, all references to the “Company,” “Lionsgate,” “we,” “us,” and “our” refer to Lions Gate Entertainment Corp., a corporation organized under the laws of the province of British Columbia, Canada, and its direct and indirect subsidiaries.

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PART I

ITEM 1. BUSINESS.

Overview

Combining the STARZ premium global subscription platform with world-class motion picture and television studio operations, Lionsgate (NYSE: LGF.A, LGF.B) isbrings a ~~global content leader whose films, television series, digital products~~unique and ~~linear and over-the-top platforms reach next generation audiences~~varied portfolio of entertainment to consumers around the world. ~~Lionsgate’s~~Our film, ~~and~~ television, ~~properties support~~subscription and location-based entertainment ~~venues and other branded attractions, as well as a video game business. Lionsgate's content initiatives~~businesses are backed by a ~~nearly~~ 17,000-title library and one of the largest collections of film and television ~~library and delivered through a global sales and licensing infrastructure.~~franchises in the independent media space.

We manage and report our operating results through three reportable business segments: Motion Picture, Television Production and Media Networks. Financial information for our segments is set forth in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in this Annual Report.

COVID-19 Global Pandemic

In fiscal 2021, the impacts associated with the ongoing COVID-19 global pandemic and measures to prevent its spread, and the resulting economic uncertainty, affected our business in a number of ways.

We experienced early termination and delays in theatrical distribution of our films, both domestically and internationally, as well as delays in the production of film and television content (resulting in continued changes in future release dates for some titles and series). While we did begin (and, in certain instances, completed) production on a number of films and television series, and theaters began to reopen in 2021 in certain locations with reduced capacity, we are not able to accurately predict when theaters will re-open at scale, at what level consumers will return to movie theaters, when film production will fully resume, whether productions that have resumed will be paused again, the impact of incremental costs required to adhere to health and safety protocols, or if and when certain of our content will be released.

Conversely, television and streaming consumption around the globe increased, as well as home entertainment demand. STARZ experienced an increase in viewership of its content across all platforms, as well as an increase in subscribers to its over-the-top (“OTT”) services, both domestically and internationally. However, it is too early to say whether this increase is indicative of future results and whether growth may slow as governmental and other restrictions are relaxed, and as a result of the current and possible longer term negative economic impact of the pandemic.

We continue, however, to adapt to these new circumstances. For instance, we changed the release strategies of several of our theatrical films by releasing solely and/or earlier on streaming platforms, initially releasing on premium video-on-demand (“PVOD”), or by licensing directly to streaming platforms. We also began and completed post-production of several of our television series and continue the development of film properties and television series.

For additional information regarding the impact of COVID-19 on our operating results, cash flows and financial position, and the other risks and uncertainties see Part I, Item 1A. Risk Factors and Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Annual Report.

Motion Picture

Our Motion Picture segment includes revenues derived from the following:

•

•Home Entertainment. Home entertainment revenues are derived from the sale or rental of our film productions and acquired or licensed films and certain television programs (including theatrical and direct-to-video releases) on packaged media and through digital media platforms (including pay-per-view and video-on-demand platforms, electronic sell through, and digital rental). In addition, we have revenue sharing arrangements with certain digital media

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platforms which generally provide that, in exchange for a nominal or no upfront sales price, we share in the rental or sales revenues generated by the platform on a title-by-title basis.

•Television. Television revenues are primarily derived from the licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets.

•International. International revenues are derived from (i) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis, and (ii) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom.

•Other. Other revenues are derived from, among others, the licensing of our film and television and related content (e.g., games, music, location-based entertainment royalties, etc.) to other ancillary markets.

. Theatrical revenues are derived from the domestic theatrical release of motion pictures licensed to theatrical exhibitors on a picture-by-picture basis (distributed by us directly in the United States and through a sub-distributor in Canada).

•

~~Home Entertainment~~. Home Entertainment revenues are derived from the sale or rental of our film productions and acquired or licensed films and certain television programs (including theatrical and direct-to-video releases) on packaged media and through digital media platforms (including pay-per-view and video-on-demand platforms, electronic sell through, and digital rental). In addition, we have revenue sharing arrangements with certain digital media platforms which generally provide that, in exchange for a nominal or no upfront sales price, we share in the rental or sales revenues generated by the platform on a title-by-title basis.


•	~~Television. Television revenues are primarily derived from the licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets.~~


•	~~International.~~ International revenues are derived from (i) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis, and (ii) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom.


•	~~Other~~. Other revenues are derived from, among others, the licensing of our film and television and related content (e.g., games, music, location-based entertainment royalties, etc.) to other ancillary markets.

Television Production

Our Television Production segment includes revenues derived from the following:

•

•Television. Television revenues are derived from the licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks. Television revenues also include revenue from licenses to subscription-video-on-demand (“SVOD”) platforms in which the initial license of a television series is to an SVOD platform.

•International. International revenues are derived from the licensing and syndication to international markets of scripted and unscripted series, television movies, mini-series and non-fiction programming.

•Home Entertainment. Home Entertainment revenues are derived from the sale or rental of television production movies or series on packaged media and through digital media platforms.

•Other. Other revenues are derived from, among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions earned and executive producer fees related to talent management.

Television revenues are derived from the licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks. Television revenues also include revenue from licenses to subscription-video-on-demand (“SVOD”) platforms in which the initial license of a television series is to an SVOD platform.


•	~~International.~~ ~~International revenues are derived from the licensing and syndication to international markets of scripted and unscripted series, television movies, mini-series and non-fiction programming.~~


•	~~Home Entertainment.~~ ~~Home Entertainment revenues are derived from the sale or rental of television production movies or series on packaged media and through digital media platforms.~~


•	~~Other~~. Other revenues are derived from, among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions earned and executive producer fees related to talent management.

Media Networks

Our Media Networks segment includes revenues derived from the following:

•

•Starz Networks. Starz Networks’ revenues are derived from the domestic distribution of our STARZ branded premium subscription video services through OTT platforms and U.S. multichannel video programming distributors (“MVPDs”) including cable operators, satellite television providers and telecommunications companies (collectively, “Distributors”) on a direct-to-consumer basis through the Starz App.

•STARZPLAY International. STARZPLAY International revenues are primarily derived from OTT distribution of the Company's STARZ branded premium subscription video services outside of the U.S.

Starz Networks’ revenues are derived from the domestic distribution of our STARZ branded premium subscription video services pursuant to affiliation agreements with U.S. multichannel video programming distributors (“MVPDs”), including cable operators, satellite television providers and telecommunications companies, and over-the top (“OTT”) (collectively, “Distributors”), and on a direct-to-consumer basis.


•	~~STARZPLAY International. STARZPLAY International revenues are primarily derived from OTT distribution of the Company's STARZ branded premium subscription video services internationally.~~


•	~~Other Streaming Services. Other Streaming Services revenues are derived primarily from our majority owned premium Spanish language streaming services business, Pantaya.~~

Segment Revenue

For the year ended March 31, ~~2020,~~2021, contributions to the Company’s consolidated revenues from its reporting segments included Motion Picture ~~43.0%~~33.0%, Television Production ~~25.7%~~25.4% and Media Networks ~~38.2%~~47.8%, and intersegment revenue eliminations represented ~~(6.9)~~(6.2)% of consolidated revenues.

Within the Motion Picture segment, revenues were generated from the following:

•Theatrical, ~~21.3%~~1.1%;

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•Home Entertainment, ~~42.2%~~55.6%;

•Television, ~~14.8%~~21.3%;

•International, ~~20.4%~~20.1%; and

•Motion Picture-Other, ~~1.3%~~1.9%.

Within the Television Production segment, revenues were generated from the following:

•Television, ~~71.5%~~57.0%;

•International, ~~15.3%~~19.8%;

•Home Entertainment, ~~6.1%~~16.0%; and

•Television Production-Other, ~~7.1%~~7.2%.

Within the Media Networks segment, revenues were generated from the following:

•Starz Networks, ~~96.2%~~92.6%;

•STARZPLAY International, ~~1.5%~~4.2%

•Other Streaming Services, ~~2.3%~~3.2%.

Corporate Strategy

We continue to grow and diversify our portfolio of content to capitalize on demand from streaming and traditional platforms throughout the world. We maintain a disciplined approach to acquisition, production and distribution of content by balancing our financial risks against the probability of commercial success for each project. We also continue to invest in new programming and support the growth of STARZ’s direct-to-consumer offering and expansion of STARZPLAY, our international premium branded SVOD service. We believe that our strategic focus on content, alignment of our content creation and distribution platforms, and creation of other innovative content distribution strategies will enhance our competitive position in the industry, ensure optimal use of our capital, build a diversified foundation for future growth and create significant incremental long-term value for our shareholders.

MOTION PICTURE

Motion Picture - Theatrical

Production and Acquisition

We take a disciplined approach to theatrical production, with the goal of producing content that can be distributed through various domestic and international platforms. In doing so, we ~~attempt to~~may mitigate the financial risk associated with production by, among other things:

•Negotiating co-financing development and co-production agreements which may provide for ~~joint efforts and~~ cost-sharing with one or more third-party companies;

•Pre-licensing international distribution rights on a selective basis, including through international output agreements (which license rights to distribute a film in one or more media generally for a limited term, and in one or more specific territories prior to completion of the film);

•Structuring agreements that provide for talent participation in the financial success of the film in exchange for reduced guaranteed “up-front payments” that would be paid regardless of the film's success; and

•Utilizing governmental incentives, programs and other structures from state and foreign countries ~~(which typically take the form of~~(e.g., sales tax refunds, transferable tax credits, refundable tax credits, low interest loans, direct subsidies or cash rebates, calculated based on the amount of money spent in the particular jurisdiction in connection with the production).

Our approach to acquiring films ~~for~~complements our theatrical ~~release is similar to our approach to film production. We generally~~production strategy - we typically seek to limit our financial exposure ~~in acquiring films~~ while adding films with high potential for commercial box office success, critical recognition and successful monetization across a broad array of ~~quality and commercial viability to our release schedule and library.~~platforms.

Distribution

The economic life of a motion picture ~~consists~~may consist of its exploitation in theaters, on packaged media and on various digital and television platforms in territories around the world.

We generally distribute motion pictures directly to movie theaters in the U.S. whereby the exhibitor retains a portion of the gross box office receipts and the balance is remitted to the distributor. Concurrent with their release in the U.S., films are generally released in Canada and may also be released in one or more other

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foreign markets. We construct release schedules taking into account moviegoer attendance patterns and competition from other studios' scheduled theatrical releases. ~~We use either wide (generally, more than 2,000 screens nationwide) or limited initial releases, depending on the film.~~ After the initial theatrical release, distributors seek to maximize revenues by releasing films in sequential release date windows, which may be exclusive against other non-theatrical distribution platforms. As a result of the COVID-19 global pandemic, our distribution strategy may change, and certain films intended for theatrical release may be licensed to other platforms.

Producing, marketing and distributing films can involve significant risks and costs, and can cause our financial results to vary depending on the timing of a film’s release. For instance, marketing costs are generally incurred before and throughout the theatrical release of a film and, to a lesser extent, other distribution windows, and are expensed as incurred. Therefore, we typically incur losses with respect to a particular film prior to and during the film’s theatrical exhibition, and profitability for the film may not be realized until after its theatrical release window. Further, we may revise the release date of a film as the production schedule changes or in such a manner as we believe is likely to maximize revenues or for other business reasons. Additionally, there can be no assurance that any of the films scheduled for release will be completed ~~that completion will occur~~and/or in accordance with the anticipated schedule or budget, or that the film will ever be released.

Theatrical Releases

In fiscal ~~2020~~2021 (i.e., the twelve-month period ended March 31, ~~2020)~~2021), due to the closures and limited re-opening of theaters resulting from the COVID-19 global pandemic, we released 28only five (5) films theatrically in the U.S. across ~~all~~ our labels ~~which~~(which include Lionsgate, Summit Entertainment, Good Universe and our partnership with Roadside Attractions). Instead, we made changes to release dates as well as release strategies of several of our films by releasing solely and/or earlier on streaming platforms, initially releasing on PVOD, or by licensing directly to streaming platforms. In fiscal 2021, such titles and their release patterns included the following:

~~Twelve films released through our Lionsgate and Summit Entertainment labels (including films developed and produced in-house, films co-developed and co-produced and films acquired from third parties);~~

~~Three films released through our Good Universe label;~~

~~Three films released through Pantelion Films, our joint venture with Grupo Televisa; and~~

~~Ten films released through our partnership with Roadside Attractions.~~



Fiscal 2021 Releases
Title			Release Date		Release Pattern	Label
~~Fiscal~~Desperados			July 3, 2020 ~~Theatrical Releases~~		SVOD (via Netflix)	Good Universe
~~Title~~The Secret: Dare to Dream			~~Release Date~~July 31, 2020		~~Label/Partnership~~PVOD	Roadside Attractions
I Still Believe*Words On Bathroom Walls			~~March 13,~~August 21, 2020		~~Lionsgate~~Theatrical	Roadside Attractions
~~Hope Gap~~Antebellum			~~March 6,~~September 18, 2020		~~Roadside Attractions~~PVOD	Lionsgate
~~Las Pildoras De Mi Novio (My Boyfriend's Meds)~~Run			~~February 21,~~November 20, 2020		~~Pantelion Films~~SVOD (via Hulu)	Summit
~~The Last Full Measure~~Fatale			December 20, 2020 January ~~24, 2020~~8, 2021		~~Roadside Attractions~~Theatrical PVOD	Summit
~~The Grudge~~Pinocchio			~~January 3,~~December 25, 2020		~~Good Universe/Sony~~Theatrical	Roadside Attractions
~~Bombshell~~Barb and Star Go to Vista Del Mar			~~December 13, 2019~~February 12, 2021		~~Summit~~PVOD	Lionsgate
~~En Brazos De Un Asesino~~Chaos Walking*			~~December 6, 2019~~March 5, 2021		~~Pantelion Films~~Theatrical	Lionsgate
~~Knives Out~~The Courier**			~~November 27, 2019~~March 19, 2021		~~Lionsgate~~
~~The Warrior Queen Of Jhansi~~Theatrical	~~November 15, 2019~~			Roadside Attractions
~~Midway~~	~~November 8, 2019~~	~~Summit~~
~~My Love (Edmond) Cyrano~~	~~October 18, 2019~~	~~Roadside Attractions~~
~~Jexi~~	~~October 11, 2019~~	~~Lionsgate~~
~~Judy~~	~~September 27, 2019~~	~~Roadside Attractions~~
~~Rambo: Last Blood~~	~~September 20, 2019~~	~~Lionsgate~~
~~Tod@s Caen~~	~~August 30, 2019~~	~~Pantelion Films~~
~~Angel Has Fallen~~	~~August 23, 2019~~	~~Lionsgate~~
~~Fiddler: A Miracle Of Miracles~~	~~August 23, 2019~~	~~Roadside Attractions~~
~~Good Boys~~	~~August 16, 2019~~	~~Good Universe/Universal~~
~~Scary Stories To Tell In The Dark~~	~~August 9, 2019~~	~~Lionsgate~~
~~The Peanut Butter Falcon~~	~~August 9, 2019~~	~~Roadside Attractions~~
~~Marianne & Leonard: Words Of Love~~	~~July 5, 2019~~	~~Roadside Attractions~~
~~Anna (2019)~~	~~June 21, 2019~~	~~Summit~~
~~American Woman (2019)~~	~~June 14, 2019~~	~~Roadside Attractions~~
~~John Wick: Chapter 3 - Parabellum~~	~~May 17, 2019~~	~~Summit~~
~~Trial By Fire~~	~~May 17, 2019~~	~~Roadside Attractions~~
~~Long Shot~~	~~May 3, 2019~~	~~Good Universe/Summit~~
~~Fast Color~~	~~April 19, 2019~~	~~Lionsgate~~
~~Hellboy~~	~~April 12, 2019~~	~~Summit~~

* ~~Theatrical run terminated early due~~PVOD release on April 2, 2021

**PVOD release on April 16, 2021

Additionally, after an initial pause, we safely continued and completed production of a number of theatrical titles in fiscal 2021, allowing us to ~~the COVID-19 global pandemic.~~maintain a robust pipeline of films to meet increased demand across all platforms. While continuing to work closely with our theatrical exhibition partners, we are capitalizing on increased optionality and maintaining a platform agnostic approach to distribution to take full advantage of new windowing opportunities and alternative distribution strategies.

~~In fiscal 2020, we also released the following films ‘day-and-date’ (where select titles are released on video-on-demand (“VOD”)~~Nominations and ~~other digital formats on the same day as they are released theatrically):~~Awards



~~Fiscal 2020~~
~~Day-and-Date Releases~~
~~Title~~	~~Release Date~~	~~Label/Partnership~~
~~Intrigo: Death Of An Author~~	~~January 17, 2020~~	~~Grindstone~~
~~Inherit The Viper~~	~~January 10, 2020~~	~~Lionsgate~~
~~Hell On The Border~~	~~December 13, 2019~~	~~Grindstone~~
~~Trauma Center~~	~~December 6, 2019~~	~~Grindstone~~
~~The Courier~~	~~November 22, 2019~~	~~Grindstone~~
~~The Turkey Bowl~~	~~November 15, 2019~~	~~Lionsgate~~
~~Primal~~	~~November 8, 2019~~	~~Lionsgate~~
~~The Gallows Act Ii~~	~~October 25, 2019~~	~~Lionsgate~~
~~Lucky Day~~	~~October 11, 2019~~	~~Grindstone~~
~~The Cotton Club Encore~~	~~October 11, 2019~~	~~Lionsgate~~
~~Semper Fi~~	~~October 4, 2019~~	~~Lionsgate~~
~~10 Minutes Gone~~	~~September 27, 2019~~	~~Grindstone~~
~~3 From Hell~~	~~September 16, 2019~~	~~Lionsgate/~~ ~~Saban with Fathom~~
~~The Weekend~~	~~September 13, 2019~~	~~Grindstone~~
~~Strange But True~~	~~September 6, 2019~~	~~Lionsgate~~
~~Angel Of Mine~~	~~August 30, 2019~~	~~Grindstone~~
~~Apocalypse Now: Final Cut~~	~~August 15, 2019~~	~~Lionsgate~~
~~The Tracker~~	~~August 9, 2019~~	~~Grindstone~~
~~Killers Anonymous~~	~~June 28, 2019~~	~~Grindstone~~
~~Vault~~	~~June 14, 2019~~	~~Grindstone~~
~~The Poison Rose~~	~~May 24, 2019~~	~~Grindstone~~
~~Crypto~~	~~April 12, 2019~~	~~Grindstone~~

Lionsgate and affiliated companies have distributed films that have earned 129 Academy Award® nominations and 32 wins, as well as numerous Golden Globe Awards®, Producers Guild Awards®, Screen Actors Guild Awards®, Directors Guild Awards®, BAFTA Awards and Independent Spirit Awards nominations and wins.

Motion Picture - Home Entertainment

Our U.S. home entertainment distribution operation exploits our film and television content library of nearly 17,000 motion picture titles and television episodes and programs, consisting of titles from, among others, Lionsgate, our subsidiaries, affiliates and joint ventures (such as ~~Starz,~~STARZ, Summit Entertainment, Anchor Bay Entertainment, Artisan Entertainment,

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Grindstone Entertainment Group, Modern Entertainment, Trimark, Pantelion Films and Roadside Attractions), as well as titles from third parties such as A24, A&E, ~~Amazon Studios,~~ AMC, ~~CBS Films,~~ Entertainment Studios, ~~Marvel,~~ Saban Entertainment, Solstice, StudioCanal, and Tyler Perry Studios.Home entertainment revenue consists of packaged media and digital revenue.

Packaged Media

Packaged media distribution involves the marketing, promotion, ~~and~~ sale and/or lease of DVDs/Blu-ray discs to wholesalers and retailers who then sell or rent the DVDs/Blu-ray discs to consumers for private viewing. Fulfillment of physical distribution services are substantially licensed to Twentieth Century Fox Home Entertainment.

We distribute or sell content directly to retailers such as Wal-Mart, Best Buy, Target, Amazon ~~Costco~~ and others who buy large volumes of our DVDs/Blu-ray discs to sell directly to consumers. ~~Sales to Wal-Mart accounted for approximately 50% of net home entertainment packaged media revenue in fiscal 2020.~~ We also directly distribute content to the rental market through Redbox, Netflix and others.

Of these titles, certain are released through our subsidiary, Grindstone Entertainment Group, which acquires and/or produces titles as finished pictures and as “pre-buys” based on script, cast and genres, and creates targeted key art, marketing materials and

~~release plans, which are then distributed direct-to-video, VOD and through other media.~~ In fiscal ~~2020, Grindstone Entertainment Group released 35 titles.~~

~~Additionally, we distribute television product including series such as~~ ~~American Gods~~, ~~Ancient Aliens~~, ~~Ash vs. Evil Dead~~, ~~Blue Mountain State~~, ~~Duck Dynasty~~, ~~Fear the Walking Dead~~, ~~Grace and Frankie~~, ~~Narcos~~, ~~Into the Badlands~~, ~~Knightfall~~, ~~MacGyver~~, ~~Mad Men~~, ~~Nurse Jackie~~, ~~Orange Is The New Black~~, ~~Power~~, ~~Project Blue Book~~, ~~The Royals~~, ~~The Walking Dead~~, ~~Vida~~, ~~Weeds~~, ~~Zoey’s Extraordinary Playlist, library titles such as~~ ~~Alf~~ ~~and~~ ~~Little House on the Prairie, certain Disney-ABC Domestic Television series, as well as premier children's brands including Saban Brand’s~~ ~~Power Rangers~~ ~~and~~ ~~Aardman’s Shaun the Sheep~~ ~~library.~~

~~Our year included the following:~~


•	~~In fiscal 2020, four of our theatrical releases,~~ ~~Cold Pursuit~~, ~~Tyler Perry’s Madea Family Funeral~~, ~~Rambo: Last Blood, and~~ ~~Midway~~ ~~debuted at number one on DVD/Blu-ray;~~

~~In fiscal 2020,~~2021, we shipped ~~approximately 45~~over 29 million DVD/Blu-ray finished ~~units;~~units.

~~In calendar 2019, we had an approximate 9% market share for home entertainment, making us the number six studio in market share overall;~~

In calendar 2019, we maintained a box office-to-home entertainment conversion rate of 25% above the industry average. Box office-to-home entertainment conversion rate is calculated as the ratio of the total of both first cycle DVD release revenues and total digital platform revenues for a theatrical release compared to the total North American box-office revenues from such theatrical release.

Digital Media

~~Digital media distribution involves delivering~~Lionsgate directly distributes content (including certain titles not distributed theatrically or on physical media) ~~by electronic means directly to consumers in-home~~across a wide range of global distribution platforms and networks on ~~mobile devices. The key distribution methods today include~~an on-demand basis (whereby the viewer controls the timing of playback) through dozens of transactional ~~distribution (such as electronic-sell-through (“EST”)~~(transactional video-on-demand and ~~transactional video-on-demand (“TVOD”))~~electronic-sell-through), subscription, ~~video-on-demand (“SVOD”),~~ ad-supported ~~video-on-demand (“AVOD”)~~ and free video-on-demand ~~(“FVOD”)~~platforms. We also directly distribute content on a linear distribution basis (i.e., ~~as well as distribution~~whereby the programmer controls the timing of playback) through various linear pay, basic cable, and free, over-the-air television ~~platforms.~~

~~We directly distribute our content to digital transactional distribution~~ platforms ~~and networks including, among others, AMC Theaters On Demand, Amazon, Apple, Vudu, Google Play, Fandango NOW, Microsoft's Movies & TV, and Sony's PlayStation Network. Digital SVOD~~worldwide. Subscription video-on demand services to which we license our content include, among others, Netflix, Hulu, Amazon Prime, Paramount+ and ~~Amazon Prime. AVOD~~HBO Max; ad-supported video-on-demand services to which we license our content include, among others, The Roku Channel, Tubi TV, YouTube, IMDb, Pluto and ~~Peacock. We also directly distribute our content to other transactional distribution platforms, including, among others, MVPDs like Altice USA, Comcast, DIRECTV, DISH Network,~~Peacock; and ~~Verizon Fios.~~

~~Linear~~linear networks to which we distribute our content include, among others, pay television networks such as ~~Starz,~~STARZ, EPIX, HBO and Showtime, and basic cable network groups such as NBCUniversal Cable Entertainment, FX, ViacomCBS Domestic Media Networks, Turner Entertainment Networks, A+E Networks and AMC Networks, as well as Freeform, Reelz, Bounce, Telemundo and UniMás.

~~In fiscal 2020,~~Fiscal 2021 saw a continued shift in our release strategies due to a combination of the COVID-19 global pandemic and acceleration of secular trends already underway in the windowing of our motion picture product. With many theatres closed or operating at limited capacity due to stay-at-home restrictions, we ~~achieved~~created hybrid theatrical/streaming and early PVOD models for some of our films and bypassed theatrical exhibition altogether for others. Coupled with the ~~following:~~surge in content demand across all home entertainment platforms, digital media consumption increased sharply with four (4) of our titles, Antebellum, The Secret: Dare to Dream, The Silencing and Mortal reaching number one (1) on the iTunes movie charts and two titles, Force of Nature and The Secret, debuting at number one (1) on the Comscore On-Demand Chart.


•	~~Eight titles we distributed,~~ ~~Cold Pursuit, Tyler Perry’s Family Funeral, Long Shot, John Wick Chapter 3, Rambo: Last Blood, Midway, Knives Out, and Bombshell~~ ~~debuted at the number one ranking on the Rentrak On-Demand charts.~~


•	~~Five of our titles reached the number one ranking on the iTunes’ movie charts, including~~ ~~John Wick Double Feature, Long Shot, Knives Out, John Wick 3, and Angel Has Fallen~~.

Motion Picture - Television

We license our theatrical productions and acquired films to the domestic linear pay, basic cable and free television markets. For additional information regarding such distribution, see Motion Picture-Home Entertainment - Digital Media above.

Motion Picture - International

Our international sales operations are headquartered at our offices in London, England. The primary components of our international business are, on a ~~territory by territory~~territory-by-territory basis through third parties or directly through our international divisions:

•The licensing of rights in all media of our in-house feature film product and third party acquisitions on an output basis;

•The licensing of rights in all media of our in-house product and third party acquisitions on a sales basis for non-output territories;

•The licensing of third party feature films on an agency basis; and

•Direct distribution of theatrical and/or ancillary rights licensing.

We license rights in all media on a ~~territory by territory~~territory-by-territory basis (other than the territories where we self-distribute) of (i) our in-house Lionsgate and Summit Entertainment feature film product, and (ii) films produced by third parties such as Black Label Media, ~~CBS Films,~~ Gold Circle Films, Participant Media, River Road Entertainment, Thunder Road Pictures and other independent producers. Films licensed and/or released by us internationally in fiscal ~~2020~~2021 included such in-house productions asAntebellum, Run, Chaos Walking, Barb and Star Go to Vista Del Mar ~~Knives Out, Bombshell,~~ and I Still Believe ~~John Wick: Chapter 3 - Parabellum, Anna,~~ ~~and~~ ~~Long Shot.~~. Third party films for which we were engaged as exclusive sales agent and/or released by us internationally in fiscal ~~2020~~2021 included ~~Burden, Dark Waters, Playmobil,~~Six Minutes to Midnight and ~~Paradise Hills.~~City of Lies.

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Through our ~~territory by territory~~territory-by-territory sales and output arrangements, we generally cover a substantial portion of the production budget or acquisition cost of new theatrical releases which we license and distribute internationally. Our output agreements for Lionsgate and Summit feature films currently cover ~~12 major territories including the following:~~

~~Australia/New Zealand;~~

~~Benelux (Belgium/Netherlands/Luxembourg);~~

~~Canada;~~

~~CIS (Commonwealth of Independent States);~~

~~Ex-Yugoslavia (e.g., Croatia, Slovenia, Bosnia~~Scandinavia and ~~Herzegovina, Serbia, Kosovo, Macedonia, Montenegro and Albania);~~

~~Eastern Europe (Bulgaria, Czech Republic, Hungary, Romania and Slovak Republic);~~

~~France;~~

~~Middle East;~~

~~Poland;~~

~~Scandinavia;~~

~~Singapore; and~~

~~Spain.~~

France. These output agreements generally include all rights for all media (including home entertainment and television rights). We also distribute theatrical titles in Latin America through our partnership with International Distribution Company, ~~and certain~~as well as theatrical ~~titles~~rights in ~~China~~Canada through our ~~relationship~~partnership with ~~Hunan TV & Broadcast Intermediary Co.~~Mongrel Media and Cineplex.

We also self-distribute motion pictures in the United Kingdom and Ireland through Lions Gate International UK (“Lionsgate UK”). Lionsgate UK has established a reputation in the United Kingdom as a leading producer, distributor and acquirer of commercially successful and critically acclaimed product. In fiscal ~~2020, Lionsgate~~2021, due to the closures and very limited re-opening of cinemas as a result of the COVID-19 global pandemic, we released only two films theatrically in the UK, ~~released~~both on a very limited basis. Instead, we made changes to release dates and strategies for our remaining titles, releasing on PVOD streaming platforms or by licensing directly to streaming services. Such titles and their release patterns included the ~~following 16 films theatrically:~~

following:



Fiscal ~~2020~~2021 Releases ~~Theatrical Releases -~~ Lionsgate UK
Title		Release Date
~~Missing Link~~How To Build A Girl**		~~April 5, 2019~~July 24, 2020
~~Hellboy~~Summerland		~~April 11, 2019~~July 31, 2020
Red JoanRide Like A Girl		~~April 19, 2019~~July 31, 2020
~~Long Shot~~The Secret*		~~May 3, 2019~~August 1, 2020
~~John Wick: Chapter 3 - Parabellum~~Christmas Gift From Bob, A		~~May 17, 2019~~November 6, 2020
~~Anna~~I Still Believe**		~~July 5, 2019~~February 12, 2021
~~The Queen's Corgi~~Barb & Star Go To Vista Del Mar*		~~July 5, 2019~~February 12, 2021
~~Angel Has Fallen~~Ammonite*		~~August 21, 2019~~March 26, 2021
~~Rambo: Last Blood~~Six Minutes To Midnight**		~~September 19, 2019~~March 26, 2021
~~Skin~~Made in Italy**		~~September 27, 2019~~
Farming*	~~October 11, 2019~~
~~Midway~~	~~November 8, 2019~~
~~Knives Out~~	~~November 27, 2019~~
~~Bombshell~~	~~January 17, 2020~~
The Personal History of David Copperfield*	~~January 24, 2020~~
Military Wives**	March ~~6, 2020~~26, 2021

* ~~British film productions.~~PVOD

** ~~Theatrical run terminated early due~~Sold to ~~the COVID-19 global pandemic.~~streaming service.

Additionally, we have established an office in India to manage operations and growth opportunities in the South Asian/Indian sub-continent. Through our local office in Mumbai, we manage the following activities:

•License our feature films, television series, library content to local linear and digital platforms;

•Appoint and work closely with theatrical distribution partners to maximize box office for our films;

•Partner with local production companies, as well as develop in-house, Indian local language television series and feature films for distribution across other media platforms;

•Continue to expand our ~~Starz’s~~STARZ’s offering in the region and across emerging Asian markets (branded as Lionsgate Play), through ~~its~~our direct-to-consumer launch and in collaboration with ~~Vodafone Idea~~telco partners, Amazon and ~~Airtel;~~Apple TV; and

•Explore investment opportunities throughout the South Asian/Indian media market.

Motion Picture - Other

Global Live, Interactive and Location Based Entertainment

Our Global Live, Interactive and Location Based Entertainment division drives incremental revenue and builds consumer engagement across our entire portfolio of properties via licensing and launching of live shows and experiences, location-based entertainment destinations, games, and related merchandise around the world, and through select strategic partnerships and investments.

Our Global Live Entertainment business focuses on licensing, developing, and producing live stage shows, concerts, and live immersive experiences and events based on our theatrical and television content.

Our Interactive Entertainment business focuses on growing ~~our robust~~a games slate that includes games across PC/console, mobile, ~~casino, tabletop,~~ virtual reality and more, as well as integration of our properties into franchise crossover events with marquee games. ~~We also maintain strategic investments in Finnish mobile game developer/publisher Next Games, live-streaming native mobile gaming platform Mobcrush, and leading esports franchise Immortals.~~

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Our Location Based Entertainment business licenses and produces our Lionsgate, theatrical, and television brands for theme parks, destinations, and stand-alone attractions and experiences. Our projects currently include, among others, Lionsgate Entertainment World in Hengqin, China, an indoor theme park which opened on July 31, 2019, and a Lionsgate branded theme park zone at the Motiongate Theme Park in Dubai, which opened in October of 2017.

Music

Our music department creatively manages music for our theatrical and television slates, including overseeing songs, scores and soundtracks for all of our theatrical productions, co-productions and acquisitions, as well as music staffing, scores and soundtracks for all of our television productions. Music revenues are derived from the sales and licensing of music from our films, television, and other productions, and the theatrical exhibition of our films and the broadcast and webcast of our productions.

Ancillary Revenues

Ancillary revenues are derived from the licensing of ~~non-theatrical uses of our~~ films and television content ~~to distributors who, in turn, make such content available to airlines, hotels, schools,~~at non-theatrical venues including educational and institutional facilities, U.S. military bases, oil rigs, ~~public libraries,~~hospitals, hotels, prisons, ~~community groups, the armed forces, ships at sea~~ and ~~others.~~on all forms of common carrier transportation, including airlines and ships.

TELEVISION PRODUCTION

Our television business consists of the development, production, syndication and distribution of television programming. We principally generate revenue from the licensing and distribution of such programming to broadcast television networks, pay and basic cable networks, digital platforms and syndicators of first-run programming, which license programs on a station-by-station basis and pay in cash or via barter (i.e., trade of programming for airtime). Each of these platforms may acquire a mix of original and library programming.

After initial exhibition, we distribute programming to subsequent buyers, both domestically and internationally, including basic cable network, premium subscription services or digital platforms (known as “off-network syndicated programming”). Off-network syndicated programming can be sold in successive cycles of sales which may occur on an exclusive or non-exclusive basis. In addition, television programming is sold on home entertainment (packaged media and via digital delivery) and across all other applicable ancillary revenue streams including music publishing, touring and integration.

As with film production, we use tax credits, subsidies, and other incentive programs for television production in order to maximize our returns and ensure fiscally responsible production models.

Television Production - Television

Lionsgate Television

Despite initial production delays and changes to future network release dates as a result of the COVID-19 global pandemic, we commenced and completed production on a number of television series. We currently produce, syndicate and distribute nearly 6070 television shows on more than 25 networks (including programming produced by Pilgrim Media Group, of which we own a majority interest).

In fiscal ~~2020,~~2021, scripted and unscripted programming produced, co-produced or distributed by us and our affiliated entities (see Starz Original Programming below for original programming that appears on our ~~Starz~~STARZ services), as well as programming syndicated by our wholly-owned subsidiary, Debmar-Mercury, included the following:

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Fiscal ~~2020~~2021
Scripted - Lionsgate
Title		Network
~~Dear White People~~Home Economics		~~Netflix~~ABC
~~Florida Girls~~Julia		~~Pop~~HBO Max
~~Greenleaf~~Love Life		~~OWN~~HBO Max
~~High Town~~MacGyver		~~Starz~~CBS
~~Leavenworth~~Mythic Quest		~~Starz~~Apple
~~MacGyver~~Power Book II: Ghost		~~CBS~~Starz
~~Manhunt: Deadly Games~~Run the World		~~Charter~~Starz
~~Mythic Quest~~		~~Apple+~~
~~Orange Is The New Black~~	~~Netflix~~
~~Power~~	~~Starz~~
~~Power Confidential~~	~~Starz~~
~~P-Valley~~	~~Starz~~
~~The Rook~~	~~Starz~~
~~Vida~~	~~Starz~~
Zoey's Extraordinary Playlist	NBC



Fiscal ~~2020~~2021
Unscripted - Lionsgate
Title		Network
~~Chasing the Cure~~Confronting a Serial Killer		~~TNT~~Starz
De Viaje con los Derbez		Pantaya
~~Gooseberry~~House of Ho		~~Comedy Central~~HBO Max
~~Grant~~Selling Sunset		~~History~~Netflix
~~Kevin Hart: Don't F**k This Up~~Skindecision		Netflix
~~Kevin Hart: What The Fit~~	~~YouTube~~
~~Kevin Hart's Laugh Out Loud~~	~~Bounce~~
~~Raise The Bar~~	~~YouTube~~
~~Revenge Body With Khloé Kardashian~~	E!
~~Selling Sunset~~	~~Netflix~~
~~Skindecision~~	~~Netflix~~



Fiscal ~~2020~~2021
Unscripted - Pilgrim Media Group
Title		Network
American ~~Wreckers~~Chopper		~~History~~Discovery
~~Driven~~Dodgeball Thunderdome		Discovery
~~Fast & Loud~~Driven		Discovery
~~Ghost Hunters~~Giving Voice		~~A&E~~Netflix
My Big Fat Fabulous Life		TLC
Street Outlaws		Discovery
Street Outlaws: America's List		Discovery
Street Outlaws: Farm Truck & AZN		Discovery
Street Outlaws: Fastest in America		Discovery
Street ~~Outlaws Memphis~~Outlaws: Mega Cash Days		Discovery
Street Outlaws: Memphis		Discovery
Street Outlaws: No Prep ~~King~~Kings Grudge Night		Discovery
~~Switching Gears~~Street Outlaws: Race Night In America		Discovery
~~Wicked Tuna~~The Puppy Bowl Presents: Dog Games		~~Nat Geo~~Discovery+
The Ultimate Surfer		ABC
Tyson vs Jaws: Rumble on the Reef		Discovery
Wicked Tuna		Nat Geo
Wicked Tuna Outer Banks		Nat Geo
~~Zombie House Flipping~~	~~FYI~~

Table of ~~our employees, partners and affiliates, in order to provide creative entertainment content to serve diverse audiences worldwide.~~

~~Impact of COVID-19 Global Pandemic~~

The impact of disruptions associated with the ongoing COVID-19 global pandemic and measures to prevent its spread and mitigate its effects both domestically and internationally, and the resulting unprecedented economic uncertainty, are affecting our business in a number of ways. To date, we have experienced early termination of the theatrical run of one of our films domestically and one of our films in the UK, delayed theatrical distribution of several films domestically and internationally, and delayed production of film and television content (resulting in changes in future release dates for some titles and series). Our partners have also closed several location-based entertainment attractions based on our film and television properties. Conversely, television and streaming consumption around the globe has increased as well as home entertainment demand. STARZ has experienced an increase in viewership of its content across all platforms as well as an increase in subscribers to its OTT services, both domestically and internationally. In a number of instances, we have also been able to adapt to these new circumstances by releasing one of our theatrical films earlier on streaming platforms, completing post-production of one of our television series remotely and continuing the development of a number of our television series utilizing virtual writers’ rooms. These changes in the way we operate may be helpful to partially offset some of the negative impacts from the pandemic; however, the ultimate impact of these changes and the COVID-19 global pandemic cannot be predicted with certainty. For additional information regarding the impact on our operating results, cash flows and financial position, and the other risks and uncertainties see Part I, Item 1A. ~~Risk Factors~~ ~~and Part II, Item 7.~~ ~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~ ~~in this Annual Report.~~Contents

~~Social Responsibility and Employee Engagement~~

~~Lionshares~~

We are committed to acting responsibly and making a positive difference in the local and global community through Lionshares, the umbrella for our companywide commitment to our communities. Lionshares is a volunteer program that seeks to provide opportunities for employees within the Lionsgate family to partner with a diverse range of charitable organizations. The program not only enriches the Lionsgate work experience through cultural and educational outreach, but also positively interacts and invests in the local and global community.

Employee Resource Groups

We are proud to provide our employees with an array of Employee Resource Groups (“ERGs”) which offer them the chance to establish a greater presence at Lionsgate and an opportunity to enhance cross-cultural awareness, develop leadership skills and network across the Company’s various business units and ~~levels through resource~~levels. The ERGs are voluntary, employee-led groups ~~including~~ that foster a diverse, engaging, and inclusive workplace.

•Lionsgate Early Career Group aims to inspire curiosity and networking to foster growth for professionals in early stages of their careers.

•Lionsgate Multicultural Employee Resource Group advocates for a more inclusive workplace and entertainment landscape through programs that educate, activate and celebrate multicultural diversity and its global impact.

•Lionsgate Parents Group aims to bring together parents, expecting parents, caregivers, and allies to ensure our community fosters an environment that supports all families.

•Lionsgate Pride ~~Lionsgate Vets and Lionsgate Women’s Empowerment Group.~~

Lionsgate Multicultural Group engages in partnerships that promote diversity, equity and inclusion within the Company and the industry, allowing for an exchange of ideas and resources that contribute to overall innovation.

~~Lionsgate Pride~~ supports, develops and inspires future ~~LGBTQ~~LGBTQIA leaders within the Company and the industry.

•Lionsgate Vets creates a community of veterans and their supporters working together to enhance veteran presence and engage the industry from the unique perspective of a military background.

•Lionsgate Women’s Empowerment Group creates a community that improves the prominence of female leaders and empowers women at all levels within the Company and the industry.

~~Employees~~

~~As of May 18, 2020, we had 1,443 full-time employees in our worldwide operations.~~

Lionshares

We ~~also utilize many consultants~~are committed to acting responsibly and making a positive difference in the ~~ordinary course~~local and global community through Lionshares, the umbrella for our companywide commitment to our communities. Lionshares is a volunteer program that seeks to provide opportunities for employees within the Lionsgate family to partner with a diverse range of ~~our business~~charitable organizations. The program not only enriches the Lionsgate work experience through cultural and ~~hire additional employees on a project-by-project basis~~educational outreach, but also positively interacts and invests in ~~connection with~~ the ~~production of our motion pictures~~local and ~~television programming.~~global community.

Other Employee Benefits and Programs

We understand the importance of well-rounded and inclusive benefits and programs and are dedicated to providing our employees with unique offerings that meet their individual needs. With respect to benefits, we offer a comprehensive benefits package which includes family forming benefits, mental health support, resources for caregiving (children and adult family), online fitness and meditation classes, and new parent coaching. With respect to learning and engagement, we offer programs to develop and enrich the employee experience with offerings such as tuition reimbursement, leadership development program, mentorship, and additional programs to help support specific populations (e.g., minorities, women, parents, LGBTQ+). We received the designation as a “Best Place to Work for LGBTQ Equality” for 2021.

Corporate History

We are a corporation organized under the laws of the Province of British Columbia, resulting from the merger of Lions Gate Entertainment Corp. and Beringer Gold Corp. on November 13, 1997. Beringer Gold Corp. was incorporated under the Business

Corporation Act (British Columbia) on May 26, 1986 as IMI Computer Corp. Lions Gate Entertainment Corp. was incorporated under the Canada Business Corporations Act using the name 3369382 Canada Limited on April 28, 1997, amended its articles on July 3, 1997 to change its name to Lions Gate Entertainment Corp., and on September 24, 1997, continued under the Business Corporations Act (British Columbia).

Available Information

Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Exchange Act, are available, free of charge, on our website at investors.lionsgate.com as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission (the “SEC”). The Company's Disclosure Policy, Corporate Governance Guidelines, Standards for Director Independence, Code of Business Conduct and Ethics for Directors, Officers and Employees, Policy on Shareholder Communications, Related Person Transaction Policy, Charter of the Audit & Risk Committee, Charter of the Compensation Committee and Charter of the Nominating and Corporate Governance Committee and any amendments thereto are also available on the Company's website, as well as in print to any shareholder who requests them. The information posted on our website is not incorporated into this Annual Report on Form 10-K. We will disclose on our

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website waivers of, or amendments to, our Code of Business Conduct and Ethics that applies to our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer or persons performing similar functions.

The SEC maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at www.sec.gov.

ITEM 1A. RISK FACTORS.

You should carefully consider the following risks ~~described below~~ as well as other information included in, or incorporated by reference into this Form 10-K. The risk and uncertainties described below are not the only ones facing the ~~Company. Additional~~Company; additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our ~~business operations.~~business. If any of these risks and uncertainties occur, they could adversely affect our business, financial condition, operating results, liquidity and prospects.

Risks Related to Our Business

The impact of the COVID-19 global pandemic could continue to materially and adversely affect our business, financial condition, and results of operations.

The ~~impact of disruptions~~impacts associated with the ~~ongoing~~ COVID-19 global pandemic and measures to prevent its spread, and ~~mitigate its effects both domestically and internationally, and~~ the resulting ~~unprecedented~~ economic uncertainty, ~~are affecting~~have affected our business in a number of ways. ~~To date, we~~We have experienced ~~early termination of the~~delays in theatrical ~~run of one~~distribution of our films ~~domestically~~(domestically and ~~one of our films~~internationally) and in the ~~UK, delayed theatrical distribution of several films domestically and internationally, the delayed~~ production of film and television content (resulting in ~~future~~continued changes in future release dates for some titles and series). ~~Our partners~~While we have ~~also closed several location-based entertainment attractions based on our film~~begun (and have, in certain instances, completed) production of a number of films and television ~~properties. We may~~series, and theaters have begun to reopen, we are not be able to accurately predict when theaters will re-open at scale, at what level consumers will return to movie theaters, when film production ~~resumes~~will fully resume, whether productions that have resumed will be paused again, the impact of incremental costs required to adhere to new health and safety protocols, or if and when certain of our content will be released. We also may not be able to predict if current insurance will provide sufficient coverage for continued production delays, or if we will be able to obtain and/or recover insurance coverage for productions in the future if there are additional disruptions associated with COVID-19 or similar pandemics. Our businesses could also be impacted should the disruptions lead to changes in consumer behavior. The COVID-19 global pandemic could also impact our results of operations by decreasing our revenue and increasing our expenses. As a direct result of the COVID-19 global pandemic and the related economic disruption, including the worldwide closure of most theaters, international travel restrictions and the pausing of motion picture and television productions, during the fourth quarter of fiscal 2020 we have incurred $50.5 million in incremental costs which were expensed in the period. We expect to incur additional incremental costs in future periods. In addition, to the potential direct impacts on our business, the global economy may be weakened as a result of actions taken in response to the COVID-19 global pandemic. To the extent that the weakened global economy impacts consumers’ ability or willingness to pay for our services, we could see our business and results of operations negatively affected.

~~Conversely, television and streaming consumption around the globe has increased as well as home entertainment demand.~~although STARZ has experienced an increase in viewership of its content across all platforms as well as an increase in subscribers to its OTT services, ~~both domestically and internationally. This increase, however,~~this may not be indicative of future results and growth may slow as

~~governmental and other~~ restrictions are relaxed and as a result of the current and possible long-term negative economic impact of the pandemic. In a number of instances, we have also been able to adapt to these new circumstances by releasing one of our theatrical films earlier on streaming platforms, completing post-production of one of our television series remotely and continuing the development of a number of our television series utilizing virtual writers’ rooms. These changes in the way we operate may be helpful to partially offset some of the negative impacts from the pandemic; however, the ultimate impact of these changes and the COVID-19 global pandemic cannot be predicted with certainty.

relaxed. We expect that the ultimate impact of these disruptions ~~including the extent of any adverse impact on our business, results of operations and financial condition,~~ will depend on, among other things, the duration and spread of the pandemic, the impact of governmental regulations that have been, and may continue to be, imposed in response to the pandemic, the effectiveness of actions taken to contain or mitigate the ~~outbreak,~~pandemic (including the availability, effectiveness and/or public acceptance of any Federal Drug Administration approved COVID-19 vaccines), responses to any resurgences, and global economic conditions ~~as a result of~~related to the ~~COVID-19 global~~ pandemic. ~~In addition, if a resurgence of the COVID-19 global pandemic occurs after the initial outbreak subsides, the impact could be exacerbated.~~ All of these impacts could place limitations on our ability to execute on our business plan and materially and adversely affect our business, financial condition and results of operations. We continue to monitor the situation, have actively implemented policies and procedures to address the situation and mitigate any adverse impacts, and may adjust our current policies and procedures as more information and guidance become available to address the evolving situation. The impact of the ongoing COVID-19 global pandemic and its effects may also exacerbate other risks discussed in Item 1A. ~~Risk Factors~~ ~~in this Annual Report, any of which could have a material effect on us. Accordingly, due~~Due to the evolving and uncertain nature of this situation, we are not able to estimate the full extent of the impact on our operating results, cash flows and financial ~~position.~~position, particularly over the near to medium term.

We face substantial capital requirements and financial risks.

~~Our business requires a substantial investment of capital.~~The production, acquisition and distribution of motion picture and television content requires substantial capital. A significant amount of time may elapse between our expenditure of funds and the receipt of revenues after release or distribution of such content. ~~This may require us to fund a significant portion of our capital requirements under the Senior Credit Facilities (as defined below) or other financing sources.~~ Although we reduce the risks of ~~our~~ production exposure through tax credit programs, government and industry programs, co-financiers and other sources, we cannot assure you that we will continue to successfully implement these arrangements or that we will not be subject to substantial financial risks relating to the production, acquisition and distribution of future motion picture and television content. ~~In addition, if we increase (through internal growth or acquisition) our~~Additionally, the production, ~~slate or our production budgets, we may be required to increase overhead and/or make larger up-front payments to talent~~completion and ~~consequently, bear greater financial risks. Any of the foregoing could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.~~

~~The costs of producing and marketing feature films is high and may increase in the future.~~ The costs of producing and marketing feature films generally increase each year, which may make it more difficult for our films to generate a profit. A continuation of this trend would leave us more dependent on other media, such as packaged media, digital media, television and international markets, which revenues may not be sufficient to offset an increase in the cost of motion picture production and marketing. If we cannot successfully exploit these other media, it could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~Budget overruns may adversely affect our business.~~ ~~While our business model requires that we be efficient in the production~~distribution of motion picture and television ~~content, actual production costs may exceed their budgets. The production, completion and distribution of such~~ content can be subject to a number of uncertainties, including delays and increased expenditures due to disruptions or events beyond our control. As a result, if production incurs substantial budget overruns, we may have to seek additional financing or fund the overrun ourselves. We cannot make assurances regarding the availability of such additional financing on terms acceptable to us, or that we will recoup these costs. For instance, increased costs or budget overruns incurred with respect to a particular film may prevent a picture from being completed or released or may result in a delayed release and the postponement to a potentially less favorable date, all of which could cause a decline in box office performance, and, thus, the overall financial success of such film. ~~Budget overruns could also prevent a picture from being completed or released.~~ Any of the foregoing could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

We may incur significant write-offs if our ~~feature films and other~~ projects do not perform well enough to recoup costs.

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We are required to amortize capitalized production costs over the expected revenue streams as we recognize revenue from films or other projects. The amount of production costs that will be amortized each quarter depends on, among other things, how much future revenue we expect to receive from each project. Unamortized production costs are evaluated for impairment each reporting period on a project-by-project basis. If estimated remaining revenue is not sufficient to recover the unamortized production costs, including because of delayed theatrical distribution of films as a result of the ~~ongoing~~ COVID-19 global pandemic and its effects, those costs will be written down to fair value. In any given quarter, if we lower our previous forecast with respect to total anticipated

revenue from any film or other project, we may be required to accelerate amortization or record impairment charges with respect to the unamortized costs, even if we previously recorded impairment charges for such film or other project. Such impairment charges could adversely impact our business, operating results and financial condition.

~~An impairment in the carrying value of goodwill and intangible assets could have a material adverse effect on our financial condition and results of operations.~~

~~At March 31, 2020, the carrying value of our goodwill and indefinite-lived intangible assets was~~ ~~$2.8 billion~~ and $250.0 million, respectively. Our indefinite-lived intangible assets consist of trade names primarily representing the estimated fair value of the Starz brand name determined in connection with the acquisition of Starz as of December 8, 2016. Our reporting units for purposes of goodwill impairment testing, along with their respective balances at March 31, 2020 were Motion Picture (goodwill of $394 million), Media Networks (goodwill of $2.04 billion), and each of our Television (goodwill of $309 million) and Talent Management (goodwill of $93 million) businesses, both of which are part of our Television Production segment.

For the second quarter of fiscal 2020, due primarily to the sustained decline in the market price of our common shares, we updated our quantitative impairment assessment for three (Television, Media Networks and Motion Picture) of our reporting units. Based on our quantitative impairment assessment for the second quarter of fiscal 2020, we determined that there were no goodwill impairments; however, two of our reporting units (Television and Media Networks) were at risk for impairment due to relatively small changes in certain key assumptions that could cause an impairment of goodwill.

For our annual goodwill impairment test for fiscal 2020, due to the decline in the market price of our common shares in the fourth quarter ended March 31, 2020, which was significantly impacted by the economic uncertainty and market volatility resulting from the COVID-19 global pandemic, we updated our quantitative impairment assessment for all of our reporting units as of March 31, 2020. Based on our annual quantitative impairment assessment for fiscal 2020, we determined that two of our reporting units (Television and Media Networks) were at risk for impairment.

The recoverability of goodwill is dependent upon the continued growth of revenue and cash flows from our business activities. Examples of events or circumstances that could result in changes to the underlying key assumptions and judgments used in our goodwill impairment tests, and ultimately impact the estimated fair value of our reporting units may include the duration of the COVID-19 global pandemic and its impact on the global economy and the creation and consumption of our content; adverse macroeconomic conditions; volatility in the equity and debt markets which could result in higher weighted-average cost of capital; the commercial success of our television programming and our motion pictures; our continual contractual relationships with our customers, including our affiliate agreements of our Media Networks business; our subscriber growth rates domestically and internationally across our traditional and OTT platforms and changes in consumer behavior. While historical performance and current expectations have resulted in fair values of our reporting units in excess of carrying values, if our assumptions used in our assessments are not realized, it is possible that an impairment charge may need to be recorded in the future, which could have a material adverse effect on our financial condition and results of operations.

~~At March 31, 2020, the carrying value of our finite-lived intangible assets was approximately~~ ~~$1.47 billion~~. Our finite-lived intangible assets primarily relate to customer relationships associated with U.S. MVPDs, including cable operators, satellite television providers and telecommunications companies (“Traditional Affiliate”), and the carrying value reflects the estimated fair value of these customer relationships determined in connection with the acquisition of Starz on December 8, 2016, net of amortization recorded since the date of the Starz acquisition.

Identifiable intangible assets with finite lives are amortized to depreciation and amortization expense over their estimated useful lives, ranging from 5 to 17 years. Through the first quarter of fiscal 2020, we amortized our Traditional Affiliate customer relationships discussed above on a straight-line basis over 17 years. Our finite-lived intangible assets are tested for impairment whenever events or changes in circumstances (triggering events) indicate that the carrying amount of the asset may not be recoverable. If a triggering event has occurred, an impairment analysis is required. The impairment test first requires a

comparison of undiscounted future cash flows expected to be generated over the useful life of an asset to the carrying value of the asset. The impairment test is performed at the lowest level of cash flows associated with the asset. If the carrying value of the asset exceeds the undiscounted future cash flows, the asset would not be deemed to be recoverable. Impairment would then be measured as the excess of the asset’s carrying value over its fair value.

Due to changes in the industry related to the migration from linear to OTT and direct-to-consumer consumption, during the second quarter of the fiscal year ended March 31, 2020, we determined it was appropriate to change the pattern of amortization of our Traditional Affiliate customer relationship intangible asset (i.e., a finite-lived intangible asset). Accordingly, beginning in the second quarter of the fiscal year ended March 31, 2020, the Company has adopted an amortization method that reflects amortization in the proportion that current period revenues bear to management’s estimate of future revenue over the remaining estimated useful life of the asset. This method results in greater amortization in the earlier years of the estimated useful life of the asset than the latter years.

During the fiscal year ended March 31, 2020, due to industry factors discussed in the preceding paragraph and the economic uncertainty from the COVID-19 global pandemic, we performed an impairment analysis of our amortizable intangible assets, as described above. The impairment analysis requires a comparison of undiscounted future cash flows expected to be generated over the useful life of an asset to the carrying value of the asset. Based on our impairment analysis, the estimated undiscounted cash flows exceeded the carrying amount of the assets and therefore no impairment charge was required.

Should the revenues from our Traditional Affiliate relationships decline more than the assumed attrition rates used in our current estimates, either as a result of decreases in subscriber rates or changes of the terms of our renewals of our Traditional Affiliate contracts, we may have indicators of impairment which could result in an impairment of our customer relationships intangible assets, or we may need to further shorten the useful life or adopt a more accelerated method of amortization. Both of these occurrences would increase the amount of amortization expense we record, which could have a material adverse effect on our financial condition and results of operations.

~~For further discussion, see~~ ~~Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Critical Accounting Policies~~.

Changes in our business strategy, plans for growth or restructuring ~~of our businesses~~ may increase our costs or otherwiseaffect ~~the profitability of~~ our ~~businesses.~~profitability.

As changes in our business environment occur, we may adjust our business strategies to meet these changes, which may include growing a particular area of business or restructuring a particular business or asset. In addition, external events including changing technology, changing consumer patterns, acceptance of our theatrical and television offerings and changes in macroeconomic condition, including the volatility and uncertainty in financial markets as a result of the ~~ongoing~~ COVID-19 global pandemic, ~~and its effects,~~ may impair the value of our assets. When these ~~changes or events~~ occur, we may incur costs to change our business strategy and may need to write down the value of assets. We may also make investments in existing or new businesses, including investments in the international expansion of our business and in new business ~~lines. Such investments have and continue to be made in our Global Live, Interactive and Location Based Entertainment and~~lines (e.g., our direct-to-consumer and licensed offerings (specifically, the international rollout of ~~our STARZPLAY service)~~STARZPLAY)). Some of these investments may have ~~short-term returns that are~~ negative or low short-term returns and the ultimate prospects of the businesses may be uncertain or, in international markets, may not develop at a rate that supports our level of investment. In any of these events, our costs may increase, we may have significant charges associated with the write-down of assets, or returns on new investments may be lower than prior to the change in strategy, plans for growth or restructuring.

~~We have entered into output licensing agreements that require Starz to make substantial payments.~~

Starz has an output licensing agreement with Sony to acquire theatrical releases that will expire on December 31, 2021. Starz is required to pay Sony for films released at rates calculated on a pricing grid that is based on each film’s domestic box office performance (subject to maximum amounts payable per film and a cap on the number of films that can be put to Starz each year), and the amounts payable pursuant to such agreement will be substantial. We believe that the theatrical performance of the films Starz will receive under the agreements will perform at levels consistent with the performance of films Starz has received from Sony in the past. We also assume a certain number of annual releases of first run films by Sony’s studios consistent with the number Starz received in prior years. Should the films perform at higher levels across the slate of films Starz receives or the quantity of films increase, then our payment obligations would increase and would have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects.

Our revenues and results of operations may fluctuate significantly.

~~Our results of operations are difficult to predict and depend on a variety of factors~~. Our results of operations depend significantly upon the commercial success of the motion picture, television and other content that we sell, license or distribute, which cannot be predicted with certainty. In particular, the underperformance at the box office of one or more motion pictures in any period may cause our revenue and earnings results for that period (and potentially, subsequent periods) to be less than anticipated, in some instances, to a significant extent. Additionally and as stated previously, we have experienced early termination of the theatrical run of one of our films domestically and one of our films in the UK, delayed theatrical distribution of several films domestically and internationally and delayed production of film and television content due to the ongoing COVID-19 global pandemic and its effects. Accordingly, our results of operations may fluctuate significantly from period to period, and the results of any one period may not be indicative of the results for any future periods.

Our results of operations also fluctuate due to the timing, mix, number and availability of our theatrical motion picture and home entertainment releases, as well as license periods for content. Our operating results may increase or decrease during a particular period or fiscal year due to differences in the number and/or mix of films released compared to the corresponding period in the prior fiscal year.

~~Low~~ Moreover, low ratings for television programming produced by us may lead to the cancellation of a program and can negatively affect future license fees for the cancelled program. If we decide to no longer air programming due to low ratings or other factors, we could incur significant programming impairments, which could have a material adverse effect on our results of operations in a given period.

Moreover, our results of operations may be impacted by the success of all of our theatrical releases, including critically acclaimed and award winning films. We cannot assure you that we will manage the production, acquisition and distribution of all future motion pictures successfully including critically acclaimed, award winning and/or commercially popular films or that we will produce or acquire motion pictures that will receive critical acclaim or perform well commercially. Any inability to achieve such commercial success could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

Our operating results also fluctuate due to our accounting practices (which are standard for the industry) which may cause us to recognize the production and marketing expenses in different periods than the recognition of related revenues, which may occur in later periods. For example, in accordance with generally accepted accounting principles and industry practice, we are required to expense film advertising costs as incurred, but are also required to recognize the revenue from any motion picture or television program over the entire revenue stream expected to be generated by the individual picture or television program. In addition, we amortize film and television programming costs using the “individual-film-forecast” method. Under this accounting method, we amortize film and television programming costs for each film or television program based on the following ratio:

~~Revenue earned by title in the current year-to-date period~~

~~Estimated total future revenues by title as of the beginning of the year~~

We regularly review, and revise when necessary, our total revenue estimates on a title-by-title basis. This review may result in a change in the rate of amortization and/or a write-down of the film or television asset to its estimated fair value. Results of operations in future years depend upon our amortization of our film and television costs. Periodic adjustments in amortization rates may significantly affect these results.

In addition, the comparability of our results may be affected by changes in accounting guidance or changes in our ownership of certain assets and businesses. Accordingly, our results of operations from year to year may not be directly comparable to prior reporting periods.

As a result of the foregoing and other factors, our results of operations may fluctuate significantly from period to period, and the results of any one period may not be indicative of the results for any future period.

We do not have long-term arrangements with many of our production or co-financing partners.

We typically do not enter into long term production contracts with the creative producers of motion picture and television content that we produce, acquire or distribute. Moreover, we generally have certain derivative rights that provide us with distribution rights to, for example, prequels, sequels and remakes of certain content we produce, acquire or distribute. ~~However, there~~There is no guarantee that we will produce, acquire or distribute future content by any creative producer or co-financing partner, and a failure to do so could adversely affect our business, financial condition, operating results, liquidity and prospects.

We rely on a few major retailers and distributors and the loss of any of those ~~retailers or distributors~~ could reduce our revenues and operating results.

A small number of other retailers and distributors account for a material percentage of our revenues. We do not have long-term agreements with retailers. We cannot assure you that we will continue to maintain favorable relationships with our retailers and distributors or that they will not be adversely affected by economic conditions, includingas a result of the ~~ongoing~~ COVID-19 global pandemic and its effects. ~~If any~~

Table of these retailers or distributors reduces or cancels a significant order or becomes bankrupt, it could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.Contents

We depend on distributors that carry our ~~Starz~~STARZ programming, and no assurance can be given that we will be able to maintain and renew these affiliation agreements on favorable terms or at all.

~~Starz~~

STARZ currently distributes programming through affiliation agreements with many distributors, including Altice, Amazon, AT&T, Charter, Comcast, Cox, DISH Network, Hulu and Verizon. These agreements are scheduled to expire at various dates through 2026. The largest distributors have significant leverage in their relationship with certain programmers, including ~~Starz.~~STARZ. Furthermore, ~~Starz~~STARZ depends on a limited number of major global partners to distribute its content internationally.

The renewal negotiation process for affiliation agreements is typically lengthy. In certain cases, renewals are not agreed upon prior to the expiration of a given agreement, while the programming typically continues to be carried by the relevant distributor pursuant to the other terms and conditions in the affiliation agreement. We may be unable to obtain renewals with our current distributors on acceptable terms, if at all. We may also be unable to successfully negotiate affiliation agreements with new distributors to carry our programming. The failure to renew affiliation agreements on acceptable terms, or the failure to negotiate new affiliation agreements at all, in each case covering a material portion of ~~multichannel television~~ households, could result in a discontinuation of carriage, or could otherwise materially adversely affect our subscriber growth, revenue and earnings which could materially adversely affect our business, financial condition, operating results, liquidity and prospects.Moreover, given the limited number of global partners, the loss of one more of ~~Starz~~STARZ global partners could materially adversely affect our international business, operating results, and growth prospects.

In some cases, if a distributor is acquired, the affiliation agreement of the acquiring distributor will govern following the acquisition. In those circumstances, the acquisition of a distributor that is party to affiliation agreements with us that are more favorable to us may adversely impact our business, financial condition, operating results, liquidity and prospects.

Increasing rates paid by distributors to other programmers may result in increased rates charged to their subscribers for their services, making it more costly for subscribers to purchase our STARZ services.

The amounts paid by distributors to certain programming networks for the rights to carry broadcast networks and sports networks have increased substantially in recent years. As a result, distributors have passed on some of these increases to their subscribers. The rates that subscribers pay for programming from distributors continue to increase each year and these increases may impact our ability, as a premium subscription video provider, to increase or even maintain our subscriber levels and may adversely impact our revenue and earnings which could have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~We depend on distributors to market Starz’s networks and other services, the lack of which may result in reduced customer demand.~~
At times, certain of our distributors do not allow us to participate in cooperative marketing campaigns to market Starz’s networks and services. Our inability to participate in the marketing of our networks and other services may put us at a competitive disadvantage. Also, our distributors are often focused more on marketing their bundled service offerings (video, Internet and telephone) than premium video services. If our distributors do not sign up new subscribers to our networks, we may lose subscribers which would have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~We must respond successfully to ongoing changes in the U.S. television industry and consumer viewing patterns to remain competitive.~~ We derive revenues and profits from our Starz networks and the production and licensing of television programming to broadcast and cable networks and other premium pay television services. The U.S. television industry is continuing to evolve rapidly, with developments in technology leading to new methods for the distribution of video content and changes in when, where and how audiences consume video content. These changes pose risks to the traditional U.S. television industry including the disruption of the traditional television content distribution model by OTT services, which are increasing in number and some of which have significant and growing subscriber/user bases. Over the past few years, the number of subscribers to traditional services in the U.S. has declined each year. Developments in technology and new content delivery products and services have also led to an increasing amount of video content that is available through OTT services and consumers spending an increased amount of time viewing such content, as well as changes in consumers’ expectations regarding the availability and packaging of video content, their willingness to pay for access to such content, their perception of what quality entertainment is and how much it should cost, and the ease for a consumer to unsubscribe or switch. We are engaged in efforts to respond to and mitigate the risks from these changes, including launching the Starz service on these OTT services and on a direct-to-consumer basis and making the STARZ service available on an authenticated basis via our app as an additional benefit to paying traditional subscribers of our premium

services. Growth in OTT service subscribers may be slower than the decline of service subscribers on traditional services in the U.S., and we may incur significant costs to implement our strategy and initiatives, and if we are not successful, our competitive position, businesses and results of operations could be adversely affected.

~~Our revenues and results of operations are vulnerable to currency fluctuations.~~ We report our revenues and results of operations in U.S. dollars, but a portion of our revenue is earned outside of the U.S. Our currency exposure is primarily between Canadian dollars, British pound sterling, Euros and U.S. dollars. We cannot accurately predict the impact of future exchange rate fluctuations on revenues and operating margins. Moreover, we may experience currency exposure on distribution and production revenues and expenses from foreign countries. This could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~The directional guidance we provide from time to time is subject to several factors that we may not be successful in achieving.~~ From time to time, we provide directional guidance for certain financial periods which depends on a number of factors that we may not be successful in achieving, including, but not limited to, the timing and commercial success of content that we distribute, which cannot be accurately predicted. In particular, underperformance at the box office of one or more motion pictures in any period (including because of early termination or even delayed theatrical distribution as a result of the ongoing COVID-19 global pandemic and its effects), may cause our revenue and earnings results for that period (and potentially, subsequent periods) to be less than anticipated, in some instances significantly. Accordingly, our results of operations may fluctuate significantly from period to period, and the results of any one period may not be indicative of the results for future periods. Management prepares directional guidance on the basis of available information at such time, and believes such estimates are prepared on a reasonable basis. However, such estimates should not be relied on as necessarily indicative of our actual financial results. Our inability to achieve directional guidance could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

A significant portion of our library revenues comes from a small number of ~~titles, a portion of which we may be limited in our ability to exploit.~~titles.

We depend on a limited number of titles in any given fiscal quarter for the majority of the revenues generated by our library. In addition, many of the titles in our library are not presently distributed and generate substantially no revenue. ~~Additionally,~~Moreover, our rights to the titles in our library vary; in some cases, we ~~have~~ only hold the right to distribute titles in certain media and territories for a limited term. If we cannot acquire new product and the rights to popular titles through production, distribution agreements, acquisitions, mergers, joint ventures or other strategic alliances, or renew expiring rights to titles generating a significant portion of our revenue on acceptable terms, any such failure could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~Failure to manage future growth may adversely affect our business.~~

We are subject to risks associated with possible acquisitions, dispositions, business combinations, or joint ventures.

From time to time, we engage in discussions and activities with respect to possible acquisitions, sale of assets, business combinations, or joint ventures intended to complement or expand our business. WeHowever, we may not realize the anticipated benefit from ~~any of~~ the transactions we ~~pursue.~~

~~Regardless~~pursue; there may be liabilities assumed that we did not discover or that we underestimated in the course of ~~whether we consummate any such transaction,~~performing our due diligence; the negotiation of ~~a potential~~the transaction and the integration of the acquired business could require us to incur significant costs and cause diversion of management's time and ~~resources. Any such~~resources; the transaction could ~~also~~ result in impairment of goodwill and other intangibles, development write-offs and other related ~~expenses. Such~~expenses; the transaction may pose challenges in the consolidation and integration of information technology, accounting systems, personnel and ~~operations. We~~operations; and we may ~~also~~ have difficulty managing the combined entity in the short term if we experience a significant loss of management personnel during the transition period after a significant acquisition. No assurance can be given that expansion or acquisition opportunities will be successful, completed on time, or that we will realize expected operating efficiencies, cost savings, revenue enhancements, synergies or other benefits. Any of the foregoing could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~We may seek claims against a seller for claims against us relating to any acquisition or business combination that theseller may not indemnify us for or that may exceed the seller's indemnification obligations.~~ There may be liabilities assumed in any acquisition or business combination that we did not discover or that we underestimated in the course of performing our due diligence. Although a seller generally will have indemnification obligations to us under an acquisition or merger agreement, these obligations usually will be subject to financial limitations, such as deductibles and maximum recovery amounts, as well as time limitations. We cannot assure you that our right to indemnification from any seller will be enforceable, collectible or sufficient in amount, scope or duration to fully offset the amount of any undiscovered or underestimated liabilities that we may incur. Any such liabilities could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~We may not be able to obtain additional funding to meet our requirements.~~ Our ability to grow through acquisitions, business combinations and joint ventures, to maintain and expand our development, production and distribution of motion pictures and television content, and to fund our operating expenses depends upon our ability to obtain funds through equity financing, debt financing (including credit facilities) or the sale or syndication of some or all of our interests in certain projects or other assets or businesses. If we do not have access to such financing arrangements, and if other funds do not become available on terms acceptable to us, there could be a material adverse effect on our business, financial condition, operating results, liquidity and prospects. Further, concerns over the COVID-19 global pandemic has caused extreme volatility in financial and other capital markets and impacted the ability to access capital on favorable terms. As a result of the impacts of the COVID-19 global pandemic, we may be required to raise additional capital and such additional debt financing may not be available on commercially reasonable terms, if at all.

~~Our dispositions may not aid our future growth.~~ If we determine to sell individual properties, libraries or other assets or businesses, we will benefit from the net proceeds realized from such sales. However, our revenues may suffer in the long term due to the disposition of a revenue generating asset, or the timing of such dispositions may be poor, causing us to fail to realize the full value of the disposed asset, all of which may diminish our ability to service our indebtedness and repay our notes and our other indebtedness at maturity. Furthermore, our future growth may be inhibited if the disposed asset contributed in a significant way to the diversification of our business platform.

~~Limitations on control of joint ventures may adversely impact our operations.~~

We hold our interests in certain businesses as a joint venture or in partnership with non-affiliated third parties. As a result of such arrangements, we may be unable to control the operations, strategies and financial decisions of such joint venture or partnership entities which could, in turn, result in limitations on our ability to implement strategies that we may favor and may limit our ability to transfer our interests. Consequently, any losses experienced by these entities could adversely impact our results of operations and the value of our investment.

Our success depends on attracting and retaining key personnel.

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Our success depends upon the continued efforts, abilities and expertise of our executive teams and other key employees, including production, creative and technical ~~personnel. Our success also depends~~personnel, including, in turn, on our ability to identify, attract, hire, train and retain such personnel. We have entered into employment agreements with top executive officers and production executives but do not currently have significant “key person” life insurance policies for any employee. Although it is standard in the industry to rely on employment agreements as a method of retaining the services of key employees, these agreements cannot assure us of the continued services of such employees. ~~In addition, competition for the limited number of business, production and creative personnel necessary to create and distribute our entertainment content is intense and may grow in the future.~~ We cannot assure you that we will be successful in identifying, attracting, hiring, training and retaining such personnel in the future, and our inability to do so could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

Our success depends on external factors in the motion picture and television industry.

~~Our success depends on the commercial success of motion pictures and television programming, which is unpredictable.~~Generally, the popularity of our programs depends on many factors, including the critical acclaim they receive, the format of their initial release, their talent, their genre and their specific subject matter, audience reaction, the quality and acceptance of ~~motion pictures or television~~ content that our competitors release into the marketplace at or near the same time, critical reviews, the availability of alternative forms of entertainment and leisure activities, general economic conditions and other tangible and intangible factors, many of which we do not control and all of which may change. ~~We cannot predict the future effects of these factors with certainty.~~ In addition, because a performance in ancillary markets, such as home video and pay and free television, is often directly related to its box office performance or television ratings, poor box office results or poor television ratings may negatively affect future revenue streams. Our success will depend on the experience and judgment of our management to select and develop new investment and production opportunities. We cannot assure you that our motion pictures and television programing will obtain favorable reviews or ratings, that our motion pictures will perform well at the box office or in ancillary markets, or that broadcasters will license the rights to broadcast any of our television programs in development or renew licenses to broadcast programs in our library. Additionally, we cannot assure you that any original programming content will appeal to our distributors and subscribers. The failure to achieve any of the foregoing could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

Our business ~~depends on the appeal of our content to distributors and subscribers, which is difficult to predict.~~ ~~Our business~~also depends in part upon viewer preferences and audience acceptance of ~~Starz’s~~STARZ’s network programming. These factors are difficult to

predict and are subject to influences beyond our control, such as the quality and appeal of competing programming, general economic conditions and the availability of other entertainment activities. We may not be able to anticipate and react effectively to shifts in tastes and interests in markets. A change in viewer preferences could cause ~~Starz’s~~STARZ’s programming to decline in popularity, which could jeopardize renewal of affiliation agreements with distributors. In addition, our competitors may have more flexible programming arrangements, as well as greater amounts of available content, distribution and capital resources and may be able to react more quickly than we can to shifts in tastes and interests.

To an increasing extent, the success of our business, including STARZ, depends on exclusive original programming and our ability to accurately predict how audiences will respond to our original programming. We must invest substantial amounts in the production and marketing of our original programming before we learn whether such content will reach anticipated audience acceptance levels. Because original programming often involves a greater degree of financial commitment, as compared to acquired programming that we license from third parties, and because our branding strategies depend significantly on a relatively small number of original series, a failure to anticipate viewer preferences for such series could be especially detrimental to our business.

In addition, theatrical feature films constitute a significant portion of the programming on our Starz networks. In general, the popularity of feature-film content on linear television is declining, due in part to the broad availability of such content through an increasing number of distribution platforms prior to our linear window. Should the popularity of feature-film programming suffer significant further declines, Starz may lose subscribership or be forced to rely more heavily on original programming, which could increase our costs.

If Starz’s programming does not gain the level of audience acceptance we expect, or if we are unable to maintain the popularity of Starz’s programming, we may have a diminished negotiating position when dealing with distributors, which could reduce our revenue and earnings. We cannot ensure that we will be able to maintain the success of any of Starz’s current programming, or generate sufficient demand and market acceptance for Starz’s new original programming. This could materially adversely impact our business, financial condition, operating results, liquidity and prospects.

~~Starz’s success depends upon the availability of programming that is adequate in quantity and quality at a reasonable cost, and we may be unable to secure or maintain such programming.~~ Starz’s success depends upon the availability of quality programming, particularly original programming and films that is suitable for its target markets. While we produce some of Starz’s original programming, we obtain most of Starz’s programming (including some of Starz’s original series, films and other acquired programming) through agreements with third parties that have produced or control the rights to such programming. These agreements expire at varying times and may be terminated by the other party if we are not in compliance with their terms.

We compete with other programming services, including cable programming, national broadcast television, local broadcast television stations and ~~SVOD~~digital services to secure desired programming, the competition for which has increased as the number of programming services has increased. Increased competition may drive up talent and production costs and may force some programming services to commit to straight-to-series orders for programming instead of a pilot order. If we commit to straight-to-series orders and those series do not meet anticipated production or quality standards or are otherwise not accepted by audiences, revisions to the programming may be necessary, which could increase production costs. The increased financial commitment for a straight-to-series order also could increase the risks associated with such an order. Other programming services that are affiliated with programming sources such as movie or television studios or film libraries may have a competitive advantage over us in this area. Some of these competitors have exclusive contracts with motion picture studios or independent motion picture distributors or own film libraries.

We cannot assure you that we will ultimately be successful in negotiating renewals of Starz’s programming rights agreements or in negotiating adequate substitute agreements. In the event that these agreements expire or are terminated and are not replaced by programming content, including additional original programming, acceptable to Starz’s distributors and subscribers, it would have a materially adverse impact on our business, financial condition, operating results, liquidity and prospects.

Global economic turmoil and regional economic conditions in the U.S. could adversely affect our business.

Global economic turmoil, such as that being created by the ~~ongoing~~ COVID-19 global pandemic and its effects, may cause a general tightening in the credit markets, lower levels of liquidity, increases in the rates of default andbankruptcy, levels of intervention from the U.S. federal government and other foreign governments, decreased consumer confidence, overall slower economic activity and extreme volatility in credit, equity and fixed income markets. A decrease in economic activity in the U.S. or in other regions of the world in which we do business could adversely affect demand for our content, thus reducing our revenues and earnings. A decline in economic conditions could reduce performance of our theatrical, television and home entertainment releases. In addition, an increase in price levels generally could result in a shift in consumer demand away from the entertainment we offer, which could also adversely affect our revenues and, at the same time, increase our costs. For instance, lower household income and decreases

in U.S. consumer discretionary spending, which is sensitive to general economic conditions, may affect cable television and other video service subscriptions, in particular with respect to digital programming

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packages, ~~on which our networks are typically carried and~~ premium video programming packages and premium a la carte services on which our networks are typically carried. A reduction in spending may cause a decrease in subscribers to our networks, which could have a materially adverse impact on our business, financial condition, operating results, liquidity and prospects. Moreover, financial institution failures may cause us to incur increased expenses or make it more difficult to finance any future acquisitions, or engage in other financing activities. It is likely that the current outbreak or continued spread of COVID-19 will cause a global recession, which will further adversely affect our business, and such adverse effects may be material. In addition, the magnitude, duration and speed of the global pandemic is uncertain. We cannot guarantee that we will recover as rapidly as other industries, or that we will recover as rapidly as others within the industry. As a consequence, we cannot estimate the impact on our business, financial condition or near or longer-term financial or operational results with certainty.

We could be adversely affected by strikes or other union job actions.

We are directly or indirectly dependent upon highly specialized union members who are essential to the production of motion pictures and television content. A strike by, or a lockout of, one or more of the unions that provide personnel essential to the production of motion pictures or television content could delay or halt our ongoing production activities, or could cause a delay or interruption in our release of new motion pictures and television content. A strike may result in increased costs and decreased revenue, which could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

Business interruptions could adversely affect our operations.

Our operations are vulnerable to outages and interruptions due to fire, floods, power loss, telecommunications failures, pandemics such as the COVID-19 global pandemic, and similar events beyond our control. Our headquarters are located in Southern California, which is subject to earthquakes. Although we have developed certain plans to respond in the event of a disaster, there can be no assurance that they will be effective in the event of a specific disaster. In the event of a short-term power outage, we have installed uninterrupted power source equipment designed to protect our equipment. A long-term power outage, however, could disrupt our operations. We ~~have~~ also experienced a disruption to our business as a result of the COVID-19 global pandemic, which, ~~has~~in certain instances, suspended production of our programming. Although we currently carry business interruption insurance for potential losses (including earthquake-related losses), there can be no assurance that such insurance will be sufficient to compensate us for losses that may occur or that such insurance may continue to be available on affordable terms. Any losses or damages incurred by us could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

STARZ’s programming is transmitted from STARZ’s uplink center in Englewood, Colorado. STARZ uses this center for a variety of purposes, including signal processing, satellite uplinking, program editing, on-air promotions, creation of programming segments (i.e., interstitials) to fill short gaps between featured programs, quality control and live and recorded playback. STARZ’s uplink center is equipped with backup generator power and other redundancies. However, like other facilities, this facility is subject to interruption from fire, lightning, adverse weather conditions and other natural causes. Equipment failure, employee misconduct or outside interference could also disrupt the facility’s services. STARZ has made arrangements at a third-party facility to uplink STARZ’s linear channels and services to STARZ’s satellites in the event STARZ is unable to do so from this facility. Additionally, STARZ has direct fiber connectivity to certain of STARZ’s distributors, which would allow continuous operation with respect to a significant segment of STARZ’s subscriber base in the event of a satellite transmission interruption. Notwithstanding these precautions, any significant or prolonged interruption of operations at STARZ’s facility, and any failure by STARZ’s third-party facility to perform as intended, would have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects. In addition, our success in the U.S. is dependent upon our continued ability to transmit STARZ’s programming to distributors through STARZ’s satellite uplink facility. STARZ has entered into long-term satellite transponder leases that expire in 2023 for carriage of the STARZ networks’ programming. These leases provide for replacement transponders and/or replacement satellites, as applicable, throughout the term of the leases to ensure continued carriage of STARZ programming in the event of transponder or satellite failures. Termination or interruption of satellite transmissions may occur and could have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects. Despite STARZ’s efforts to secure transponder capacity with long-term satellite transponder leases, there is a risk that when these leases expire, we may not be able to secure capacity on a transponder on the same or similar terms, if at all.

We face substantial competition in all aspects of our business.

We are ~~smaller and less diversified than many of our competitors.~~ ~~Unlike us,~~ an independent distributor and ~~producer, most~~producer. Most of the major U.S. studios are part of large diversified corporate groups with a variety of other operations that can provide both the means of distributing their products and stable sources of earnings that may allow them to better offset fluctuations in the financial performance of their motion picture and television operations. The major studios also have more resources with which to compete for ideas, storylines and scripts created by third parties as well as for actors, directors and other personnel required for production. These resources may also give them an advantage in acquiring other businesses or assets, including film libraries, that we might also be interested in acquiring.

~~The motion picture industry is highly competitive.~~ The number of motion pictures released by our competitors may create an oversupply of product in the market, reduce our share of box office receipts and make it more difficult for our films to succeed commercially. The limited supply of motion picture screens compounds this product oversupply problem, which may be most pronounced during peak release times such as holidays, when theater attendance is expected to be highest. As a result of changes in the theatrical exhibition industry, including reorganizations and consolidations, and major studio releases occupying more screens, the number of screens available to us when we want to release a picture may decrease. If the number of motion picture screens decreases, box office receipts, and the correlating future revenue streams, such as from home entertainment and pay and free television, of our motion pictures may also decrease. Moreover, we cannot guarantee that we can release all of our films when they are otherwise scheduled due to production or other delays, or a change in the schedule of a major studio. Any such change could adversely impact a film's financial performance. In addition, if we cannot change our schedule after such a change by a major studio because we are too close to the release date, the major studio's release and its typically larger promotion budget may adversely impact the financial performance of our film.

~~The home entertainment industry is highly competitive.~~ We compete with all of the major U.S. studios which distribute their theatrical, television and titles acquired from third parties on DVDs/Blu-ray discs and other media and have marketing budgets greater than ours. We not only compete for ultimate consumer sales, but also with these parties and independent home entertainment distributors for location and shelf space placement at retailers and other distributors. The quality and quantity of titles as well as

~~the quality of our marketing programs determines how much shelf space we are able to garner at any given time as retailers and other distributors look to maximize sales.~~

We also compete with U.S. studios and other distributors that may have certain competitive advantages over us to acquire the rights to sell or rent DVDs/Blu-ray discs and other media. Our ability to license and produce quality content in sufficient quantities has a direct impact on our ability to acquire shelf space at retail locations and on websites. In addition, certain of our content is obtained through agreements with other parties that have produced or own the rights to such content, while other U.S studios may produce most of the content they distribute.

Our DVDs/Blu-ray discs sales and other media sales are also impacted by myriad choices consumers have to view entertainment content, including over-the-air broadcast television, cable television networks, online services, mobile services, radio, print media, motion picture theaters and other sources of information and entertainment. The increasing availability of content from these varying media outlets may reduce our ability to sell DVDs/ Blu-ray discs and other media in the future, particularly during difficult economic conditions.

~~We are subject to intense competition for marketing and carriage of our Starz networks.~~ ~~The~~ subscription video programming industry is highly competitive. Our ~~Starz~~STARZ networks compete with other programming networks and other video programming services for marketing and distribution by distributors. We face intense competition from other providers of programming networks for the right to be carried by a particular distributor and for the right to be carried by such distributor on a particular “tier” or in a particular “package” of service. Certain programming networks affiliated with broadcast networks like ABC, CBS, Fox or NBC or other programming networks affiliated with sports and

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certain general entertainment networks with strong viewer ratings, have a competitive advantage over our networks in obtaining distribution through the “bundling” of carriage agreements for such programming networks with a distributor’s right to carry the affiliated broadcasting network. The inability of our programming networks to be carried by one or more distributors, or the inability of our programming networks to be placed on a particular tier or programming package could have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects.

We must successfully respond to ~~rapid~~ technological changes and alternative forms of delivery or storage to remain competitive.

The entertainment industry continues to undergo significant developments as advances in technologies and new methods of product delivery and storage (including the emergence of alternative distribution platforms), and certain changes in consumer behavior driven by these developments emerge. New technologies affect the demand for our content, the manner in which our content is distributed to consumers, the sources and nature of competing content offerings and the time and manner in which consumers acquire and view our content. New technologies also may affect our ability to maintain or grow our business and may increase our capital expenditures. We and our distributors must adapt our businesses to shifting patterns of content consumption and changing consumer behavior and preferences through the adoption and exploitation of new technologies.

For instance, such changes may impact the revenue we are able to generate from traditional distribution methods by decreasing the viewership of our networks on systems of cable operators, satellite television providers and telecommunication companies, or by decreasing the number of households subscribing to services offered by those distributors. If we cannot successfully exploit these and other emerging technologies, our appeal to targeted audiences might decline which could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~Any extended inability to transmit Starz’s programming via satellite would result in lost revenue and couldresult in lost subscribers~~.

Our success is in the U.S. dependent upon our continued ability to transmit Starz’s programming to distributors through Starz’s satellite uplink facility. Starz has entered into long-term satellite transponder leases that expire in 2023 for carriage of the Starz networks’ programming. These leases provide for replacement transponders and/or replacement satellites, as applicable, throughout the term of the leases to ensure continued carriage of Starz programming in the event of transponder or satellite failures. Although we believe that we take reasonable and customary measures to ensure continued satellite transmission capability, termination or interruption of satellite transmissions may occur and could have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects.

Despite Starz’s efforts to secure transponder capacity with long-term satellite transponder leases, there is a risk that when these leases expire, we may not be able to secure capacity on a transponder on the same or similar terms, if at all. This may result in an inability to transmit content and could result in significant lost revenue and lost subscribers and would have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects.

~~If Starz’s technology facilities fail or their operations are disrupted, our business also could be damaged.~~

Starz’s programming is transmitted from Starz’s uplink center in Englewood, Colorado. Starz uses this center for a variety of purposes, including signal processing, satellite uplinking, program editing, on-air promotions, creation of programming segments (i.e., interstitials) to fill short gaps between featured programs, quality control and live and recorded playback. Starz’s uplink center is equipped with backup generator power and other redundancies. However, like other facilities, this facility is subject to interruption from fire, lightning, adverse weather conditions and other natural causes. Equipment failure, employee misconduct or outside interference could also disrupt the facility’s services. Starz has made arrangements at a third-party facility to uplink Starz’s linear channels and services to Starz’s satellites in the event Starz is unable to do so from this facility. Additionally, Starz has direct fiber connectivity to certain of Starz’s distributors, which would allow continuous operation with respect to a significant segment of Starz’s subscriber base in the event of a satellite transmission interruption. Notwithstanding these precautions, any significant or prolonged interruption of operations at Starz’s facility, and any failure by Starz’s third-party facility to perform as intended, would have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects.

We face economic, political, regulatory, and other risks from doing business internationally.

We distribute content outside the U.S. and derive revenues from international sources. As a result, our business is subject to certain risks inherent in international business, many of which are beyond our control. These risks may include:

difficulties in understanding and complying with local laws, regulations and customs in foreign jurisdictions;

the loss of one or more of the major global partners that we rely upon to distribute our programming internationally;

laws and policies adversely affecting trade, investment and taxes, including laws and policies relating to the repatriation of funds and withholding taxes, and changes in these laws;

the impact of trade disputes;

anti-corruption laws and regulations such as the Foreign Corrupt Practices Act and the U.K. Bribery Act that impose strict requirements on how we conduct our foreign operations and changes in these laws and regulations;

changes in local regulatory requirements including regulations designed to stimulate local productions, promote and preserve local culture and economic activity (including local content quotas, investment obligations, local ownership requirements, and levies to support local film funds); or censorship requirements that may cause us to remove or edit popular content, leading to consumer disappointment, brand tarnishment or consumer dissatisfaction;

regulatory requirements or government action against our service, whether in response to enforcement of actual or purported legal and regulatory requirements or otherwise, that results in disruption or non-availability of our service or particular content in the applicable jurisdiction;

inability to adapt our offerings successfully to differing languages, cultural tastes, and preferences in international markets;

international jurisdictions where laws are less protective of intellectual property and varying attitudes towards the piracy of intellectual property;

laws and policies relating to data privacy and security such as the European Union General Data Protection Regulation;

establishing and protecting a new brand identity in competitive markets;

financial instability and increased market concentration of buyers in foreign television markets, including in European pay television markets;

the instability of foreign economies and governments;

currency exchange restrictions, export controls and currency devaluation risks in some foreign countries;

the spread of communicable diseases (such as the ~~current~~ COVID-19 global pandemic), which may impact business in such jurisdictions; and

war and acts of terrorism.

Additionally, with respect to our direct-to-consumer offerings, these risks may include:

differing technical, architectural and payment processing systems and costs as well as consumer use and acceptance of electronic payment methods, such as credit cards;

availability of reliable broadband connectivity and wide area networks in targeted areas for expansion;

low usage and/or penetration of internet-connected consumer electronic devices;

new and different sources of competition; and

laws and policies relating to consumer protection.

Events or developments related to these and other risks associated with international trade could adversely affect our revenues from non-U.S. sources, which could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

We are managing and adjusting our international business to address varied content offerings, consumer customs and practices, in particular those dealing with e-commerce and streaming video, as well as differing and changing legal and regulatory environments. As online streaming grows in international markets, governments may look to introduce new or extend legacy regulations to these services, in particular those related to broadcast media, consumer privacy and tax. While we believe our legal and regulatory positions are consistent with the laws and regulations in the jurisdictions in which we conduct our business, it is possible that we will be required to comply with new regulations or legislation or new interpretations of existing regulations or legislation. In such an event, increased jurisdictional legal or regulatory oversight and/or action could cause us to incur additional expenses or alter our business model.

Protecting and defending against intellectual property claims may have a material adverse effect on our business.

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Our ability to compete depends, in part, upon successful protection of our intellectual property. We attempt to protect proprietary and intellectual property rights to our productions through available copyright and trademark laws and licensing and distribution arrangements with reputable international companies in specific territories and media for limited durations. Despite these precautions, existing copyright and trademark laws afford only limited practical protection in certain countries where we distribute our products. As a result, it may be possible for unauthorized third parties to copy and distribute our productions or certain portionsor applications of our intended productions, which could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

Litigation may also be necessary to enforce our intellectual property rights, to protect our trade secrets, or to determine the validity and scope of the proprietary rights of others or to defend against claims of infringement or invalidity. Any such litigation, infringement or invalidity claims could result in substantial costs and the diversion of resources and could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

Our more successful and popular film or television products or franchises may experience higher levels of infringing activity, particularly around key release dates. Alleged infringers have claimed and may claim that their products are permitted under fair use or similar doctrines, that they are entitled to compensatory or punitive damages because our efforts to protect our intellectual property rights are illegal or improper, and that our key trademarks or other significant intellectual property are invalid. Such claims, even if meritless, may result in adverse publicity or costly litigation. We vigorously defend our copyrights and trademarks from infringing products and activity, which can result in litigation. We may receive unfavorable preliminary or interim rulings in the course of litigation, and there can be no assurance that a favorable final outcome will be obtained in all cases. Additionally, one of the risks of the film and television production business is the possibility that others may claim that our productions and production techniques misappropriate or infringe the intellectual property rights of third parties. From time to time we are subject to claims and legal proceedings regarding alleged infringement by us of the intellectual property rights (including patents) of third parties. Such claims, whether or not meritorious, may result in the expenditure of significant financial and managerial resources, require the development of alternative technology or business practices, injunctions against us, or payments for licenses or damages. These risks have been amplified by the increase in third parties ~~with respect~~whose sole or primary business is to ~~their previously developed films and televisions series, stories, characters, other entertainment or intellectual property.~~assert such claims. Regardless of the validity or the success of the assertion of any such claims, we could incur significant costs and diversion of resources in enforcing our intellectual property rights or in defending against such claims, which could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

Our business involves risks of liability claims for content of material, which could adversely affect our business, results of operations and financial condition.

As a distributor of media content, we may face potential liability for defamation, invasion of privacy, negligence, copyright or trademark infringement, ~~(as discussed above),~~ and other claims based on the nature and content of the materials distributed. These types of claims have been brought, sometimes successfully, against producers and distributors of media content. Any imposition of liability that is not covered by insurance or is in excess of insurance coverage could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects.

Piracy of films and television programs could adversely affect our business over time.

Piracy is extensive in many parts of the world and is made easier by the availability of digital copies of content and technological advances allowing conversion of films and television content into digital formats. This trend facilitates the creation, transmission and sharing of high quality unauthorized copies of motion pictures and television content. The proliferation of unauthorized copies of these products has had and will likely continue to have an adverse effect on our business, because these products reduce the revenue we receive from our products. In order to contain this problem, we may have to implement elaborate and costly security

and anti-piracy measures, which could result in significant expenses and losses of revenue. We cannot assure you that even the highest levels of security and anti-piracy measures will prevent piracy.

In particular, unauthorized copying and piracy are prevalent in countries outside of the U.S., Canada and Western Europe, whose legal systems may make it difficult for us to enforce our intellectual property rights. While the U.S. government has publicly considered implementing trade sanctions against specific countries that, in its opinion, do not make appropriate efforts to prevent copyright infringements of U.S. produced motion pictures and television content, there can be no assurance that any such sanctions will be enacted or, if enacted, will be effective. In addition, if enacted, such sanctions could impact the amount of revenue that we realize from the international exploitation of our content.

Service disruptions or failures of the Company’s or our vendors’ information systems and networks as a result of computer viruses, misappropriation of data or other bad acts, natural disasters, extreme weather, accidental releases of information or other similar events, may disrupt our businesses, damage our reputation or have a negative impact on our results of operations.

Shutdowns or service disruptions of our information systems or networks or to vendors that provide information systems, networks or other services to us pose increasing risks. Such disruptions may be caused by third-party hacking of computers and systems; dissemination of computer viruses, worms and other destructive or disruptive software; denial of service attacks and other bad acts, as well as power outages, natural disasters, extreme weather, terrorist attacks, pandemics (such as the ~~ongoing~~ COVID-19 global pandemic), or other similar events. Shutdowns or disruption from such events could have an adverse impact on us and our customers, including degradation or disruption of service, loss of data, release or threatened release of data publicly, misuse or threatened misuse of data, and damage to equipment and data. System redundancy may be ineffective or inadequate, and our disaster recovery planning may not be sufficient to cover everything that could happen. Significant events could result in a

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disruption of our operations, reduced revenues, the loss of or damage to the integrity of data used by management to make decisions and operate our business, damage to our reputation or brands or a loss of customers. We may not have adequate insurance coverage to compensate it for any losses associated with such events.

We are also subject to risks caused by the misappropriation, misuse, falsification or intentional or accidental release or loss of data maintained in our information systems and networks or of our vendors, including sensitive or confidential personnel, customer or vendor data, business information or other sensitive or confidential information (including our content). We maintain this information and data either on our own systems or on those of third party vendors. While we take measures to protect against unauthorized intrusion into this information, we, or the vendors we use, could experience an unauthorized intrusion. The number and sophistication of attempted and successful information security breaches have increased in recent years and, as a result, the risks associated with such an event continue to increase. We expect that outside parties will attempt to penetrate our systems and those of our vendors or fraudulently induce our employees or customers or employees of our vendors to disclose sensitive or confidential information to obtain or gain access to our data, business information or other sensitive or confidential information. If a material breach of our information systems or those of our vendors occurs, the market perception of the effectiveness of our information security measures could be harmed, we could lose customers, our revenues could be adversely affected and our reputation, brands and credibility could be damaged. Current and potential customers may become unwilling to provide the information to us necessary for them to remain or become customers. We also may be required to notify regulators about any actual or perceived data breach (including the EU Lead Data Protection Authority) as well as the individuals who are affected by the incident within strict time periods. In addition, if a material breach of our information systems occurs, we could be required to expend significant amounts of money and other resources to review data and systems to determine the extent of any breach, repair or replace information systems or networks or to comply with notification requirements. We could be subject to actions by regulatory authorities and claims asserted in private litigation in the event of a breach of our information systems or our vendors.

The costs relating to any data breach could be material. Although we develop and maintain information security practices and systems designed to prevent these events from occurring, the development and maintenance of these systems are costly and require ongoing monitoring and updating as technologies change and tactics to overcome information security measures become more sophisticated. Despite our efforts, the possibility of these events occurring cannot be eliminated entirely. Moreover, the techniques used by parties seeking to evade the information security practices and systems to infiltrate, disrupt, or for some other hostile purpose change rapidly and often are not recognized until launched against some targets. Information security risks will continue to increase, and we will need to expend additional resources to protect our information systems, networks, data, business information and other sensitive or confidential information as we distribute more of our content digitally, engage in more electronic transactions directly with consumers, acquire more consumer data, including information about consumers’ viewing behavior, their credit card information and other personal data, increase the number of information technology systems used in our business operations, rely on cloud-based services and information systems and increases our use of third-party service providers to perform information technology services.

~~Protection of electronically stored data is costly and if our data is compromised in spite of this protection, we may incur additionalcosts, lost opportunities and damage to our reputation.~~

We maintain information in digital form as necessary to conduct our business, including confidential and proprietary information, copies of films, television programs and other content and personal information regarding our employees. Data maintained in digital form is subject to the risk of intrusion, tampering and theft. We develop and maintain systems to prevent this from occurring, but it is costly and requires ongoing monitoring and updating as technologies change and efforts to overcome security measures become more sophisticated. Moreover, despite our efforts, the possibility of intrusion, tampering and theft cannot be eliminated entirely, and risks associated with each of these remain. In addition, we provide confidential information, digital content and personal information to third parties when it is necessary to pursue business objectives. While we obtain assurances that these third parties will protect this information and, where appropriate, monitor the protections employed by these third parties, there is a risk that data systems of these third parties may be compromised. If our data systems or data systems of these third parties are compromised, our ability to conduct our business may be impaired, we may lose profitable opportunities or the value of those opportunities may be diminished and we may lose revenue as a result of unlicensed use of our intellectual property. A breach of our network security or other theft or misuse of confidential and proprietary information, digital content or personal employee information could subject us to business, regulatory, litigation and reputation risk, which could have a materially adverse effect on our business, financial condition and results of operations.

~~We are subject to payment processing risk.~~

Our subscribers pay for our services using a variety of different payment methods, including credit and debit cards. We rely on internal systems as well as those of third parties to process payment. Acceptance and processing of these payment methods are subject to certain rules and regulations, including additional authentication requirements for certain payment methods, and require payment of interchange and other fees. To the extent there are increases in payment processing fees, material changes in the payment ecosystem, such as large re-issuances of payment cards, delays in receiving payments from payment processors, changes to rules or regulations concerning payments, loss of payment partners and/or disruptions or failures in our payment processing systems, partner systems or payment products, including products we use to update payment information, our revenue, operating expenses and results of operation could be adversely impacted. In certain instances, we leverage third parties such as our cable and other partners to bill subscribers on our behalf. If these third parties become unwilling or unable to continue processing payments on our behalf, we would have to transition subscribers or otherwise find alternative methods of collecting payments, which could adversely impact subscriber acquisition and retention. In addition, from time to time, we encounter fraudulent use of payment methods, which could impact our results of operations and if not adequately controlled and managed could create negative consumer perceptions of our service. If we are unable to maintain our fraud and chargeback rate at acceptable levels, card networks may impose fines, our card approval rate may be impacted and we may be subject to additional card authentication requirements. The termination of our ability to process payments on any major payment method would significantly impair our ability to operate our business.

Our activities are subject to a variety of laws and regulations which may adversely impact our operations or, if violated, couldsubject us to an increased risk of litigation and regulatory actions.

~~Privacy~~Privacy. The global legal and ~~Child Protection Regulations. In addition to~~regulatory environment governing our ~~company websites~~collection, use, storage, and ~~applications, we use third-party applications, websites, and social media platforms to promote our projects and engage consumers, as well as monitor and collect certain information about users~~transfer of ~~our online forums. Privacy concerns could limit our ability to collect and leverage subscriber~~ personal information is complex, and ~~other data and disclosure of subscriber personal information and other data could adversely impact our business and reputation.~~continually evolving. In the ordinary course of our business, we collect and ~~utilize information supplied by our subscribers, which may include~~use the personal information of subscribers and potential subscribers through our websites and applications and those of third parties. Among other ~~data. The manner in which~~purposes, we ~~acquire, store, disclose,~~ use this information to engage with users, promote our programming, and ~~protect such subscriber~~monitor the use of our digital platforms. Our collection and use of personal information is ~~regulated,~~governed by a number of complicated domestic and international data privacy and security laws and regulations, including but not limited to Regulation (EU) 2016/679, ~~(also known as the~~ General Data Protection Regulation ~~or “GDPR”~~(“GDPR”) and the California Consumer Privacy Act of 2018 (“CCPA”),. Complying with these and ~~various~~any future regulations, or related contractual or other ~~domestic~~obligations, may increase our operating costs and ~~international privacy~~adversely impact our ability to market products and ~~data security laws~~service customers, including through our STARZ direct-to-consumer business (which may be subject to additional consumer legal claims and regulations, which are continually evolving. There are also a variety of laws, rules and regulations are aimed at protecting all individuals, including children who use the internet such as the Children’s Online Privacy and Protection Act of 1998 (“COPPA”)increased regulation). ~~COPPA sets forth, among other things, a number of restrictions on what website operators can present to children under the age of 13 and what information can be collected from them.~~ Any actual or perceived failure to comply with these or any future regulations, or related contractual or other obligations, could disrupt our business, inhibit our ability to retain existing customers or ~~any perceived privacy rights violation, could~~attract new customers, lead to investigations, claims, and proceedings by governmental entities and private parties, damages for breach of contract, ~~breach,~~ and other significant costs, fines, penalties, or other liabilities, as well as harm to our reputation and market position.

Increased regulation of data utilization practices, including self-regulation or findings under existing laws that limit our ability to collect, transfer and use information and other data, could have an adverse effect on our business. In addition, if we were to disclose information and other data about our subscribers in a manner that was objectionable to them, our business reputation could be

adversely affected, and we could face potential legal claims that could impact our operating results. Internationally, we may become subject to additional and/or more stringent legal obligations concerning our treatment of customer and other personal information, such as laws regarding data localization and/or restrictions on data export. Failure to comply with these obligations could subject us to liability, and to the extent that we need to alter our business model or practices to adapt to these obligations, we could incur additional expenses.

~~Additionally, as we grow our STARZ direct-to-consumer business, we may be subject to additional consumer legal claims and state and local consumer protection regulation.~~

Network ~~Regulations~~Regulations. . Under the Communications Act of 1934 and the 1992 Cable Act, there are certain FCC regulations that govern the distribution of our ~~network business.~~services by traditional MVPDs, including cable, DBS and telco operators. Furthermore, to the extent that regulations and laws, either presently in force or proposed, hinder or stimulate the growth of the cable television and satellite industries, our network business will be affected.As we continue to expand internationally, we also may be subject to varying degrees of local government regulations.

Regulations governing our ~~network businesses~~services are subject to the political process and have been in constant flux historically. ~~Further material changes in the law and regulatory requirements must be anticipated.~~ We cannot assure you that we will be able to anticipate material changes in laws or regulatory requirements or that future legislation, new regulation or deregulation will not have a materially adverse effect on our business, financial condition, operating results, liquidity and prospects.

Internet and Other Media Operator ~~Regulations~~Regulations.. The adoption or modification of laws or regulations relating to the internet or other areas of our business could limit or otherwise adversely affect the manner in which we currently conduct our business. ~~For example, recent changes to European law may cause some individual member states to attempt to impose levies and other financial obligations on media operators located outside their jurisdiction.~~ We anticipate that several jurisdictions may, over time, attempt to impose additional financial and regulatory obligations ~~on us. In addition, the continued growth and development of the market for online commerce may lead to more stringent consumer protection laws, which may impose additional burdens~~ on us. If we are required to comply with new regulations or legislation or new interpretations of existing regulations or legislation, this compliance could cause us to incur additional expenses or alter our business model. Additionally, as we grow our STARZ direct-to-consumer business, we may be subject to additional consumer legal claims and state and local consumer protection regulation.

Changes in laws or regulations that adversely affect the growth, popularity or use of the internet, including laws impacting net neutrality, could decrease the demand for our service and increase our cost of doing business. Certain laws intended to prevent network operators from discriminating against the legal traffic that traverse their networks have been implemented in many countries, including across the European Union. In others, the laws may be nascent or non-existent. These laws may change, including for example, in the United States where net neutrality regulations were repealed. Given uncertainty around these rules, ~~including changing interpretations, amendments or repeal,~~ coupled with potentially significant political and economic power of local network operators, we could experience

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discriminatory or anti-competitive practices that could impede our growth, cause us to incur additional expense or otherwise negatively affect our business.

~~While we believe we currently have adequate internal control over financial reporting, we are required to assess our internal~~control over financial reporting on an annual basis and any future adverse results from such assessment could result in a loss of investor confidence in our financial reports and have an adverse effect on our securities.

Section 404 of the Sarbanes-Oxley Act of 2002 and the accompanying rules and regulations promulgated by the SEC to implement it require us to include in our Annual Report on Form 10-K an annual report by our management regarding the effectiveness of our internal control over financial reporting. The report includes, among other things, an assessment of the effectiveness of our internal control over financial reporting as of the end of our fiscal year. This assessment must include disclosure of material weaknesses in our internal control over financial reporting identified by management. If our management identifies any such material weakness that cannot be remediated in a timely manner, we will be unable to assert such internal control is effective. While we believe our internal control over financial reporting is effective, the effectiveness of our internal controls in future periods is subject to the risk that our controls may become inadequate because of changes in conditions, and, as a result, the degree of compliance of our internal control over financial reporting with the applicable policies or procedures may deteriorate. If we are unable to conclude that our internal control over financial reporting is effective (or if our independent auditors disagree with our conclusion), we may lose investor confidence in the accuracy and completeness of our financial reports, which could have an adverse effect on our securities.

Any decisions to reduce or discontinue paying cash dividends to our shareholders or repurchase our common shares pursuant to our previously announced share repurchase program could cause the market price for our common shares to decline.

Our Board of Directors assesses relevant factors when considering the declaration of a dividend on or repurchases of our common stock. Our payment of quarterly cash dividends and repurchases of our common shares pursuant to our share purchase program will be subject to, among other things, our financial position and results of operations, available cash and cash flow, capital requirements, and other factors. Any reduction or discontinuance by us of the payment of quarterly cash dividends or repurchases of our common shares pursuant to our share repurchase program could cause the market price of our common shares to decline. Moreover, in the event our payment of quarterly cash dividends or repurchases of our common shares are reduced or discontinued, our failure or inability to resume paying cash dividends or repurchasing our common shares at historical levels could result in a lower market valuation of our common shares.

Risks Related To Our Indebtedness

We have incurred significant indebtedness that could adversely affect our operations and financial condition.

We currently have a substantial amount of indebtedness. As of March 31, ~~2020,~~2021, we and our subsidiaries have corporate debt of approximately ~~$2,741.9~~$2,676.9 million, ~~finance lease obligations of approximately $42.4 million and~~ production loan obligations of approximately ~~$151.4~~$373.5 million, and advances outstanding of $120.0 million under our senior secured revolving credit facility based on collateral consisting of certain of the Company's tax credit receivables (the "Production Tax Credit Facility"), and the Senior Credit Facilities provide for unused commitments of $1.5 billion. On the same basis, approximately ~~$1,720.0~~$1,612.6 million of such indebtedness is secured ~~(including all of our finance lease obligations but excluding~~(excluding all of our production loan ~~obligations)~~obligations and Production Tax Credit Facility borrowings).

Our high level of debt could have adverse consequences on our business, such as:

making it more difficult for us to satisfy our obligations with respect to our notes and our other debt;

limiting our ability to refinance such indebtedness or to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements;

requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, acquisitions and other general corporate purposes;

increasing our vulnerability to the ~~ongoing~~ COVID-19 global pandemic and its effects, economic downturns and adverse developments in our business;

exposing us to the risk of increased interest rates as certain of our borrowings, including borrowings under the Senior Credit Facilities and advances under the Production Tax Credit Facility, are at variable rates of interest;

limiting our flexibility in planning for, and reducing our flexibility in reacting to, changes in the conditions of the financial markets and our industry;

placing us at a competitive disadvantage compared to other, less leveraged competitors;

increasing our cost of borrowing; and

restricting the way in which we conduct our business because of financial and operating covenants in the agreements governing our existing and future indebtedness and exposing us to potential events of default (if not cured or waived) under covenants contained in our debt instruments.

In addition, the Senior Credit Facilities and the ~~indentures~~indenture that ~~govern~~governs our ~~6.375%~~5.500% Senior Notes due ~~2024~~2029 issued in ~~February 2019~~April 2021 (the “6.375% Senior Notes”), our 5.875% Senior Notes due 2024 issued in October 2016 (the “2016 5.875% Senior Notes”) and our new 5.875% Senior Notes due 2024 issued in March 2018 (the “2018 5.875% Senior Notes” and, together with the 2016 5.875% Senior Notes, the “5.875% Senior“Senior Notes”) each contain restrictive covenants limiting our ability to engage in activities that may be in our long-term best interest. Our failure to comply with those covenants could result in an event of default which, if not cured or waived, could result in acceleration of all our debt.

We may not be able to generate sufficient cash to service all of our indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.

A significant portion of our cash flows from operations is expected to be dedicated to the payments of principal and interest obligations under the Senior Credit Facilities ~~the 6.375% Senior Notes~~ and ~~the 5.875%~~ Senior Notes. Our ability to make scheduled payments on or refinance our debt obligations will depend on our financial condition and operating performance, which are subject to prevailing economic and competitive conditions and to certain financial, business, legislative, regulatory and other factors beyond our control, including the ~~ongoing~~ COVID-19 global pandemic and its effects. If our cash flow from operations declines significantly, including any decline related to the impact of the ~~ongoing~~ COVID-19 global pandemic, it could result in the inability to pay the principal, premium, if any, and interest on our indebtedness.

If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures or to dispose of material assets or operations,

seek additional debt or equity capital or restructure or refinance our indebtedness. In addition, during times of economic instability, including ~~recent~~ disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from the ~~ongoing~~ COVID-19 global pandemic, it has been difficult for many companies to obtain financing in the public markets or to obtain debt financing. We may not be able to effect any such alternative measures, if necessary, on commercially reasonable terms or at all and, even if successful, those alternative actions may not allow us to meet our scheduled debt service obligations. The Senior Credit Facilities and the indentures that ~~govern~~governs the ~~6.375% Senior Notes and the 5.875%~~ Senior Notes restrict our ability to dispose of assets and use the proceeds from those dispositions, and also restrict our ability to raise debt or certain types of equity to be used to repay other indebtedness when it becomes due. We may not be able to consummate those dispositions or to obtain proceeds in an amount sufficient to meet any debt service obligations then due. Additionally, there can also be no assurance that we will not face credit rating downgrades as a result of weaker than anticipated performance of our businesses, fluctuations in our leverage or cost of capital or other factors. Future downgrades could further adversely affect our cost of funds and related margins, liquidity, competitive position and access to capital markets, and a significant downgrade could have an adverse commercial impact on our business.

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In addition, we conduct a substantial portion of our operations through our subsidiaries, certain of which are not guarantors of the ~~6.375% Senior Notes, the 5.875%~~ Senior Notes or our other indebtedness. Accordingly, repayment of our indebtedness, including the ~~6.375% Senior Notes and the 5.875%~~ Senior Notes, is dependent on the generation of cash flow by our subsidiaries and their ability to make such cash available to us, by dividend, debt repayment or otherwise. Unless they are guarantors of the ~~6.375% Senior Notes, the 5.875%~~ Senior Notes or our other indebtedness, our subsidiaries do not have any obligation to pay amounts due on the ~~6.375% Senior Notes, the 5.875%~~ Senior Notes or our other indebtedness or to make funds available for that purpose. Our subsidiaries may not be able to, or may not be permitted to, make distributions to enable us to make payments in respect of our indebtedness, including the ~~6.375% Senior Notes and the 5.875%~~ Senior Notes. Each subsidiary is a distinct legal entity, and, under certain circumstances, legal and contractual restrictions may limit our ability to obtain cash from our subsidiaries. While the Senior Credit Facilities and the ~~indentures~~indenture that ~~govern~~governs the ~~6.375% Senior Notes and the 5.875%~~ Senior Notes limit the ability of our subsidiaries to incur consensual restrictions on their ability to pay dividends or make other intercompany paymentsto us, these limitations are subject to qualifications and exceptions. In the event that we do not receive distributions from our subsidiaries, we may be unable to make required principal and interest payments on our indebtedness.

Our inability to generate sufficient cash flows to satisfy our debt obligations, or to refinance our indebtedness on commercially reasonable terms or at all, would materially and adversely affect our financial position and results of operations
~~and our ability to satisfy our obligations under our notes.~~

If we cannot make scheduled payments on our debt, we will be in default and holders of the 6.375% Senior Notes and/or the 5.875% Senior Notes could declare all outstanding principal and interest under such notes to be due and payable, the lenders under the Senior Credit Facilities could terminate their commitments to loan money, the lenders under our secured debt could foreclose against the assets securing their borrowings and we could be forced into bankruptcy or liquidation.

Despite our current level of indebtedness, we and our subsidiaries may still be able to incur substantially more debt. This could further exacerbate the risks to our financial condition described above.

We and our subsidiaries may be able to incur significant additional indebtedness in the future. The ~~recent~~ COVID-19 global pandemic may add to our indebtedness. Although the Senior Credit Facilities and the ~~indentures~~indenture that ~~govern~~governs the ~~6.375% Senior Notes and the 5.875%~~ Senior Notes contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and the additional indebtedness incurred in compliance with these restrictions could be substantial. These restrictions also will not prevent us from incurring obligations that do not constitute indebtednessunder the ~~indentures~~indenture governing the ~~notes,~~Senior Notes, such as certain qualified receivables financings. If new debt is added to our current debt levels, the related risks that we and our guarantors now face could intensify.

The terms of the Senior Credit Facilities and the ~~indentures~~indenture that ~~govern~~governs the ~~6.375% Senior Notes and the 5.875%~~ Senior Notes restrict our current and future operations, particularly our ability to respond to changes or to take certain actions.

The Senior Credit Facilities and the ~~indentures~~indenture that ~~govern~~governs the ~~6.375% Senior Notes and the 5.875%~~ Senior Notes contain a number of restrictive covenants that impose significant operating and financial restrictions on us and limit our ability to engage in acts that may be in our long-term best interest, including restrictions on our ability to:

incur, assume or guarantee additional indebtedness;

issue certain disqualified stock;

pay dividends or distributions or redeem or repurchase capital stock;

prepay, redeem or repurchase debt that is junior in right of payment to the ~~notes;~~

debt under the Senior Credit Facilities and Notes; make loans or investments;

incur liens;

restrict dividends, loans or asset transfers from our restricted subsidiaries;

sell or otherwise dispose of assets, including capital stock of subsidiaries and sale/leaseback transactions;

enter into transactions with affiliates; and

enter into new lines of business.

The ~~indentures that govern the 6.375%~~ Senior ~~Notes~~Credit Facilities and the ~~5.875%~~indenture that governs the Senior Notes also limit the ability of Lions Gate and our guarantors to consolidate or merge with or into, or sell substantially all of our assets to, another person.

In addition, the restrictive covenants in the Senior Credit Facilities require us to maintain specified financial ratios, tested quarterly. Our ability to meet those financial ratios and tests can be affected by events beyond our control, including the effects on our business from the ~~ongoing~~ COVID-19 global pandemic and related government actions and consumer behavior; as such, we may be unable to meet such financial ratios and tests.

A breach of the covenants or restrictions under the Senior Credit Facilities or the ~~indentures~~indenture that ~~govern~~governs the ~~6.375%~~ Senior Notes, ~~and the 5.875% Senior Notes~~or nonpayment of any principal or interest due thereunder, could result in an event of default under the applicable indebtedness. Such a default may allow the creditors to accelerate the related debt and may result in the acceleration of any other debt to which a cross-acceleration or cross-default provision applies. In addition, an event of default under the Senior Credit Facilities would permit the lenders under our revolving facility to terminate all commitments to extend further credit pursuant to the revolving facility thereunder. Furthermore, if we were unable to repay the amounts due and payable under the Senior Credit Facilities, the lenders thereof could proceed against the collateral granted to them to secure the Senior Credit Facilities. In the event our lenders or noteholders accelerate the repayment of our borrowings, we and our subsidiaries may not have sufficient assets to repay that indebtedness.

As a result of these restrictions, we may be:

limited in how we conduct our business;

unable to raise additional debt or equity financing to operate during general economic or business downturns; or

unable to compete effectively or to take advantage of new business opportunities.

These restrictions may affect our ability to grow in accordance with our strategy. In addition, our financial results, our substantial indebtedness and our credit ratings could adversely affect the availability and terms of our financing.

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Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.

Borrowings under the Senior Credit Facilities and advances under the Production Tax Credit Facility are at variable rates of interest and expose us to interest rate risk, including in connection with the ~~ongoing~~ COVID-19 global pandemic and its effects, which could increase the cost of capital. If interest rates were to increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.

An increase in the ownership of our Class A voting common shares by certain shareholders could trigger a change in control under the agreements governing our indebtedness.

The agreements governing certain of our long-term indebtedness contain change in control provisions that are triggered when any of our shareholders, directly or indirectly, acquires ownership or control of in excess of a certain percentage of the total voting power of our Class A voting common shares, no par value per share (the "Class A voting shares").

Upon the occurrence of certain change of control events, an event of default may occur under our Senior Credit Facilities and the holders of the ~~6.375% Senior Notes and the 5.875%~~ Senior Notes may require us to repurchase all or a portion of such notes. Dr. Mark H. Rachesky, M.D. and his affiliates, who collectively currently hold over 23% of our voting stock and 11% of our non-voting common stock are “Permitted Holders” for purposes of the ~~indentures that govern the 6.375%~~ Senior ~~Notes~~Credit Facilities and the ~~5.875%~~indenture that governs the Senior Notes. Accordingly, certain increases of ownership or other transactions involving Dr. Rachesky and his affiliates would not constitute a change of control under the ~~indentures~~Senior Credit Facilities or the indenture that ~~govern~~governs the ~~6.375% Notes and the 5.875%~~ Senior Notes, ~~(in which case holders of the 6.375% Notes and the 5.875% Senior Notes would not have a right to have their respective notes, as applicable, repurchased),~~ but could constitute a change of control under the other existing or future indebtedness of us and our subsidiaries.

We may not be able to repurchase outstanding debt upon a qualifying change of control for such debt because we may not have sufficient funds. Further, we may be contractually restricted under the terms of the Senior Credit Facilities from repurchasing all of the 6.375% Senior Notes and the 5.875% Senior Notes tendered by holders upon a change in control. Our failure to repurchase the 6.375% Senior Notes and the 5.875% Senior Notes upon a change in control would cause a default under the indentures that governs such notes and a cross-default under the Senior Credit Facilities.

The Senior Credit Facilities will also provide that certain change of control events will result in an event of default that permits lenders to accelerate the maturity of borrowings thereunder and, in the case of the Senior Credit Facilities, to enforce security interests in the collateral securing such debt, thereby limiting our ability to raise cash to purchase outstanding 6.375% Senior Notes and 5.875% Senior Notes, and reducing the practical benefit of the offer-to-purchase provisions to the holders of the 6.375% Senior Notes and the 5.875% Senior Notes. Any of our future debt agreements may contain similar provisions.

Risk Related to Tax Rules and Regulations

The Internal Revenue Service may not agree that we should be treated as a non-U.S. corporation for U.S. federal tax purposes and may not agree that our U.S. affiliates should not be subject to certain adverse U.S. federal income tax rules.

Under current U.S. federal tax law, a corporation is generally considered for U.S. federal tax purposes to be a tax resident in the jurisdiction of its organization or incorporation. Because we are incorporated in Canada, we would generally be classified as a non-U.S. corporation (and, therefore, a non-U.S. tax resident) under these rules. However, Section 7874 of the Internal Revenue Code (the “Code”) (“Section 7874”) provides an exception to this general rule under which a non-U.S. incorporated entity may, in certain circumstances, be treated as a U.S. corporation for U.S. federal tax purposes.

Under Section 7874, if (a) the ~~Starz~~STARZ stockholders held (within the meaning of Section 7874) 80% or more (by vote or value) of our post-reclassification shares after the ~~Starz~~STARZ merger by reason of holding ~~Starz~~STARZ common stock (the “80% ownership test,” and such ownership percentage the “Section 7874 ownership percentage”), and (b) our “expanded affiliated group” did not have “substantial business activities” in Canada when compared to the total business activities of such expanded affiliated group (the “substantial business activities test”), we will be treated as a U.S. corporation for U.S. federal tax purposes. If the Section 7874

ownership percentage of the ~~Starz~~STARZ stockholders in Lions Gate after the merger was less than 80% but at least 60% (the “60% ownership test”), and the substantial business activities test was not met, ~~Starz~~STARZ and its U.S. affiliates (including the U.S. affiliates historically owned by us) may, in some circumstances, be subject to certain adverse U.S. federal income tax rules (which, among other things, could limit our ability to utilize certain U.S. tax attributes to offset U.S. taxable income, such as the use of net operating losses and certain tax credits, or to offset the gain resulting from certain ~~transactions)~~transactions, such as from the transfer or license of property to a foreign related person during the 10-year period following the merger).

Based on the terms of the merger, the rules for determining share ownership under Section 7874 and certain factual assumptions, ~~Starz~~STARZ stockholders are believed to have held (within the meaning of Section 7874) less than 60% (by both vote and value) of our ~~post- reclassification~~post-reclassification shares after the merger by reason of holding shares of ~~Starz~~STARZ common stock. Therefore, under current law, it is expected that we should not be treated as a U.S. corporation for U.S. federal tax purposes and that Section 7874 should otherwise not apply to us or our affiliates as a result of the merger.

However, ~~due to the issuance by the Internal Revenue Service (the “IRS”) of a series of notices and proposed, temporary, and final regulations, many of~~since the rules ~~under Section 7874~~ are relatively new, and complex. In particular, stock ownership for purposes of computing the Section 7874 ownership percentage is subject to various adjustments under the Code and the Treasury regulations promulgated thereunder. Some of the relevant determinations must be made based on facts as they existed at the time of closing of the merger and the specific set of rules that were in effect on that date, making the determination of the Section 7874 ownership percentage complex and subject to factual and legal uncertainties. Thus, there can be no assurance that the IRS will agree with the position that we should not be treated as a U.S. corporation for U.S. federal tax purposes or that Section 7874 does not otherwise apply as a result of the merger.

In particular, on April 4, 2016, the IRS issued temporary and proposed Treasury regulations under Section 7874 (the “2016 Section 7874 Regulations”), which, among other things, require certain adjustments that generally increase, for purposes of the Section 7874 ownership tests, the percentage of the stock of a foreign acquiring corporation deemed owned (within the meaning of Section 7874) by the former shareholders of an acquired U.S. corporation by reason of holding stock in such U.S. corporation. On January 13, 2017, the IRS published regulations which finalized with some modifications certain portions of the 2016 Section 7874 Regulations and which included new temporary and proposed regulations. Further, on July 11, 2018, the IRS published final regulations (along with the final regulations published on January 13, 2017, the “Final Regulations”) adopting with some modifications the remaining 2016 Section 7874 Regulations.

For example, the Final Regulations disregard, for purposes of determining the Section 7874 ownership percentage, (a) any “non-ordinary course distributions” (within the meaning of the temporary regulations) made by the acquired U.S. corporation (such as Starz) during the 36 months preceding the acquisition, including certain dividends and share repurchases, (b) potentially any cash consideration received by the shareholders of such U.S. corporation in the acquisition to the extent such cash is, directly or indirectly, provided by the U.S. corporation, (c) certain stock of the foreign acquiring corporation that was issued as consideration in a prior acquisition of another U.S. corporation (or U.S. partnership) during the 36 months preceding the signing date of a binding contract for the acquisition being tested, as well as (d) adopted rules addressing certain post-inversion tax avoidance transactions. Taking into account the effect of the Final Regulations, it is currently believed that the Section 7874 ownership percentage of the Starz stockholders in Lions Gate after the merger is less than 60%. However, the Final Regulations are new and complex, there is limited guidance regarding ~~their~~the application ~~and some~~of Section 7874, including the application of the ~~relevant determinations must be made based on~~ownership test and the application of the rules to the facts as they existed at the time of the closing of the acquisition. Accordingly, there can be no assurance that the Section 7874 ownership percentage of the Starz stockholders after the merger will be less than 60% as determined under the 2016 Section 7874 Regulations or the Final Regulations, as applicable,, or that the IRS will not otherwise successfully assert that either the 80% ownership test or the 60% ownership test were met after the merger.

If ~~the 80% ownership test has been met after the merger and~~ we were ~~accordingly~~to be treated as a U.S. corporation for ~~U.S.~~ federal tax purposes, ~~under Section 7874,~~ we ~~would~~could be subject to ~~substantial additional~~substantially greater U.S. tax ~~liability.~~liability than currently contemplated as a non-U.S. corporation. In addition, non-U.S. shareholders of Lions Gate would be subject to U.S. withholding tax on the gross amount of any dividends paid by us to such shareholders (subject to an exemption or reduced rate available under an applicable tax treaty). ~~Regardless~~

Table of any application of Section 7874, we are expected to be treated as a Canadian tax resident for Canadian tax purposes. Consequently, if we were to be treated as a U.S. corporation for U.S. federal tax purposes under Section 7874, we could be liable for both U.S. and Canadian taxes, which could have a material adverse effect on our financial condition and results of operations.Contents

If the 60% ownership test has been met, several adverse U.S. federal income tax rules could apply to our U.S. affiliates (including Starz and its U.S. affiliates). In particular, in such case, Section 7874 could limit the ability of such U.S. affiliates to utilize certain U.S. tax attributes (including net operating losses and certain tax credits) to offset any taxable income or gain resulting from certain transactions, including any transfers or licenses of property to a foreign related person during the 10-year period following the merger. The 2016 Section 7874 Regulations and the Final Regulations generally expand the scope of these rules. In addition, the 2016 Section 7874 Regulations and Final Regulations include rules that would apply if the 60% ownership test has been met,

which, in such situation, may limit our ability to restructure or access cash earned by certain of its non-U.S. subsidiaries, in each case, without incurring substantial U.S. tax liabilities. Moreover, in such case, Section 4985 of the Code and rules related thereto would impose an excise tax on the value of certain stock compensation held directly or indirectly by certain “disqualified individuals” at a rate currently equal to 15%.

Recent and proposed changes to the tax laws could result in Lions Gate being treated as a U.S. corporation for U.S. federal tax purposes or in ~~Starz~~STARZ and its U.S. affiliates (including the U.S. affiliates historically owned by us) being subject to certain adverse U.S. federal income tax rules on financing and other activities.

As discussed above, under current law, we are expected to be treated as a non-U.S. corporation for U.S. federal tax purposes and Section 7874 is not otherwise expected to apply as a result of the merger. However, changes to Section 7874 orand the U.S. Treasury regulations promulgated thereunder, as well as the treatment of expatriated companies under Section 7874 for income treaty purposes, could affect our status as a non-U.S. corporation for U.S. federal tax purposes or could result in the application of certain adverse U.S. federal income tax rules to ~~Starz~~STARZ and its U.S. affiliates (including the U.S. affiliates historically owned by us). Any such changes could have prospective or retroactive application. If we were to be treated as a U.S. corporation for federal tax purposes or if ~~Starz~~STARZ and its U.S. affiliates (including the U.S. affiliates historically owned by us) were to become subject to such adverse U.S. federal income tax rules, we and our U.S. affiliates could be subject to substantially greater U.S. tax liability than currently contemplated.

Recent legislative proposals ~~have~~under President Joe Biden’s “Made in America Tax Plan” are aimed to expand the scope of U.S. corporate tax residence ~~including in such a way as would cause us~~ to ~~be treated~~address certain perceived issues arising from so-called inversion transactions, by reducing the ownership threshold (discussed above) to 50% from 80% and by treating the foreign acquiring company as a U.S. corporation if ~~the management and control of Lions Gate were~~it is determined to be ~~located primarily~~managed and controlled in the U.S. ~~In addition, recent legislative rules have aimed to expand the scope of Section 7874, or otherwise address certain perceived issues arising in connection with so-called inversion transactions.~~ Such ~~rules,~~proposals, if enacted and applicable on or prior to the date of the closing of the merger, could cause us to be treated as a U.S. corporation for U.S. federal tax purposes or cause our affiliates to be subject to adverse U.S. tax rules, in which case, we would be subject to substantially greater U.S. tax liability than currently contemplated.

Recent legislative changes enacted as part of the Tax Cuts and Jobs Act (discussed in more detail below), including the limitations on deduction of interest expense and the adoption of the base erosion and anti-abuse tax, contain provisions intended to broaden the tax base and could affect our financing arrangements. Further, additional legislative and other proposals (including the final

Treasury regulations under Section 385 of the Code issued by the IRS on October 13, 2016 (the “Final Section 385 Regulations”), if permitted to go into full effect, could cause us and our affiliates to be subject to certain intercompany financing limitations, including with respect to their ability to deduct certain interest expense. These recent and proposed legislative changes could cause us and our affiliates to recognize additional taxable income and could have a significant adverse effect on us and our affiliates.

It is presently uncertain whether any such proposals or other legislative action relating to the scope of U.S. tax residence, Section 7874 or so-called inversion transactions and inverted groups will be enacted into law and/or how new laws will be interpreted or applied.

Future changes to U.S. and non-U.S. tax laws could adversely affect us.

The U.S. Congress, the Organisation for Economic Co-operation and Development (“OECD”) and other government agencies in jurisdictions where we and our affiliates will conduct business have had an extended focus on issues related to the taxation of multinational corporations. For the past several years, the primary focus has been in the area of “base erosion and profit shifting,” including situations where payments are made between affiliates from a jurisdiction with high tax rates to a jurisdiction with lower tax rates. As part of its so-called Base Erosion and Profit Shifting (“BEPS”) project, OECD and the G-20 developed changes to numerous long-standing international tax principles. More recently, countries are increasingly seeking ways to tax what is sometimes referred to as the digitalized economy.

Tax laws are dynamic and subject to change as new laws are passed and new interpretations of the law are issued or applied. As discussed in more detail below, the U.S. recently enacted significant tax reform, and certain provisions of the new law may adversely affect us. Further, President Biden has proposed changes to the U.S. tax rules under the Made in America Tax Plan which would, among other things, raise the U.S. corporate tax rate to 28%, deny U.S. tax deductions to companies that make payments to affiliates in low-tax jurisdictions, and strengthen the anti-inversion rules (discussed above). In addition, governmental tax authorities are increasingly scrutinizing the tax positions of companies. Many countries in the European Union, as well as a number of other countries and organizations such as OECD, are actively considering changes to existing tax laws that, if enacted, could increase our tax obligations in countries where we do business. For example, the U.K. has announced plans to increase its corporate tax rate from 19% to 25%, starting in April 2023. If U.S. or other foreign tax authorities change applicable tax laws, our overall taxes could increase, and our business, financial condition or results of operations may be adversely impacted

Changes in foreign, state and local tax incentives may increase the cost of original programming content to such an extent that they are no longer feasible.

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Original programming requires substantial financial commitment, which can occasionally be offset by foreign, state or local tax incentives. However, there is a risk that the tax incentives will not remain available for the duration of a series. If tax incentives are no longer available or reduced substantially, it may result in increased costs for us to complete the production, or make the production of additional seasons more expensive. If we are unable to produce original programming content on a cost effective basis our business, financial condition and results of operations would be materially adversely affected.

~~Changes to Tax Treaties could adversely affect us.~~

Over ninety jurisdictions have signed, or committed to sign, the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting. The Multilateral Convention modifies tax treaties signed by Canada and many jurisdictions where we or our affiliates may operate. Although the United States is not a signatory to the Multilateral Convention, the U.S. Treasury has revised the U.S. model income tax convention (the “model”), which is the baseline text used by the U.S. Treasury to negotiate tax treaties. The revisions made to the model address certain aspects of the model by modifying existing provisions and introducing entirely new provisions. Specifically, the new provisions target (a) permanent establishments subject to little or no foreign tax, (b) special tax regimes, (c) expatriated entities subject to Section 7874, (d) the anti-treaty shopping measures of the limitation on benefits article and (e) subsequent changes in treaty partners’ tax laws.

With respect to new model provisions pertaining to expatriated entities, because it is expected that the Starz merger will not result in the creation of an expatriated entity as defined in Section 7874, payments of interest, dividends, royalties and certain other items of income by or to Starz and/or its U.S. affiliates to or from non-U.S. persons would not be expected to be subject to such provisions (which, if applicable, could cause such payments to become subject to full withholding tax), even if applicable treaties were subsequently amended to adopt the new model provisions. However, as discussed above, the rules under Section 7874 are relatively new, complex and are the subject of current and future legislative and regulatory changes. In addition, because each tax treaty is a result of negotiation, the language used in a particular treaty often departs from the model. Accordingly, even if we are not impacted by the language of the current model, there can be no assurance that we will not be affected by the language agreed to in a particular treaty.

Our tax rate is uncertain and may vary from expectations.

There is no assurance that we will be able to maintain any particular worldwide effective corporate tax rate because of uncertainty regarding the tax policies jurisdictions in which we and our affiliates operate. Our actual effective tax rate may vary from our expectations, and such variance may be material. Additionally, tax laws or their implementation and applicable tax authority practices in any particular jurisdiction could change in the future, possibly on a retroactive basis, and any such change could have an adverse impact on us and our affiliates.

Legislative or other governmental action in the U.S. could adversely affect our business.

Legislative action may be taken by the U.S. Congress that, if ultimately enacted, could limit the availability of tax benefits or deductions that we currently claim, override tax treaties upon which we rely, or otherwise increase the taxes that the U.S. imposes on our worldwide operations. Such changes could materially adversely affect our effective tax rate and/or require us to take further action, at potentially significant expense, to seek to preserve our effective tax rate. In addition, if proposals were enacted that had the effect of limiting our ability as a Canadian company to take advantage of tax treaties with the U.S., we could incur additional tax expense and/or otherwise incur business detriment.

Changes in, or interpretations of, tax rules and regulations, and changes in geographic operating results, may adversely affect our effective tax rates.

We are subject to income taxes in Canada, the U.S. and foreign tax jurisdictions. We also conduct business and financing activities between our entities in various jurisdictions and we are subject to complex transfer pricing regulations in the countries in which we operate. Although uniform transfer pricing standards are emerging in many of the countries in which we operate, there is still a relatively high degree of uncertainty and inherent subjectivity in complying with these rules. In addition, due to economic and political conditions, tax rates in various jurisdictions may be subject to significant change. Our future effective tax rates could be affected by changes in tax laws or regulations or the interpretation thereof (including those affecting the allocation of profits and expenses to differing jurisdictions), by changes in the amount of revenue or earnings that we derive from international sources in countries with high or low statutory tax rates, by changes in the valuation of our deferred tax assets and liabilities, by changes in the expected timing and amount of the release of any tax valuation allowance, or by the tax effects of stock-based compensation. Unanticipated changes in our effective tax rates could affect our future results of operations.

Further, we may be subject to examination of our income tax returns by federal, state, and foreign tax jurisdictions. We regularly assess the likelihood of outcomes resulting from possible examinations to determine the adequacy of our provision for income taxes. In making such assessments, we exercise judgment in estimating our provision for income taxes. While we believe our estimates are reasonable, we cannot assure you that final determinations from any examinations will not be materially different from those reflected in our historical income tax provisions and accruals. Any adverse outcome from any examinations may have an adverse effect on our business and operating results, which could cause the market price of our securities to decline.

Based on our current assessment, we believe that substantially all of our deferred tax assets will be realized. There is no assurance that we will attain our future expected levels of taxable income or that a valuation allowance against new or existing deferred tax assets will not be necessary in the future.

~~Guidance, regulations, or technical corrections issued in connection with the Tax Cuts and Jobs Act could adversely impact our effective tax rate and profile.~~

On December 22, 2017, the Tax Cuts and Jobs Act (the "Tax Act") was signed into law, making significant changes to the taxation of U.S. business entities. The changes included in the Tax Act are broad and complex. Among other things, the Tax Act contains significant changes to U.S. federal corporate taxation, including reduction of the corporate tax rate from a top marginal rate of 35% to a flat rate of 21%, limitation of the tax deduction for interest expense to 30% of adjusted earnings (except for certain small businesses), a new base erosion anti-abuse tax, limitation of the deduction for net operating losses to 80% of current year taxable income and elimination of net operating loss carrybacks, one time taxation of offshore earnings at reduced rates regardless of whether they are repatriated, elimination of U.S. tax on foreign earnings (subject to certain important exceptions), immediate deductions for certain new investments instead of deductions for depreciation expense over time, and modifying or repealing many business deductions and credits. Notwithstanding the reduction in the corporate income tax rate, the overall impact of the Tax Act on us is uncertain and our business and financial condition could be adversely affected. The impact of the Tax Act on holders of our stock could also be adverse. Further, the Tax Act may reduce the appeal of a foreign corporation acquiring a U.S. corporation if the 60% or greater ownership test (discussed above) is met post-merger, as it can now result in a recapture by the U.S. corporation of its one time taxation of offshore earnings at a full 35% rate without foreign tax credits (as opposed to a 15.5% or lower rate

~~with such credits), an increased base erosion anti-abuse tax liability, and the taxation of shareholders on distributions at ordinary income (as opposed to qualified dividend) rates.~~

The impacts of the Tax Act may differ from the estimates provided elsewhere in this report, possibly materially, due to, among other things, changes in interpretations of the Tax Act, any legislative action to address questions that arise because of the Tax Act, any changes in accounting standards for income taxes or related interpretations in response to the Tax Act, or any updates or changes to estimates we have utilized to calculate the impacts, including impacts from changes to current year earnings estimates. Given the unpredictability of possible changes and their potential interdependency, it is very difficult to assess whether the overall effect of such potential tax changes would be cumulatively positive or negative for our earnings and cash flow, but such changes could adversely impact our financial results. In addition, it is uncertain if and to what extent various states will conform to the newly enacted federal tax law. We urge our shareholders to consult with their legal and tax advisors with respect to this legislation and the potential tax consequences of investing in or holding our stock.

Economic conditions and regulatory changes leading up to and following the United Kingdom’s likely exit from the European Union could have a material adverse effect on our business and results of operations.

On January 31, 2020, the UK formally withdrew from the European Union, and the U.K. government has commenced the legal process of leaving the European Union, typically referred to as Brexit. While the full effects of Brexit will not be known for some time, Brexit could cause disruptions to, and create uncertainty surrounding, our business and results of operations. The most immediate effect has been significant volatility in global equity and debt markets and currency exchange rate fluctuations. Ongoing global market volatility and a deterioration in economic conditions due to uncertainty surrounding Brexit could disrupt the markets in which we operate and lead our customers to closely monitor their costs and delay financial spending decisions.

The effects of Brexit will depend on any agreements the U.K. makes to retain access to E.U. markets, either during a transitional period or more permanently. The measures could potentially disrupt the markets we serve and may cause us to lose customers and employees. In addition, Brexit could lead to legal uncertainty and potentially divergent national laws and regulations as the U.K. determines which E.U. laws to replace or replicate. Any of these effects of Brexit could materially adversely affect our business, results of operations and financial condition.

Changes in the method of determining the London Interbank Offered Rate (LIBOR), or the replacement of LIBOR with an alternative reference rate, may adversely affect interest rates, our business, and financial markets as a whole.

On July 27, 2017, the Financial Conduct Authority in the U.K. announced that it would phase out LIBOR as a benchmark by the end of 2021. It is unclear whether new methods of calculating LIBOR will be established such that it continues to exist after 2021, or whether different benchmark rates used to price indebtedness will develop. ~~Under the terms of~~ ~~the credit and guarantee agreement dated December 8, 2016, as amended (the "Amended Credit Agreement")~~, in the event of the discontinuance of the LIBOR Rate, a mutually agreed-upon alternate benchmark rate will be established to replace the LIBOR Rate. The Company and Lenders (as defined in the Amended Credit Agreement) shall, in good faith, endeavor to establish an alternate benchmark rate that gives due ~~consideration~~ to prevailing market convention for determining a rate of interest for syndicated loans in the United States at such time, and which places the Lenders and the Company in the same economic position that existed immediately prior to the discontinuation of the LIBOR Rate. The Company does not anticipate that the discontinuance or modification of the LIBOR Rate will materially impact its liquidity or financial position. There is presently substantial uncertainty relating to the process and timeline for developing LIBOR alternatives, how widely any given alternative will be adopted by parties in the financial markets, and the extent to which alternative benchmarks may be subject to volatility or present risks and challenges that LIBOR does not. It is possible that we will disagree with our contractual counterparties over which alternative benchmark to adopt, which could make renewing or replacing our debt facilities and other agreements more complex. Consequently, it is difficult to predict what effect, if any, the phase-out of LIBOR and the use of alternative benchmarks may have on our business or on the overall financial markets. If LIBOR alternatives re-allocate risk among parties in a way that is disadvantageous to market participants, if there is disagreement among market participants, over which alternative benchmark to adopt, or if uncertainty relating to the LIBOR phase-out disrupts financial markets, it could have a material adverse effect on our financial position, results of operations, and liquidity.

~~Global legislative and governmental responses to COVID-19 could affect our business.~~

On March 18, 2020 and March 27, 2020, new United States Congressional legislations, the “Families First Coronavirus Response Act” (FFCRA) and the “Coronavirus Aid, Relief, and Economic Security Act” (CARES Act), respectively (collectively, the COVID-19 Acts) were signed into law. The COVID-19 Acts include several significant business tax provisions that, among other things, eliminate the taxable income limit for certain net operating losses (“NOL”s) and allow businesses to carry back NOLs

arising in tax years beginning in 2018, 2019, and 2020 to the five prior tax years, permit businesses to carry back NOLs generated in fiscal tax year 2018 to the two prior tax years pursuant to a technical amendment of Section 172 of the Code, relax the business interest expense limitation under Section 163(j) of the Code from 30 percent to 50 percent of adjusted taxable income, accelerate refunds of previously generated corporate alternative minimum tax credits, and provide payroll tax relief to employers by allowing the deferral of payment of a certain portion of the employer’s share of Social Security tax over the next two years and granting a refundable payroll tax credit to eligible employers whose business operations have been disrupted by COVID-19. In addition, other countries around the world, where we operate, have enacted legislation to provide tax relief to businesses dealing with the COVID-19 crisis. The U.S. Treasury and foreign tax authorities continue to issue guidance on the application of these recently enacted legislations, and accordingly, our analysis of the impact of these provisions on us is not final. We are continuing to assess the effects of these provisions to our fiscal 2020 and 2021 effective income tax rates and our profile.

~~Any potential government crisis relief assistance in response to COVID-19 could impose limitations on our corporate activities, may dilute our stockholders and may not be on terms favorable to us.~~

Numerous government-sponsored crisis relief programs have been implemented and others are being considered in response to the COVID-19 outbreak. If any government agrees to provide crisis relief assistance that we accept, it may impose certain requirements on the recipients of the aid including restrictions on executive officer compensation, share buybacks, dividends, prepayment of debt, limitations on debt, and other similar restrictions that will apply for a period of time after the aid is repaid or redeemed in full. We cannot assure you that any such government crisis relief assistance will not limit our corporate activities or be on terms that are favorable to us. Such restrictions and terms could adversely impact our business and operations.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

Not applicable.

ITEM 2. PROPERTIES.

Our corporate office is located at 250 Howe Street, 20th Floor, Vancouver, BC V6C 3R8. Our principal executive offices are located at 2700 Colorado Avenue, Santa Monica, California, 90404, where we occupy 192,584 square feet (per a lease that expires in August 2023).

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In addition, we lease the following properties used by our Motion Picture, Television Production and Media Networks segments:

•280,000 square feet at 8900 Liberty Circle, Englewood, Colorado (per a lease that expires in December 2023);

•93,670 square feet at 12020 Chandler Blvd., Valley Village, California (per a lease that expires in December 2027);

•60,116 square feet at 1647 Stewart Street, Santa Monica, California (per a lease that expires in December 2028);

•34,332 square feet at 530 Fifth Avenue, New York, New York (per a lease that expires in August 2028);

•25,346 square feet at 9460 Wilshire Blvd., Beverly Hills, California (per a lease that expires in December 2022);

•11,243 square feet at 45 Mortimer Street, London, United Kingdom (per a lease that expires in July 2029);

•7,500 square feet at Unit 502, Crest Audeus, Fun Republic Lane, Andheri West, Mumbai, India (per a lease that expires in August 2024);

•2,700 square feet at 27 West 24th Street, New York, New York (per a lease that expires in May 2023);

•1,968 square feet at 1235 Bay Street, Toronto, Ontario (per a lease that expires in December ~~2020)~~2022);

•1,645 square feet at A6 Gonti Road, Beijing, China (per a lease that expires in December ~~2020)~~2022); and

•975 square feet at 3 Boulevard Royal, Luxembourg City, Luxembourg (per a lease that expires in May ~~2021)~~2024); and

~~620 square feet at Millennium City 5, 418 Kwun Tong Road, Kwun Tong, Hong Kong (per a lease that expires in October 2020).~~

We believe that our current facilities are adequate to conduct our business operations for the foreseeable future. We believe that we will be able to renew these leases on similar terms upon expiration. If we cannot renew, we believe that we could find other suitable premises without any material adverse impact on our operations.

ITEM 3. LEGAL PROCEEDINGS.

From time to time, the Company is involved in certain claims and legal proceedings arising in the normal course of business. While the resolution of these matters cannot be predicted with certainty, we do not believe, based on current knowledge, that the outcome of any currently pending legal proceedings in which the Company is currently involved will have a material adverse effect on the Company's consolidated financial position, results of operations or cash flow.

For a discussion of certain claims and legal proceedings, see Note 18- Commitments and Contingencies to our consolidated financial statements, which discussion is incorporated by reference into this Part I, Item 3, Legal Proceedings.

ITEM 4. MINE SAFETY DISCLOSURES.

Not Applicable.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market Information

~~Our~~We have two (2) classes of common shares ~~were previously~~listed on the NYSE. Our Class A voting shares, no par value per share (the "Class A non-voting shares"), are listed on the NYSE under the ~~symbols “LGF.” Effective December 9, 2016, each then existing Lionsgate common share was converted into 0.5 shares of a newly issued class of Class A voting shares~~symbol “LGF.A” and ~~0.5 shares of a newly issued class of Lionsgate~~our Class B non-voting shares, no par value per share (the "Class B non-voting ~~shares"~~shares”)~~. Our Class A voting shares are listed on the NYSE under the symbol “LGF.A”. Our Class B non-voting shares~~, are listed on the NYSE under the symbol “LGF.B”.

Holders

As of May ~~18, 2020,~~24, 2021, there were approximately ~~525~~526 and ~~713~~707 shareholders of record of our Class A voting shares and Class B non-voting shares, respectively.

Dividends

The amount of any future dividends, if any, that we pay to our shareholders is determined by our Board of Directors, at its discretion, and is dependent on a number of factors, including our financial position, results of operations, cash flows, capital requirements and restrictions under our credit agreements, and shall be in compliance with applicable law. We cannot guarantee the amount of dividends paid in the future, if any.

Securities Authorized for Issuance Under Equity Compensation Plans

The information required by this item is incorporated by reference to our Proxy Statement for our ~~2020~~2021 Annual General Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year ended March 31, ~~2020.~~2021.

Taxation

The following is a general summary of certain Canadian federal income tax consequences to U.S. Holders (who, at all relevant times, deal at arm's length with the Company) with respect to the purchase, ownership and disposition of common shares. For the purposes of this Canadian income tax discussion, a “U.S. Holder” means a holder of common shares who (1) for the purposes of the Income Tax Act (Canada) (the "ITA") is not, has not, and will not be, or deemed to be, resident in Canada at any time while such holder holds common shares, (2) at all relevant times is a resident of the United States under the Canada-United States Tax Convention (1980) (the “Convention”) and is eligible for benefits under the Convention, (3) is not a “foreign affiliate” as defined in the ITA of a person resident in Canada, and (4) does not and will not use or be deemed to use the common shares in carrying on a business in Canada. This summary does not apply to a U.S. Holder that is an insurer or an “authorized foreign bank” within the meaning of the ITA. Such U.S. Holders should seek tax advice from their advisors.

This summary is not intended to be, and should not be construed to be, legal or tax advice and no representation with respect to the tax consequences to any particular investor is made. The summary does not address any aspect of any provincial, state or local tax laws or the tax laws of any jurisdiction other than Canada or the tax considerations applicable to non-U.S. Holders. Accordingly, prospective investors should consult with their own tax advisors for advice with respect to the income tax consequences to them having regard to their own particular circumstances, including any consequences of an investment in common shares arising under any provincial, state or local tax laws or the tax laws of any jurisdiction other than Canada.

This summary is based upon the current provisions of the ITA, the regulations thereunder and the proposed amendments thereto publicly announced by the Department of Finance, Canada before the date hereof and our understanding of the current administrative policies and assessing practices of the Canada Revenue Agency published in writing prior to the date hereof. No assurance may be given that any proposed amendment will be enacted in the form proposed, if at all. This summary does not otherwise take into account or anticipate any changes in law, whether by legislative, governmental or judicial action.

The following summary applies only to U.S. Holders who hold their common shares as capital property. In general, common shares will be considered capital property of a holder where the holder is neither a trader nor dealer in securities, does not hold the common shares in the course of carrying on a business and is not engaged in an adventure in the nature of trade in respect thereof. This summary does not apply to a U.S. Holder that is a “financial institution” within the meaning of the mark-to-market rules contained in the ITA or to holders who have entered into a “derivative forward agreement” or a “synthetic disposition arrangement” as these terms are defined in the ITA.

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Amounts in respect of common shares paid or credited or deemed to be paid or credited as, on account or in lieu of payment of, or in satisfaction of, dividends to a shareholder who is not a resident of Canada within the meaning of the ITA will generally be subject to Canadian non-resident withholding tax. Canadian withholding tax applies to dividends that are formally declared and paid by the Company and also to deemed dividends such as those that may be triggered by a cancellation of common shares if the cancellation occurs otherwise than as a result of a simple open market transaction. For either deemed or actual dividends, withholding tax is levied at a ~~basic~~ rate of 25%, which rate may be reduced pursuant to the terms of an applicable tax treaty between Canada and the country of residence of the non-resident shareholder. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the “MLI”), of which Canada is a signatory, affects many of Canada’s bilateral tax treaties (excluding the Convention), including the ability to claim benefits thereunder. Affected Non-Resident Holders should consult their own tax advisors in this regard. Under the Convention, the rate of Canadian non-resident withholding tax on the gross amount of dividends received by a U.S. Holder, which is the beneficial owner of such dividends, is generally 15%. However, where such beneficial owner of the dividends is a company that owns at least 10% of the voting shares of the company paying the dividends, the rate of such withholding is 5%. For these purposes, a company that is a resident of the United States for the purposes of the Convention and which holds an interest in an entity (other than an entity that is resident in Canada) that is fiscally transparent under the laws of the United States will be considered to own the voting shares of the Company owned by that fiscally transparent entity in proportion to the company’s ownership interest in the fiscally transparent entity.

In addition to the Canadian withholding tax on actual or deemed dividends, a U.S. Holder also needs to consider the potential application of Canadian income tax on capital gains. A U.S. Holder will generally not be subject to tax under the ITA in respect of any capital gain arising on aan actual or deemed disposition of common shares (including, generally, on a purchase by the Company on the open market) unless at the time of disposition such shares constitute taxable Canadian property of the holder for purposes of the ITA and such U.S. Holder is not entitled to relief under the Convention. If the common shares are listed on a designated stock exchange (which includes the NYSE) at the time they are disposed of, they will generally not constitute taxable Canadian property of a U.S. Holder unless, at any time during the 60-month period immediately preceding the disposition of the common shares, the U.S. Holder, persons with whom such U.S. Holder does not deal at arm's length, or the U.S. Holder together with such non-arm's length persons, owned 25% or more of the issued shares of any class or series of the capital stock of the Company and at ~~any~~such time, ~~during~~more than 50% of the ~~immediately preceding 60-month period,~~fair market value of the shares was derived ~~their value principally~~ from one or any combination of (i) real or immovable property situated in Canada, (ii) Canadian resource properties, (iii) timber resource properties, and (iv) options in respect of, or interests in, such properties. Assuming that the common shares have never derived their value principally from any of the items listed in (i)-(iv) above, capital gains derived by a U.S. Holder from the disposition of common shares will generally not be subject to tax in Canada.

Issuer Purchases of Equity Securities

On May 31, 2007, our Board of Directors authorized the repurchase of up to $50 million of our common shares. On each of May 29, 2008 and November 6, 2008, our Board of Directors authorized additional repurchases up to an additional $50 million of our common shares. On December 17, 2013, our Board of Directors authorized the Company to increase its stock repurchase plan to $300 million and on February 2, 2016, our Board of Directors authorized the Company to further increase its stock repurchase plan to $468 million. To date, ~~including repurchases subsequent to March 31, 2020 of approximately $1.0 million,~~ approximately $288.1 million (or 16,608,796) of our common shares have been purchased, leaving approximately $179.9 million of authorized potential purchases. The remaining $179.9 million of our common shares may be purchased from time to time at the Company’s discretion, including quantity, timing and price thereof, and will be subject to market conditions. Such purchases will be structured as permitted by securities laws and other legal requirements. The share repurchase program has no expiration date.

~~The following table sets forth information with respect to our~~ No common shares were purchased by us during the three months ended March 31, ~~2020:~~2021.

ISSUER PURCHASES OF EQUITY SECURITIES
Period (a) Total Number of Shares Purchased (b) Average Price Paid per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
January 1, 2020 - January 31, 2020 —
$ —
—
$ 184,713,820
February 1, 2020 - February 29, 2020 —
—
—
184,713,820
March 1, 2020 - March 31, 2020 704,795
5.43
704,795
180,886,791
Total 704,795
$ 5.43
704,795
$ 180,886,791

Additionally, during the three months ended March 31, ~~2020,~~2021, no Class A voting shares and ~~42,391~~64,261 Class B non-voting shares were withheld upon the vesting of restricted share units and share issuances to satisfy minimum statutory federal, state and local tax withholding obligations.

Unregistered Sales of Equity Securities

~~AT&T Media Holdings~~

On ~~October 21, 2016,~~April 2, 2021, the Company ~~its indirect subsidiary Lions Gate Entertainment Inc. (“LGEI”) and AT&T Media Holdings~~ entered into ~~a Securities Issuance~~an amendment to the Amended and ~~Payment~~Restated Limited Liability Company Operating Agreement of Pilgrim Media Group, LLC dated as of November 12, 2015 (the ~~“Securities Issuance Agreement”~~“Agreement”)~~, pursuant to which~~. In consideration for certain amendments under the Agreement, the Company ~~and LGEI agreed~~issued a warrant to issue to AT&T Media Holdings, Inc. (“AT&T”) $50 million in, at LGEI’s election, (a) an equal number of the Company’s Class A voting shares and Class B non-voting shares, (b) cash or (c) a combination thereof, and paid in three $16.67 million annual installments, beginning on the first anniversary of December 8, 2016, the consummation of the Company’s acquisition of Starz. The Company issued the Company's Class A voting shares and the Company'spurchase 459,217 Class B non-voting shares to ~~AT&T in 2017, 2018~~Pilgrim Media Group Holdings, LLC and ~~2019. The Company’s Class A voting shares and Class B non-voting shares were deemed~~a warrant to have a value equal to the 30-day volume weighted average price of the Company’s Class A voting shares and Class B non-voting shares on the New York Stock Exchange, respectively, as of the business day immediately prior to the applicable payment date. ~~On December 19, 2019, in connection with the Securities Issuance Agreement, the Company issued 929,023 of the Company's Class A voting shares and 980,392 of the Company's~~purchase 40,783 Class B non-voting shares to ~~AT&T.~~ Whirlwind Entertainment

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Group, Inc. The Company’s ~~Class A voting shares and~~ Class B non-voting shares issued pursuant to the ~~Securities Issuance~~ Agreement were issued as a private placement ~~to AT&T~~ in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended.

~~3 Arts Entertainment~~

On May 29, 2018, the Company and LGEI entered into a Membership Interest Purchase Agreement with 3 Arts Entertainment (“3 Arts”) and certain other sellers therewith (the “Purchase Agreement”) pursuant to which the Company purchased a 51% membership interest in 3 Arts. The purchase price was approximately $166.6 million, of which 50% was paid in cash at closing, 32.5% was paid in the Company's Class B non-voting shares at closing, and 17.5% was paid in the Company's Class B non-voting shares on the one-year anniversary of closing, subject to certain conditions. The number of shares issued was determined by dividing the dollar value of the portion of the purchase price to be paid by the daily weighted average closing price of the Company's Class B non-voting shares on the New York Stock Exchange for the twenty (20) consecutive trading days immediately preceding the closing date. On June 17, 2019, in connection with the Purchase Agreement, the Company issued 1,334,332 of the Company's Class B non-voting shares to the sellers therewith as the balance of the purchase price. The Company’s Class B non-voting shares issued pursuant to the Purchase Agreement were issued as a private placement to 3 Arts in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended.

Stock Performance Graph

The following graph compares our cumulative total shareholder return with those of the NYSE Composite Index and the S&P Movies & Entertainment Index for the period commencing March 31, ~~2015~~2016 and ending March 31, ~~2020.~~2021. All values assume that $100 was invested on March 31, ~~2015~~2016 in our common shares and each applicable index and all dividends were reinvested.

The comparisons shown in the graph below are based on historical data and we caution that the stock price performance shown in the graph below is not indicative of, and is not intended to forecast, the potential future performance of our common shares.


	3/15	3/16	12/9/16	3/17	3/18	3/19	3/20		3/16	12/9/16	3/17	3/18	3/19	3/20	3/21
Lions Gate Entertainment Corporation-Class A⁽¹⁾	$100.00	$65.14		$79.54	$77.62	$47.36	$18.41	Lions Gate Entertainment Corporation-Class A(1)	$100.00		$122.10	$119.16	$72.70	$28.26	$69.49
Lions Gate Entertainment Corporation-Class B⁽¹⁾			$100.00	$92.45	$91.66	$57.94	$21.41	Lions Gate Entertainment Corporation-Class B(1)		$100.00	$92.45	$91.66	$57.94	$21.41	$49.50
NYSE Composite	$100.00	$96.09		$111.01	$123.23	$128.93	$107.36	NYSE Composite	$100.00		$115.53	$128.25	$134.18	$111.74	$173.26
Dow Jones US Media Sector	$100.00	$97.80		$118.11	$110.93	$124.13	$106.84	Dow Jones US Media Sector	$100.00		$120.77	$113.43	$126.92	$109.24	$192.19

________________


~~(1)~~	Immediately prior to the December 8, 2016 consummation of the Starz merger, we effected the reclassification of our capital stock, pursuant to which each existing Lionsgate common share was converted into 0.5 shares of a newly issued Class A voting shares and 0.5 shares of a newly issued Class B non-voting shares, subject to the terms and conditions of the merger agreement.

(1)Immediately prior to the December 8, 2016 consummation of the Starz merger, we effected the reclassification of our capital stock, pursuant to which each existing Lionsgate common share was converted into 0.5 shares of a newly

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issued Class A voting shares and 0.5 shares of a newly issued Class B non-voting shares, subject to the terms and conditions of the merger agreement.

The graph and related information are being furnished solely to accompany this Form 10-K pursuant to Item 201(e) of Regulation S-K. They shall not be deemed “soliciting materials” or to be “filed” with the SEC (other than as provided in Item 201), nor shall such information be incorporated by reference into any future filing under the Securities Act or the Exchange Act, except to the extent that we specifically incorporate it by reference into such filing.

ITEM 6. SELECTED FINANCIAL DATA.

~~The consolidated financial statements for all periods presented in this Form 10-K are prepared in conformity with U.S. GAAP.~~Reserved.

The Selected Consolidated Financial Data below includes the results of 3 Arts Entertainment from its acquisition date of May 29, 2018 onwards, Starz from its acquisition date of December 8, 2016 onwards, and Pilgrim Media Group from its acquisition date of November 12, 2015 onwards. Due to the acquisitions of 3 Arts Entertainment, Starz, and Pilgrim Media Group, the Company’s results of operations for the years ended March 31, 2020, 2019, 2018, 2017, and 2016 and financial positions as at March 31, 2020, 2019, 2018, 2017, and 2016 are not directly comparable to prior reporting periods.

Year Ended March 31,

2020⁽¹⁾⁽⁵⁾

2019⁽²⁾⁽⁵⁾

2018⁽³⁾

2017⁽⁴⁾

2016⁽⁴⁾
(Amounts in millions, except per share amounts)
Statement of Operations Data:
Revenues $ 3,890.0
$ 3,680.5
$ 4,129.1
$ 3,201.5
$ 2,347.4
Operating income (loss) 2.8
130.0
248.7
(16.3 ) (25.0 )
Net income (loss) (206.4 ) (299.6 ) 468.1
14.5
42.7
Net income (loss) attributable to Lions Gate Entertainment Corp. shareholders (188.4 ) (284.2 ) 473.6
14.8
50.2
Per share information attributable to Lions Gate Entertainment Corp. shareholders:
Basic net income (loss) per common share $ (0.86 ) $ (1.33 ) $ 2.27
$ 0.09
$ 0.34
Diluted net income (loss) per common share $ (0.86 ) $ (1.33 ) $ 2.15
$ 0.09
$ 0.33
Weighted average number of common shares outstanding:
Basic 217.9
213.7
208.4
165.0
148.5
Diluted 217.9
213.7
220.4
172.2
154.1
Dividends declared per common share $ —
$ 0.18
$ 0.09
$ 0.09
$ 0.34

Balance Sheet Data (at end of period):
Cash and cash equivalents $ 318.2
$ 184.3
$ 378.1
$ 321.9
$ 57.7
Investment in films and television programs and program rights 1,827.8
1,967.7
1,945.2
1,991.2
1,457.6
Total assets 7,951.2
8,408.9
8,967.6
9,196.9
3,834.2
Total debt, net⁽⁶⁾
2,733.0
2,904.4
2,557.4
3,124.9
865.2
Production loans, net 151.3
385.4
352.5
353.3
690.0
Dissenting shareholders' liability⁽⁷⁾
—
—
869.3
812.9
—
Redeemable noncontrolling interests 167.8
127.6
101.8
93.8
90.5
Total Lions Gate Entertainment Corp. shareholders' equity 2,658.0
2,918.7
3,155.9
2,514.4
850.3
Total equity 2,660.0
2,921.9
3,156.9
2,514.4
850.3

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~~_______________________~~

~~(1)~~

Results for fiscal 2020 included restructuring and other charges of $24.3 million, incremental direct operating and distribution and marketing expense incurred as a direct result of the COVID-19 global pandemic of $50.2 million, certain programming and content charges of $76.5 million in connection with the implementation of changes to the Company's programming and broadcasting strategy, and a charge of $21.4 million from the net increase in the valuation allowance for certain of the Company's deferred tax assets.

~~(2)~~

Results for fiscal 2019 included restructuring and other charges of $78.0 million, certain programming and content charges of $35.1 million in connection with the implementation of changes to the Company's programming and broadcasting strategy, shareholder litigation settlements of $114.1 million, and a charge of $53.7 million from the net increase in the valuation allowance for certain of the Company's deferred tax assets.


~~(3)~~	Results for fiscal 2018 included restructuring and other charges of $59.8 million, gain on investments of $171.8 million, and a net tax benefit of $259.1 million from the impact of the corporate tax rate change on net deferred tax liabilities and other discrete items.


~~(4)~~	~~Results for fiscal 2017 and fiscal 2016 included restructuring and other charges of $88.7 million and $19.8 million, respectively, and fiscal 2017 also included a gain on investments of $20.4 million.~~


~~(5)~~	Effective April 1, 2018, the Company adopted new guidance on revenue recognition on a modified-retrospective basis. Accordingly, the selected financial data for periods prior to April 1, 2018 is not directly comparable. See Note 13 to the Company's consolidated financial statements for further information.


~~(6)~~	~~Total debt includes corporate debt, convertible senior subordinated notes and finance lease obligations, net of unamortized discount and debt issuance costs, if applicable.~~


~~(7)~~	~~Dissenting shareholders' liability was classified as a current liability as of March 31, 2018, and as a non-current liability as of March 31, 2017.~~

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

This section of our Annual Report Form 10-K includes a discussion and analysis of our financial condition and results of operation for the fiscal years ended March 31, ~~2020~~2021 and ~~2019,~~2020, and year-to-year comparisons between fiscal ~~2020~~2021 and fiscal ~~2019.~~2020. A discussion and analysis of our financial condition and results of operation for the fiscal year ended March 31, ~~2018~~2019 and year-to-year comparisons between fiscal ~~2019~~2020 and fiscal ~~2018~~2019 can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended March 31, ~~2019~~2020, and is herein incorporated by reference.

Overview

Combining the STARZ premium global subscription platform with world-class motion picture and television studio operations, Lions Gate Entertainment Corp. (the “Company,” “Lionsgate,” "Lions Gate," “we,” “us” or “our”) isbrings a ~~global content leader whose films, television series, digital products~~unique and ~~linear and over-the-top platforms reach next generation audiences~~varied portfolio of entertainment to consumers around the world. ~~Lionsgate’s~~Our film, ~~and~~ television, ~~properties support~~subscription and location-based entertainment ~~venues and other branded attractions, as well as a video game business. Lionsgate's content initiatives~~businesses are backed by a ~~nearly~~ 17,000-title library and one of the largest collections of film and television ~~library and delivered through a global sales and licensing infrastructure.~~franchises in the independent media space. We classify our operations through three reporting segments: Motion Picture, Television Production, and Media Networks (see further discussion below).

~~Impact of~~ COVID-19

Global Pandemic

~~The impact of~~

In fiscal 2021, the impacts associated with the ongoing COVID-19 global pandemic and measures to prevent its spread, and the resulting ~~unprecedented~~ economic uncertainty, ~~are affecting~~affected our business in a number of ways. ~~To date, we have~~We experienced early termination ~~of the~~and delays in theatrical ~~run of one~~distribution of our films, ~~domestically and one of our films in the UK, delayed theatrical distribution of several films~~both domestically and internationally, as well as delays in the ~~delayed~~ production of film and television content (resulting in continued changes in future release dates for some titles and series). ~~Our partners have also closed several location-based entertainment attractions based~~While we did begin (and, in certain instances, completed) production on ~~our film~~a number of films and television ~~properties. We may~~series, and theaters began to reopen in 2021 in certain locations with reduced capacity, we are not be able to accurately predict when theaters will re-open at scale, at what level consumers will return to movie theaters, when film production ~~resumes~~will fully resume, whether productions that have resumed will be paused again, the impact of incremental costs required to adhere to health and safety protocols, or if and when certain of our content will be released. The full extent of ~~the impact of~~impacts related to the COVID-19 global pandemic on our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict. See Item 1A. Risk Factors for further details.

Conversely, television and streaming consumption around the globe ~~has~~ increased, as well as home entertainment demand. STARZ ~~has~~ experienced an increase in viewership of its content across all platforms as well as an increase in subscribers to its OTT services, both domestically and internationally. ~~This~~However, it is too early to say whether this increase ~~however, may not be~~is indicative of future results and whether growth may slow as governmental and other restrictions are relaxed, and as a result of the current and possible longer term negative economic impact of the pandemic. ~~In a number of instances, we have also been able~~We continue, however, to adapt to these new ~~circumstances by releasing one~~circumstances. For instance, we changed the release strategies of several of our theatrical films by releasing solely and/or earlier on streaming platforms, ~~completing~~initially releasing on premium video-on-demand ("Premium VOD") market, or by licensing directly to streaming platforms. We also began and completed post-production of ~~one~~several of our television series ~~remotely~~ and ~~continuing~~continue the development of ~~a number of our~~film properties and television series utilizing virtual writers’ rooms. These changes in the way we operate may be helpful to partially offset some of the negative impacts from the pandemic, however the ultimate impact of these changes and the COVID-19 global pandemic cannot be predicted with certainty.

series.

In connection with the disruptions associated with the COVID-19 global pandemic and measures to prevent its spread and mitigate its effects both domestically and internationally, and the related economic disruption, including the worldwide closure of most theaters, international travel restrictions and the pausing of motion picture and television productions, during the ~~fourth quarter of~~ fiscal years ended March 31, 2021 and 2020, we have incurred $70.5 million and $50.5 million, respectively, in incremental costs which were expensed in the period. These costs include $50.6 million and $46.0 million, respectively, reflected in direct operating expense, which include ~~certain motion picture and television impairments and development charges~~incremental costs associated with film impairment due to changes in performance expectations, ~~or the feasibility of completing the project, costs associated with~~ the pausing and restarting of productions including certain cast and crew, idle facilities and equipment costs ~~and incremental costs~~resulting from circumstances associated with ~~bad debt reserves.~~the COVID-19 global pandemic. In addition, these costs include $16.9 million and $4.2 million, respectively, reflected in distribution and marketing expense, which primarily consists of ~~early~~contractual marketing spends for film releases and events that ~~have been~~were canceled or delayed and will provide no economic benefit, and $3.0 million and $0.3 million in restructuring and other costs primarily due to transitioning the Company to a remote-work environment and other incremental costs associated with the COVID-19 global pandemic during ~~this period.~~these periods. We expect to incur additional incremental costs in future periods. However, if the adverse economic impact and disruptions associated with the COVID-19 global pandemic continue to improve, we expect that the incremental costs we incur in future periods will decrease as compared to fiscal 2021. We are in the process of seeking insurance recovery for some of these costs, which cannot be estimated at this

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time, and therefore no material amounts of insurance proceeds have ~~not~~ been recorded in our consolidated financial statements. See further discussion in the Results of Operations section below.

WeThe economic impact of the COVID-19 global pandemic and resulting societal changes will depend on numerous evolving factors that cannot be predicted with certainty. There are a number of ways in which these uncertainties resulting from the COVID-19 global pandemic have impacted our current results of operations and could continue to impact our future results of operations. These impacts include the incremental costs and losses discussed in the previous paragraph, lower revenues from the closure of movie theaters and postponement of theatrical releases, partially offset by lower theatrical production and marketing costs; increased expenses associated with new health and safety protocols on motion picture and television productions; changes in the timing of revenues for motion pictures and television productions associated with delays in production and delivery or release; and while STARZ has experienced an increase in viewership of its content, future growth could be impacted by the timing of when productions will fully resume, and whether productions that have resumed will be paused again.

While we have experienced recent improvements in the United States with declining COVID-19 cases and increases in the number of people vaccinated, we expect that the ultimate impact of these disruptions, including the extent of any adverse impact on our business, results of operations and financial condition, will depend on, among other things, the duration and spread of the pandemic, the impact

of governmental regulations that have been, and may continue to be, imposed in response to the pandemic, the effectiveness of actions taken to contain or mitigate the outbreak (including the availability, effectiveness and/or public acceptance of any U.S. Food and Drug Administration ("FDA")-approved COVID-19 vaccines), and global economic conditions ~~as a result of~~related to the COVID-19 global pandemic. All of these impacts could place limitations on our ability to execute on our business plan and materially and adversely affect our business, financial condition and results of operations. We ~~continue to monitor the situation,~~ have ~~actively~~ implemented policies, procedures and ~~procedures~~protocols to address the situation and ~~may~~expect to continue to adjust our current policies and procedures as more information and guidance become ~~available~~available. In addition, resurgences of COVID-19 in certain parts of the world, and the discovery of new variants of the virus, may result in the re-imposition of certain restrictions and may lead to ~~address~~more restrictions being implemented again to reduce the ~~evolving situation. Accordingly, due~~spread of COVID-19. These measures could result in further interruptions to our operations. Due to the evolving and uncertain nature of this situation, we are not able to estimate the full extent of the impact on our operating results, cash flows and financial position, particularly over the near to medium term.

Revenues

Our revenues are derived from the Motion Picture, Television Production and Media Networks segments, as described below. Our revenues are derived from the U.S., Canada, the United Kingdom and other foreign countries. None of the non-U.S. countries individually comprised greater than 10% of total revenues for the years ended March 31, 2021, 2020 ~~2019~~ and ~~2018.~~2019.

Motion Picture

Our Motion Picture segment includes revenues derived from the following:

•

•Theatrical. Theatrical revenues are derived from the domestic theatrical release of motion pictures licensed to theatrical exhibitors on a picture-by-picture basis (distributed by us directly in the U.S. and through a sub-distributor in Canada). The revenues from Canada are reported net of distribution fees and release expenses of the Canadian sub-distributor. The financial terms that we negotiate with our theatrical exhibitors in the U.S. generally provide that we receive a percentage of the box office results.

•Television. Television revenues are primarily derived from the licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets.

•International. International revenues are derived from (1) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis; and (2) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom.

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•Theatrical revenues are derived from the domestic theatrical release of motion pictures licensed to theatrical exhibitors on a picture-by-picture basis (distributed by us directly in the U.S. and through a sub-distributor in Canada). The revenues from Canada are reported net of distribution fees and release expenses of the Canadian sub-distributor. The financial terms that we negotiate with our theatrical exhibitors in the U.S. generally provide that we receive a percentage of the box office results.

•

~~Home Entertainment.~~ Home entertainment revenues are derived from the sale or rental of our film productions and acquired or licensed films and certain television programs (including theatrical and direct-to-video releases) on packaged media and through digital media platforms (including pay-per-view and video-on-demand platforms, electronic sell through, and digital rental). In addition, we have revenue sharing arrangements with certain digital media platforms which generally provide that, in exchange for a nominal or no upfront sales price, we share in the rental or sales revenues generated by the platform on a title-by-title basis.


•	~~Television.~~ ~~Television revenues are primarily derived from the licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets.~~


•	~~International.~~ International revenues are derived from (1) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis; and (2) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom.


•	Other. Other revenues are derived from, among others, the licensing of our film and television and related content (games, music, location-based entertainment royalties, etc.) to other ancillary markets.

Television Production

Our Television Production segment includes revenues derived from the following:

•

•Television. Television revenues are derived from the licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks. Television revenues also include revenue from licenses to subscription-video-on-demand ("SVOD") platforms in which the initial license of a television series is to an SVOD platform.

•Home Entertainment. Home entertainment revenues are derived from the sale or rental of television production movies or series on packaged media and through digital media platforms.

• Television revenues are derived from the licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks. Television revenues also include revenue from licenses to subscription-video-on-demand ("SVOD") platforms in which the initial license of a television series is to an SVOD platform.


•	~~International.~~ ~~International revenues are derived from the licensing and syndication to international markets of scripted and unscripted series, television movies, mini-series and non-fiction programming.~~


•	~~Home Entertainment.~~ ~~Home entertainment revenues are derived from the sale or rental of television production movies or series on packaged media and through digital media platforms.~~


•	Other. Other revenues are derived from, among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions earned and executive producer fees related to talent management.

Media Networks

Our Media Networks segment includes revenues derived from the ~~following product lines:~~following:

•

~~Starz Networks.~~ Starz Networks’ revenues are derived from the domestic distribution of our STARZ branded premium subscription video services pursuant to affiliation agreements with U.S. multichannel video programming distributors (“MVPDs”), including cable operators, satellite television providers and telecommunications companies, and over-the-top ("OTT") (collectively, “Distributors”), and on a direct-to-consumer basis.

•Starz Networks. Starz Networks’ revenues are derived from the domestic distribution of our STARZ branded premium subscription video services through over-the-top ("OTT") platforms and U.S. multichannel video programming distributors (“MVPDs”) including cable operators, satellite television providers and telecommunications companies (collectively, “Distributors”) and on a direct-to-consumer basis through the Starz App.

•STARZPLAY International.STARZPLAY International revenues are primarily derived from OTT distribution of the Company's STARZ branded premium subscription video services outside of the U.S.

•Other Streaming Services. Other Streaming Services revenues are derived primarily from our formerly majority owned premium Spanish language streaming services business, Pantaya, which includes subscriber based streaming revenue and other distribution revenue. We sold our interest in Pantaya on March 31, 2021, for approximately $123.6 million in cash, subject to certain customary adjustments pursuant to the terms of the agreement. Under the terms of the purchase agreement, control of Pantaya transferred to Hemisphere Media Group on March 31, 2021, with the cash consideration transferred on April 1, 2021. See Note 2 to our consolidated financial statements for further information.


•	~~STARZPLAY International.STARZPLAY International revenues are primarily derived from OTT distribution of the Company's STARZ branded premium subscription video services internationally.~~


•	~~Other Streaming Services.~~ ~~Other Streaming Services revenues are derived primarily from our majority owned premium Spanish language streaming services business, Pantaya.~~

Expenses

Our primary operating expenses include direct operating expenses, distribution and marketing expenses and general and administration expenses.

Direct operating expenses include amortization of film and television production or acquisition costs, amortization of programming production or acquisition costs and programming related salaries, participation and residual expenses, provision for doubtful accounts, and foreign exchange gains and losses.

Participation costs represent contingent consideration payable based on the performance of the film or television program to parties associated with the film or television program, including producers, writers, directors or actors. Residuals represent amounts payable to various unions or “guilds” such as the Screen Actors Guild - American Federation of Television and Radio Artists, Directors Guild of America, and Writers Guild of America, based on the performance of the film or television program in certain ancillary markets or based on the individual’s (i.e., actor, director, writer) salary level in the television market.

Distribution and marketing expenses primarily include the costs of theatrical prints and advertising (“P&A”) and of DVD/Blu-ray duplication and marketing. Theatrical P&A includes the costs of the theatrical prints delivered to theatrical exhibitors and the advertising and marketing cost associated with the theatrical release of the picture. DVD/Blu-ray duplication represents the cost of the DVD/Blu-ray product and the manufacturing costs associated with creating the physical products. DVD/Blu-ray marketing costs represent the cost of advertising the product at or near the time of its release or special promotional advertising.

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Marketing costs for Media Networks includes advertising, consumer marketing, distributor marketing support and other marketing costs. In addition, distribution and marketing costs includes our Media Networks segment operating costs for the direct-to-consumer service, transponder expenses and maintenance and repairs.

General and administration expenses include salaries and other overhead.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

~~The~~Our accounting policies are more fully described in Note 1 to our consolidated financial statements. As disclosed in Note 1 to our consolidated financial statements, the preparation of our financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The application of the following accounting policies, which are important to our financial position and results of operations, requires significant judgments and estimates on the part of management. As described more fully below, these estimates bear the risk of change due to the inherent uncertainty of the estimate. In some cases, changes in the accounting estimates are reasonably likely to occur from period to period. In addition, the evolving and uncertain nature of the COVID-19 global pandemic could materially impact our estimates, particularly those that require consideration of forecasted financial information, in the near to medium term. Accordingly, actual results could differ materially from our estimates. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations will be affected. We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. ~~For a summary of all~~We believe that the following discussion addresses our most critical accounting policies, which are those that are most important to the portrayal of our ~~accounting policies, including the accounting policies discussed below, see Note 1 to our consolidated~~ financial ~~statements.~~condition and results of operations and require management's most difficult, subjective and complex judgments.

Accounting for Films and Television Programs and Licensed Program ~~Rights.~~ ~~We capitalize~~Rights

On April 1, 2020, we adopted, on a prospective basis, new Financial Accounting Standards Board ("FASB") guidance on the accounting for costs of ~~production and acquisition, including financing costs and production overhead, to investment in~~ films and episodic television ~~programs. These~~series. Under that new guidance, capitalized costs for an

~~individual film~~films or television program are amortized and ~~participation~~tested for impairment based on whether the content is predominantly monetized individually or as a group. See Note 1 to our consolidated financial statements for further information.

Film and ~~residual~~Television Programs Monetized Individually. For films and television programs monetized individually, film cost amortization, participations and residuals expense are based on management's estimates. Costs of acquiring and producing films and television programs and of acquired libraries that are monetized individually are amortized and estimated liabilities for participations and residuals costs are accrued ~~to direct operating expenses in~~using the ~~proportion that current year’s revenues bear to management’s estimates of~~individual-film-forecast method, based on the ~~ultimate revenue at the beginning~~ratio of the current ~~year expected~~period's revenues to management’s estimated remaining total gross revenues to be ~~recognized from~~earned ("ultimate revenue"). Management's judgment is required in estimating ultimate revenue and the ~~exploitation, exhibition or sale~~costs to be incurred throughout the life of ~~such~~each film or television program. ~~Ultimate~~

Management estimates ultimate revenues based on historical experience with similar titles or the title genre, the general public appeal of the cast, audience test results when available, actual performance (when available) at the box office or in markets currently being exploited, and other factors such as the quality and acceptance of motion pictures or programs that our competitors release into the marketplace at or near the same time, critical reviews, general economic conditions and other tangible and intangible factors, many of which we do not control and which may change.

For motion pictures, ultimate revenue includes estimates over a period not to exceed ten years following the date of initial release of the motion picture. The most sensitive factor affecting our estimate of ultimate revenues for a film intended for theatrical release is the film's theatrical performance, as subsequent revenues from the licensing and sale in other markets have historically been highly correlated to its theatrical performance. After a film's release, our estimates of revenue from succeeding markets are revised based on historical relationships and an analysis of current market trends.

For an episodic television series, the period over which ultimate revenues are estimated cannot exceed ten years following the date of delivery of the first episode, or, if still in production, five years from the date of delivery of the most recent episode, if later. The most sensitive factors affecting our estimate of ultimate revenues for a television series is whether the series will be ordered for a subsequent season and estimates of revenue in secondary markets other than the initial license fee. The initial estimate of ultimate revenue may include estimates of revenues outside of the initial license window (i.e., international, home entertainment and other distribution platforms) and are based on historical experience for similar programs (genre, duration, etc.) based on the estimated number of seasons. We regularly monitor the performance of each season, and evaluate whether impairment indicators are present (i.e., low ratings, cancellations or the season is not reordered), and based upon our review, we revise our estimates as needed and perform an impairment assessment if impairment indicators are present (see below).

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For ~~previously released film or television programs~~titles included in acquired ~~as part of a library,~~libraries, ultimate revenue includes estimates over a period not to exceed twenty years ~~from~~following the date of acquisition.

Due to the inherent uncertainties involved in making such estimates of ultimate revenues and expenses, these estimates have differed in the past from actual results and are likely to differ to some extent in the future from actual results. In addition, in the normal course of our business, some films and titles are more successful or less successful than anticipated. Management regularly reviews and revises when necessary its ultimate revenue and cost estimates, which may result in a change in the rate of amortization of film costs and participations and residuals and/or a write-down of all or a portion of the unamortized costs of the film or television program to its estimated fair value. Management estimates the ultimate revenue based on experience with similar titles or title genre, the general public appeal of the cast, audience test results when available, actual performance (when available) at the box office or in markets currently being exploited, and other factors such as the quality and acceptance of motion pictures or programs that our competitors release into the marketplace at or near the same time, critical reviews, general economic conditions and other tangible and intangible factors, many of which we do not control and which may change.value (see below).

An increase in the estimate of ultimate revenue will generally result in a lower amortization rate and, therefore, less film and television program amortization expense, while a decrease in the estimate of ultimate revenue will generally result in a higher amortization rate and, therefore, higher film and television program amortization expense, and also periodically results in an impairment requiring a write-down of the film cost to the title’s fair value. These write-downs are included in amortization expense within direct operating expenses in our consolidated statements of operations. ~~Investment in films~~See further discussion below under Impairment Assessment.

Film and television programs is stated at the lower of amortized cost or estimated fair value. The valuation of investment in films and television programs, whether released or unreleased, is reviewed on a title-by-title basis, when an event or change in circumstances indicates that the fair value of a film or television program is less than its unamortized cost. In determining the fair value of our films and television programs, we generally employ a discounted cash flows ("DCF") methodology with assumptions for cash flows (a Level 3 fair value measurement, see Note 11 to our consolidated financial statements). Key inputs employed in the DCF methodology include estimates of a film's ultimate revenue as discussed above, and costs as wellTelevision Programs Monetized as a discount rate. The discount rate utilized in the DCF analysis is based on our weighted average cost of capital plus a risk premium representing the risk associated with producing a particular film or television program. The fair value of any film costs associated with a film or television program that we plan to abandon is zero. Additional amortization is recorded in the amount by which the unamortized costs exceed the estimated fair value of the film or television program. Estimates of future revenue involve measurement uncertainty and it is therefore possible that reductions in the carrying value of investment in films and television programs may be required as a consequence of changes in our future revenue estimates.

Program rights include content licensed from third parties and content produced by and licensed from the Television Production segment. Program rights for films and television programs (including original series) exhibited by the Media Networks segment are generally amortized on a title-by-title or episode-by-episode basis over the anticipated number of exhibitions or license period. We estimate the number of exhibitions based on the number of exhibitions allowed in the agreement and the expected usage of the content. Certain other program rights are amortized to expense on a straight-line basis over the respective lives of the agreements. ProgrammingGroup. Licensed programming rights may include rights to more than one exploitation window under ~~its~~the Company's output and library agreements. For films with multiple windows, the license fee is allocated between the windows based upon the proportionate estimated fair value of each window which generally results in the majority of the cost allocated to the first window on newer releases. Certain license agreements and productions may include additional ancillary rights in addition to the pay television rights. The cost of the Media Networks’ third-party licensed content and produced content is allocated between the pay television market distributed by the Media Networks’ segment and the ancillary revenue markets (e.g., home video, digital platforms, international television, etc.) based on the estimated relative fair values of these markets. Our estimates of fair value for the pay television and ancillary markets and windows of exploitation involve uncertainty and management judgment. Programming costs vary due to the number of airings and cost of our original series, the number of films licensed and the cost per film paid under our output and library programming agreements.

The cost of the Media Networks' segments produced original content generally represents the license fees charged from the Television Production segment which are eliminated in consolidation. The amount associated with the pay television market is reclassified to program rights when the program is aired and the portion attributable to the ancillary markets remains in investment in films and television programs. The cost of the Media Networks’ third-party licensed content is allocated between the pay television market distributed by the Media Networks’ segment and the ancillary revenue markets (e.g., home video, digital platforms, international television, etc.) distributed by the Television Production segment based on the estimated relative fair values of these markets. Estimates of fair value for the pay television and ancillary markets involve uncertainty as well as estimates of ultimate revenue. All the costs of programming produced by the Television Production segment are included in investment in films and television programs (including original series) exhibited by the Media Networks segment are generally amortized on an accelerated or straight-line basis based on the anticipated number of exhibitions or expected and ~~program rights, net~~historical viewership patterns or the license period on a title-by-title or episode-by-episode basis. The number of exhibitions is estimated based on the number of exhibitions allowed in the agreement (if specified) and the expected usage of the content. Participations and residuals are ~~classified as long term. Amounts included~~expensed in line with the amortization of production costs.

~~program rights, other than internally produced programming, that are expected to be amortized within a year from the balance sheet date are classified as short-term.~~

~~Licensed content is stated at the lower of amortized cost or net realizable value, and produced original content is stated at the lower of amortized cost or estimated fair value, as discussed above.~~ Changes in management’s estimate of the anticipated exhibitions and viewership patterns of films and original series on our networks could result in the earlier recognition of our programming costs than anticipated. Conversely, scheduled exhibitions and expected viewership patterns may not capture the appropriate usage of the program rights in current periods which would lead to the write-off of additional program rights in future periods and may have a significant impact on our future results of operations and our financial position.

Impairment Assessment. A film group or individual film or television program is evaluated for impairment when events or changes in circumstances indicate that the fair value of an individual film or film group is less than its unamortized cost. If the result of the impairment test indicates that the carrying value exceeds the estimated fair value, an impairment charge will then be recorded for the amount of the difference.

Estimate of Fair Value. For content that is predominantly monetized individually (primarily investment in film and television programs related to the Motion Picture and Television Production segments), the fair value is determined based on a discounted cash flow analysis of the cash flows directly attributable to the title. For motion pictures intended for theatrical release, the discounted cash flow analysis used in the impairment evaluation prior to theatrical release is subjective as key inputs include estimates of future anticipated revenues, estimates of box office performance, which may differ from future actual results. These estimates are based in part on the historical performance of similar films, test audience results when available, information regarding competing film releases, and critic reviews. See further discussion of Valuation Assumptions below.

For content that is predominantly monetized as a group (primarily licensed program rights in the Media Networks segment and internally produced programming, as discussed above), the fair value is determined based on the present value of the discounted cash flows of the group using the lowest level for which identifiable cash flows are independent of other produced and licensed content. The Company's film groups are generally aligned along the Company's networks and digital content offerings domestically (i.e., Starz Networks and Other Streaming Services) and by territory or groups of territories internationally, wherein content assets are shared across the various territories and therefore, the territory or group of territories is the film group.

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Valuation Assumptions. The discounted cash flow analysis includes cash flows estimates of ultimate revenue and costs as well as a discount rate (a Level 3 fair value measurement, see Note 11 to our consolidated financial statements). The discount rate utilized in the discounted cash flow analysis is based on the weighted average cost of capital of the Company plus a risk premium representing the risk associated with producing a particular film or television program or film group. The fair value of any film costs associated with a film or television program that management plans to abandon is zero. Estimates of future revenue involve measurement uncertainty and it is therefore possible that reductions in the carrying value of investment in films and television programs may be required as a consequence of changes in management’s future revenue estimates.

Revenue Recognition. Our Motion Picture and Television Production segments generate revenue principally from the licensing of content in domestic theatrical exhibition, home entertainment (e.g., digital media and packaged media), television, and international market places. Our Media Networks segment generates revenue primarily from the distribution of our STARZ branded premium subscription video services and, through March 31, 2021, from our formerly majority owned premium Spanish language streaming services business, ~~Pantaya.~~Pantaya, which includes subscriber based streaming revenue and other distribution revenue. We sold our interest in Pantaya on March 31, 2021, see Note 2 to our consolidated financial statements for further information.

Our content licensing arrangements include fixed fee and minimum guarantee arrangements, and sales or usage based royalties. Our fixed fee or minimum guarantee licensing arrangements in the television, digital media and international markets may, in some cases, include multiple titles, multiple license periods (windows) with a substantive period in between the windows, rights to exploitation in different media, or rights to exploitation in multiple territories, which may be considered distinct performance obligations. When these performance obligations are considered distinct, the fixed fee or minimum guarantee in the arrangement is allocated to the title, window, media right or territory as applicable, based on estimates of relative standalone selling prices. The amounts related to each performance obligation (i.e., title, window, media or territory) are recognized when the content has been delivered, and the window for the exploitation right in that territory has begun, which is the point in time at which the customer is able to begin to use and benefit from the content.

Sales or usage based royalties represent amounts due to us based on the “sale” or “usage” of our content by the customer, and revenues are recognized at the later of when the subsequent sale or usage occurs, or the performance obligation to which some or all the sales or usage-based royalty has been allocated has been satisfied (or partially satisfied). Generally, when we license completed content (with standalone functionality, such as a movie, or television show), our performance obligation will be satisfied prior to the sale or usage. When we license intellectual property that does not have stand-alone functionality (e.g., brands, themes, logos, etc.), our performance obligation is generally satisfied in the same period as the sale or usage. The actual amounts due to us under these arrangements are generally not reported to us until after the close of the reporting period. We record revenue under these arrangements for the amounts due and not yet reported to us based on estimates of the sales or usage of these customers and pursuant to the terms of the contracts. Such estimates are based on information from our customers, historical experience with similar titles in that market or territory, the performance of the title in other markets and/or available data in the industry. While we believe these estimates are reasonable estimates of the amounts due under these arrangements, such estimated amounts could differ from the actual amounts to be subsequently reported by the customer, which could be higher or lower than our estimates, and could result in an adjustment to revenues in future periods.

Revenue from the theatrical release of feature films are treated as sales or usage-based royalties and recognized starting at the exhibition date and based on our participation in box office receipts of the theatrical exhibitor.

Digital media revenue sharing arrangements are recognized as sales or usage based royalties.

Revenue from the sale of physical discs (DVDs, Blu-ray or 4K Ultra HD), referred to as "Packaged Media", in the retail market, net of an allowance for estimated returns and other allowances, is recognized on the later of receipt by the customer or “street date” (when it is available for sale by the customer).

~~Revenue from commissions are recognized as such services are provided.~~

Media Networks revenues may be based on a fixed fee, subject to nominal annual escalations, or a variable fee (i.e., a fee based on number of subscribers who receive our networks or other factors). Media Networks programming revenue is recognized over the contract term based on the continuous delivery of the content to the distributor. The variable distribution fee arrangements represent sales or usage based royalties and are recognized over the period of such sales or usage by the Company's distributor, which is the same period that the content is provided to the distributor. Payments to distributors for marketing support costs for which Starz receives a discrete benefit are recorded as distribution and marketing costs, and payments to distributors for which Starz receives no discrete benefit are recorded as a reduction of revenue.

~~Sales Returns Allowance.~~ ~~Revenues are recorded net of estimated returns and other allowances.~~ We estimate reserves for Packaged Media returns based on previous returns experience, point-of-sale data available from certain retailers, current

economic trends, and projected future sales of the title to the consumer based on the actual performance of similar titles on a title-by-title basis in each of the Packaged Media businesses. Factors affecting actual returns include, among other factors, limited retail shelf space at various times of the year, success of advertising or other sales promotions, and the near term release of competing titles. We believe that our estimates have been materially accurate in the past; however, due to the judgment involved in establishing reserves, we may have adjustments to our historical estimates in the future. Our estimate of future returns affects reported revenue and operating income. If we underestimate the impact of future returns in a particular period, then we may record less revenue in later periods when returns exceed the estimated amounts. If we overestimate the impact of future returns in a particular period, then we may record additional revenue in later periods when returns are less than estimated. An incremental change of 1% in our estimated sales returns rate (i.e., provisions for returns divided by gross sales of related product) for home entertainment products would have had an impact of approximately $2.0 million, $3.6 million ~~$4.2 million~~ and ~~$6.0~~$4.2 million on our total revenue in the fiscal years ended March 31, 2021, 2020, and 2019, respectively.

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Revenue from commissions are recognized as such services are provided.

Media Networks revenues may be based on a fixed fee, subject to nominal annual escalations, or a variable fee (i.e., a fee based on number of subscribers who receive our networks or other factors). Media Networks programming revenue is recognized over the contract term based on the continuous delivery of the content to the distributor. The variable distribution fee arrangements represent sales or usage based royalties and ~~2018, respectively.~~are recognized over the period of such sales or usage by the Company's distributor, which is the same period that the content is provided to the distributor. Payments to distributors for marketing support costs for which Starz receives a discrete benefit are recorded as distribution and marketing costs, and payments to distributors for which Starz receives no discrete benefit are recorded as a reduction of revenue.

Goodwill and Indefinite-Lived Intangibles. At March 31, ~~2020,~~2021, the carrying value of goodwill and indefinite-lived intangible assets was $2.8 billion and $250.0 million, respectively. Our indefinite-lived intangible assets consist of trade names primarily representing the estimated fair value of the Starz brand name determined in connection with the acquisition of Starz as of December 8, 2016. Goodwill is allocated to our reporting units, which are our operating segments or one level below our operating segments (component level). Reporting units are determined by the discrete financial information available for the component and whether that information is regularly reviewed by segment management. Components are aggregated into a single reporting unit if they share similar economic characteristics. Our reporting units for purposes of goodwill impairment testing, along with their respective goodwill balances at March 31, ~~2020,~~2021, were Motion Picture (goodwill of $394 million), Media Networks (goodwill of ~~$2.04~~$1.97 billion), and our Television (goodwill of $309 million) and Talent Management (goodwill of $93 million) businesses, both of which are part of our Television Production segment.

Goodwill and indefinite-lived intangible assets are not amortized but are reviewed for impairment each fiscal year or between the annual tests if an event occurs or circumstances change that indicates it is more-likely-than-not that the fair value of a reporting unit or indefinite-lived intangible asset is less than its carrying value. We perform our annual impairment test as of January 1 in each fiscal year. A goodwill or indefinite-lived intangible asset impairment loss would be recognized for the amount that the carrying amount of a reporting unit, including goodwill or an indefinite-lived intangible asset, exceeds its fair value. An entity may perform a qualitative assessment of the likelihood of the existence of a goodwill or indefinite-lived intangible asset impairment. The qualitative assessment is an evaluation, based on all identified events and circumstances which impact the fair value of the reporting unit or indefinite-lived intangible asset, of whether or not it is more-likely-than-not that the fair value is less than the carrying value of the reporting unit or indefinite-lived intangible asset. If we believe that as a result of our qualitative assessment it is more likely than not that the fair value of a reporting unit or indefinite-lived intangible asset is greater than its carrying amount, a quantitative impairment test is not required but may be performed at the option of the Company. A quantitative assessment requires determining the fair value of our reporting units or indefinite-lived intangible assets. The determination of fair value requires considerable judgment and requires assumptions and estimates of many factors, including revenue and market growth, operating margins and cash flows, market multiples and discount rates.

In performing a quantitative assessment of goodwill, we determine the fair value of our reporting units by using a combination of discounted cash flow ("DCF") analyses and market-based valuation methodologies. The models rely on significant judgments and assumptions surrounding general market and economic conditions, short-term and long-term growth rates, discount rates, income tax rates, and detailed management forecasts of future cash flow and operating margin projections, and other assumptions, all of which are based on our internal forecasts of future performance as well as historical trends. The market-based valuation method utilizes EBITDA multiples from guideline public companies operating in similar industries and a control premium. The results of these valuation methodologies are weighted as to their relative importance and a single fair value is determined. The fair value of our reporting units is reconciled to the market value of our equity, determined based on the average prices of our common shares just prior to the period end. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors. As a result, there can be no assurance that the estimates and assumptions made for purposes of the annual or interim goodwill impairment tests will prove to be an accurate prediction of the future.

Goodwill Impairment Assessment:

For fiscal 2019, due primarily to the decline in the market price of our common shares, we performed a quantitative goodwill impairment assessment for all of our reporting units. Our quantitative goodwill impairment analysis of our reporting units indicated that the fair value of the reporting units exceeded their respective carrying values. However, our Television business reporting unit was considered at risk for impairment due to relatively small changes in certain key assumptions that could cause an impairment of goodwill. As a result, during fiscal 2020 we monitored all of our reporting units for changes in the business environment that could impact recoverability.

For the second quarter of fiscal 2020, due primarily to the sustained decline in the market price of our common shares, we updated our quantitative impairment assessment for three (Television, Media Networks and Motion Picture) of our reporting units. The DCF analysis of fair values were determined primarily by discounting estimated future cash flows, which included perpetual nominal growth rates ranging from 1.5% to 4.0%, at a weighted average cost of capital (discount rate) ranging from 10% to 14%, which considered the risk of achieving the projected cash flows, including the risk applicable to the reporting unit, industry and market as a whole. Based on our quantitative impairment assessment for the second quarter of fiscal 2020, we determined that there were no goodwill impairments; however, two of our reporting units (Television and Media Networks) were at risk for impairment due to relatively small changes in certain key assumptions that could cause an impairment of goodwill.

~~For~~ our annual goodwill impairment test for fiscal 2020, due to the decline in the market price of our common shares in the fourth quarter ended March 31, 2020, which was significantly impacted by the economic uncertainty and market volatility resulting from the COVID-19 global pandemic, we ~~updated our~~performed a quantitative impairment assessment for all of our reporting units as of March 31, 2020. The DCF analysis of fair values were determined primarily by discounting estimated future cash flows, which included perpetual nominal growth rates ranging from 1.5% to 4.0%, at a weighted average cost of capital (discount rate) ranging from 11.5% to 15%, which considered the risk of achieving the projected cash flows, including the risk applicable to the reporting unit, industry and market as a whole. Based on our annual quantitative impairment assessment for fiscal 2020, we determined that two of our reporting units (Television and Media Networks) were at risk for ~~impairment.~~impairment due to relatively small changes in certain key assumptions that could cause an impairment of goodwill.

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We evaluated the sensitivity of our most critical assumptions used in the fair value analysis of our Television and Media Networks reporting units, including the discount rate, perpetual nominal growth rate and annual revenue growth rates. For our Television business reporting unit, we determined that an increase in the discount rate of up to 3.3% would not have impacted the test results, assuming no changes to other factors. For our Media Networks reporting unit, we determined that an increase in the discount rate of up to 0.7% or a reduction of the perpetual nominal growth rate of up to 1.33% would not have impacted the test results, assuming no changes to other factors. We also performed a sensitivity analysis on annual revenue growth. We determined that a decrease in annual revenue growth by 0.5% for our Television business reporting unit and 0.3% for our Media Networks reporting unit, and holding film cost spend and amortization the same and maintaining other expenses at the same percentage of revenue, the results would have triggered an impairment.As a result of our quantitative assessment for fiscal 2020, we monitored all of our reporting units for changes in the business environment that could impact recoverability during fiscal 2021.

For our annual goodwill impairment test for fiscal 2021, due to the increase in the market price of our common shares since our most recent quantitative impairment assessment at March 31, 2020, the performance of the Television and Media Networks reporting units in fiscal 2021, and the improvement of overall economic conditions associated with the COVID-19 pandemic, we performed a qualitative assessment for all reporting units. This assessment included consideration of, but not limited to, the results of our most recent quantitative impairment test, consideration of macroeconomic conditions, industry and market conditions, performance and current and projected cash flows of our reporting units, and changes in our share price. Based upon our qualitative assessment, we concluded that it was more-likely-than-not that the fair value of our reporting units was greater than their carrying value.

Management will continue to monitor all of its reporting units for changes in the business environment that could impact the recoverability in future periods. The recoverability of goodwill is dependent upon the continued growth of revenue and cash flows from our business activities. Examples of events or circumstances that could result in changes to the underlying key assumptions and judgments used in our goodwill impairment tests, and ultimately impact the estimated fair value of our reporting units may include the duration of the COVID-19 global pandemic, its impact on the global economy and the creation and consumption of our content, and the timing of when remaining production can resume and remaining theaters can re-open; adverse macroeconomic conditions; volatility in the equity and debt markets which could result in higher weighted-average cost of capital; the commercial success of our television programming and our motion pictures; our continual contractual relationships with our customers; including our affiliate agreements of our Media Networks business; our subscriber growth rates domestically and internationally across our traditional and OTT platforms and changes in consumer behavior. While historical performance and current expectations have resulted in fair values of our reporting units in excess of carrying values, if our assumptions are not realized, it is possible that an impairment charge may need to be recorded in the future.

Indefinite-Lived Intangibles Other Than Goodwill Impairment Assessment:

For fiscal ~~2020,~~2021, we performed a qualitative impairment assessment of our indefinite-lived trade names. Based on the qualitative impairment assessment of our trade names, we concluded that it is more-likely-than-not that the fair value of our trade names was more than its carrying amount, and therefore our trade names were not considered at risk of impairment. This qualitative analysis considered the relative impact of market-specific and macroeconomic factors. The market-specific factors considered included recent projections of revenues and growth in OTT subscribers, both domestic and internationally, associated with the STARZ brand name. The Company also considered the macroeconomic impact including the uncertainty around the COVID-19 global pandemic, and the resulting uncertain long-term economic impact on discount rates and growth rates, as well as the impact from tax law changes inclusive of the reduction of the federal tax rate since the acquisition of Starz.

Finite-Lived Intangible Assets. At March 31, ~~2020,~~2021, the carrying value of our finite-lived intangible assets was approximately ~~$1.47~~$1.33 billion. Our finite-lived intangible assets primarily relate to customer relationships associated with U.S. MVPDs, including cable operators, satellite television providers and telecommunications companies ("Traditional Affiliate"), which amounted to ~~$1.45~~$1.31 billion. The amount of our customer relationship asset related to these Traditional Affiliate relationships reflects the estimated fair value of these customer relationships determined in connection with the acquisition of Starz on December 8, 2016, net of amortization recorded since the date of the Starz acquisition. Identifiable intangible assets with finite lives are amortized to depreciation and amortization expense over their estimated useful lives, ranging from 5 to 17

years. Through the first quarter of fiscal 2020 (see below), we amortized the Starz Traditional Affiliate customer relationships discussed above on a straight-line basis over 17 years.

Amortizable intangible assets are tested for impairment whenever events or changes in circumstances (triggering events) indicate that the carrying amount of the asset may not be recoverable. If a triggering event has occurred, an impairment analysis is required. The impairment test first requires a comparison of undiscounted future cash flows expected to be generated over the useful life of an asset to the carrying value of the asset. The impairment test is performed at the lowest level of cash flows

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associated with the asset. If the carrying value of the asset exceeds the undiscounted future cash flows, the asset would not be deemed to be recoverable. Impairment would then be measured as the excess of the asset’s carrying value over its fair value.

The Company monitors its finite-lived intangible assets and changes in the underlying circumstances each reporting period for indicators of possible impairments or a change in the useful life or method of amortization of our finite-lived intangible assets. Due to changes in the industry related to the migration from linear to OTT and direct-to-consumer consumption, in the second quarter of ~~the~~ fiscal ~~year ended March 31,~~ 2020, the Company determined it was appropriate to change the pattern of amortization of its Traditional Affiliate customer relationship intangible asset. Accordingly, beginning in the second quarter of ~~the~~ fiscal ~~year ended March 31,~~ 2020, the Company has adopted an amortization method that reflects amortization in the proportion that current period revenues bear to management’s estimate of future revenue over the remaining estimated useful life of the asset. This method results in greater amortization in the earlier years of the estimated useful life of the asset than the latter years. See Note 1 to our consolidated financial statements under the Finite-Lived Intangible Assets section for further details.

During ~~the~~ fiscal ~~year ended March 31,~~2021 and fiscal 2020, due to industry factors discussed in the preceding paragraph and the economic uncertainty from the COVID-19 global pandemic, we performed an impairment analysis of our amortizable intangible assets. The impairment analysis requires a comparison of undiscounted future cash flows expected to be generated over the useful life of an asset to the carrying value of the asset. Based on our impairment analysis, the estimated undiscounted cash flows exceeded the carrying amount of the assets and therefore no impairment charge was required.

Determining whether an intangible asset is recoverable or impaired requires various estimates and assumptions, including whether events or circumstances indicate that the carrying amount of the asset may not be recoverable, determining estimates of future cash flows for the assets involved and, when applicable, the assumptions applied in determining fair value, including discount rates, growth rates, market risk premiums and other assumptions about the economic environment. Should the revenues from our Traditional Affiliate relationships decline more than the assumed attrition rates used in our current estimates, either as a result of decreases in subscriber rates or changes of the terms of our renewals of our Traditional Affiliate contracts, we may have indicators of impairment which could result in an impairment of our customer relationships intangible assets, or we may need to further shorten the useful life or adopt a more accelerated method of amortization both of which would increase the amount of amortization expense we record.

~~Sales Returns Allowance.~~ Revenues are recorded net of estimated returns and other allowances. We estimate reserves for Packaged Media returns based on previous returns experience, point-of-sale data available from certain retailers, current economic trends, and projected future sales of the title to the consumer based on the actual performance of similar titles on a title-by-title basis in each of the Packaged Media businesses. Factors affecting actual returns include, among other factors, limited retail shelf space at various times of the year, success of advertising or other sales promotions, and the near term release of competing titles. We believe that our estimates have been materially accurate in the past; however, due to the judgment involved in establishing reserves, we may have adjustments to our historical estimates in the future. Our estimate of future returns affects reported revenue and operating income. If we underestimate the impact of future returns in a particular period, then we may record less revenue in later periods when returns exceed the estimated amounts. If we overestimate the impact of future returns in a particular period, then we may record additional revenue in later periods when returns are less than estimated. An incremental change of 1% in our estimated sales returns rate (i.e., provisions for returns divided by gross sales of related product) for home entertainment products would have had an impact of approximately $3.6 million, $4.2 million and $6.0 million on our total revenue in the fiscal years ended March 31, 2020, 2019, and 2018, respectively.

Income Taxes. We are subject to federal and state income taxes in the U.S., and in several foreign jurisdictions. We record deferred tax assets related to net operating loss carryforwards and certain temporary differences, net of applicable reserves in these jurisdictions. We recognize a future tax benefit to the extent that realization of such benefit is more likely than not on a jurisdiction-by-jurisdiction basis; otherwise, a valuation allowance is applied. In order to realize the benefit of our deferred tax assets, we will need to generate sufficient taxable income in the future in each of the jurisdictions which have these deferred tax assets. However, the assessment as to whether there will be sufficient taxable income in a jurisdiction to realize our net deferred tax assets in that jurisdiction is an estimate which could change in the future depending primarily upon the actual performance of our Company. We will be required to continually evaluate the more likely than not assessment that our net deferred tax assets will be realized, and if operating results deteriorate in a particular jurisdiction, we may need to record a valuation allowance for

all or a portion of our deferred tax assets through a charge to our income tax provision. As of March 31, ~~2020,~~2021, we have a valuation allowance of ~~$435.8~~$350.9 million against certain U.S. and foreign deferred tax assets that may not be realized on a more likely than not basis.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law, and has resulted in significant changes to the U.S. federal corporate tax law. Additionally, several state jurisdictions have enacted legislations to comply with federal changes and some foreign jurisdictions have enacted similar tax incentive legislations. As the enactment dates of these laws are before the end of the reporting period, we have considered the applicable tax law changes to our current and deferred income tax expense as of March 31, 2020 and concluded that the impact was immaterial. We are continuing to analyze the impact of these tax law changes to future periods.

Our effective tax rates differ from the federal statutory rate and are affected by many factors, including the overall level of pre-tax income (loss), the mix of our pre-tax income (loss) generated across the various jurisdictions in which we operate, any changes in tax laws and regulations in those jurisdictions, changes in uncertain tax positions, ~~further interpretation and legislative guidance regarding the new CARES Act,~~ changes in valuation allowances against our deferred tax assets, tax planning strategies available to us and other discrete items.

~~Consolidation and Other Investments.~~ We consolidate entities in which we own more than 50% of the voting common stock and control operations and also variable interest entities for which we are the primary beneficiary. Investments in nonconsolidated affiliates in which we own more than 20% of the voting common stock or otherwise exercise significant influence over operating and financial policies, but not control of the nonconsolidated affiliate, are accounted for using the equity method of accounting. Investments in nonconsolidated affiliates in which we own less than 20% of the voting common stock, or do not exercise significant influence over operating and financial policies, are recorded at fair value using quoted market prices if the investment has a readily determinable fair value. If an equity investment's fair value is not readily determinable, we will recognize it at cost less any impairment, adjusted for observable price changes in orderly transactions in the investees' securities that are identical or similar to our investments in the investee. The unrealized gains and losses and the adjustments related to the observable price changes are recognized in net income (loss).

We regularly review our investments for impairment, including when the carrying value of an investment exceeds its market value and whether the decline in value is other-than-temporary. For investments accounted for using the equity method of accounting or equity investments without a readily determinable fair value, we evaluate information available (e.g., budgets, business plans, financial statements, etc.) in addition to quoted market prices, if any, in determining whether an other-than-temporary decline in value exists. Factors indicative of an other-than-temporary decline include recurring operating losses, credit defaults and subsequent rounds of financing at an amount below the cost basis of our investment. The estimation of fair value and whether an other-than-temporary impairment has occurred requires the application of significant judgment and future results may vary from current assumptions. As of March 31, 2020, our investments included investments in equity method investees of $34.3 million, and other investments of $6.0 million.

If we determine that an investment has sustained an other-than-temporary decline in its value, the investment is written down to its fair value by a charge to earnings. Factors that are considered by us in determining whether an other-than-temporary decline in value has occurred include (i) the market value of the security in relation to its cost basis, (ii) the financial condition of the investee, and (iii) our intent and ability to retain the investment for a sufficient period of time to allow for recovery in the market value of the investment.

~~Business Combinations.~~ We account for our business combinations under the acquisition method of accounting. Identifiable assets acquired, liabilities assumed and any noncontrolling interest in the acquiree are recognized and measured as of the acquisition date at fair value. Goodwill is recognized to the extent by which the aggregate of the acquisition-date fair value of the consideration transferred and any noncontrolling interest in the acquiree exceeds the recognized basis of the identifiable assets acquired, net of assumed liabilities. Determining the fair value of assets acquired, liabilities assumed and noncontrolling interest requires management’s judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash flows, discount rates and asset lives among other items.

Recent Accounting Pronouncements

See Note 1 to the accompanying consolidated financial statements for a discussion of recent accounting guidance.

RESULTS OF OPERATIONS

Fiscal ~~2020~~2021 Compared to Fiscal ~~2019~~

2020

Consolidated Results of Operations

The following table sets forth our consolidated results of operations for the fiscal years ended March 31, ~~2020~~2021 and ~~2019:~~2020:

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	Year Ended												Year Ended
	March 31,						Increase (Decrease)						March 31,				Increase (Decrease)
	2020			2019			Amount			Percent			2021		2020		Amount		Percent
	(Amounts in millions)												(Amounts in millions)
Revenues												Revenues
Motion Picture	$	1,670.9		$	1,464.4		$	206.5		14.1	%	Motion Picture	$	1,081.1	$	1,670.9	$	(589.8)	(35.3)	%
Television Production	1,001.3			920.9			80.4			8.7	%	Television Production	831.8		1,001.3		(169.5)		(16.9)	%
Media Networks	1,486.8			1,461.0			25.8			1.8	%	Media Networks	1,562.7		1,486.8		75.9		5.1	%
Intersegment eliminations	(269.0		)	(165.8		)	(103.2		)	62.2	%	Intersegment eliminations	(204.1)		(269.0)		64.9		(24.1)	%
Total revenues	3,890.0			3,680.5			209.5			5.7	%	Total revenues	3,271.5		3,890.0		(618.5)		(15.9)	%
Expenses:												Expenses:
Direct operating	2,226.1			2,028.2			197.9			9.8	%	Direct operating	1,725.9		2,226.1		(500.2)		(22.5)	%
Distribution and marketing	1,008.7			835.5			173.2			20.7	%	Distribution and marketing	719.3		1,008.7		(289.4)		(28.7)	%
General and administration	430.4			445.4			(15.0		)	(3.4	)%	General and administration	486.6		430.4		56.2		13.1	%
Depreciation and amortization	197.7			163.4			34.3			21.0	%	Depreciation and amortization	188.5		197.7		(9.2)		(4.7)	%
Restructuring and other	24.3			78.0			(53.7		)	(68.8	)%	Restructuring and other	24.7		24.3		0.4		1.6	%
Gain on sale of Pantaya												Gain on sale of Pantaya	(44.1)		—		(44.1)		n/a
Total expenses	3,887.2			3,550.5			336.7			9.5	%	Total expenses	3,100.9		3,887.2		(786.3)		(20.2)	%
Operating income	2.8			130.0			(127.2		)	(97.8	)%	Operating income	170.6		2.8		167.8		nm
Interest expense	(191.3		)	(198.9		)	7.6			(3.8	)%	Interest expense	(181.5)		(191.3)		9.8		(5.1)	%
Shareholder litigation settlements	—			(114.1		)	114.1			n/a
Interest and other income	8.8			12.0			(3.2		)	(26.7	)%	Interest and other income	5.8		8.8		(3.0)		(34.1)	%
Other expense	(11.1		)	(4.7		)	(6.4		)	136.2	%	Other expense	(6.7)		(11.1)		4.4		(39.6)	%
Gain (loss) on extinguishment of debt	5.4			(1.9		)	7.3			(384.2	)%
Loss on investments	(0.5		)	(87.6		)	87.1			(99.4	)%
Gain on extinguishment of debt												Gain on extinguishment of debt	—		5.4		(5.4)		(100.0)	%
Gain (loss) on investments												Gain (loss) on investments	0.5		(0.5)		1.0		(200.0)	%
Equity interests loss	(17.2		)	(42.9		)	25.7			(59.9	)%	Equity interests loss	(6.1)		(17.2)		11.1		(64.5)	%
Loss before income taxes	(203.1		)	(308.1		)	105.0			(34.1	)%	Loss before income taxes	(17.4)		(203.1)		185.7		(91.4)	%
Income tax (provision) benefit	(3.3		)	8.5			(11.8		)	(138.8	)%
Income tax provision												Income tax provision	(17.1)		(3.3)		(13.8)		nm
Net loss	(206.4		)	(299.6		)	93.2			(31.1	)%	Net loss	(34.5)		(206.4)		171.9		(83.3)	%
Less: Net loss attributable to noncontrolling interest	18.0			15.4			2.6			16.9	%	Less: Net loss attributable to noncontrolling interest	15.6		18.0		(2.4)		(13.3)	%
Net loss attributable to Lions Gate Entertainment Corp. shareholders	$	(188.4	)	$	(284.2	)	$	95.8		(33.7	)%	Net loss attributable to Lions Gate Entertainment Corp. shareholders	$	(18.9)	$	(188.4)	$	169.5	(90.0)	%

_______________________

nm - Percentage not meaningful.

Revenues. Consolidated revenues ~~increased~~decreased in fiscal ~~2020,~~2021, primarily due to ~~increases~~decreases in Motion Picture and Television Production ~~and to a lesser extent, Media Networks revenues. These increases~~revenues, which were negatively impacted by the COVID-19 global pandemic, partially offset by ~~increases in~~increased Media Networks revenues and lower intersegment eliminations ~~due to higher~~associated with lower Television Production revenues (a substantial portion of intersegment eliminations relates to Television Production revenue) for licenses of original series to Starz Networks and STARZPLAY International, both in the Media Networks segment.

With theaters mostly closed during fiscal 2021 due to circumstances associated with the COVID-19 global pandemic, Motion Picture revenue ~~increased~~decreased primarily due to ~~higher~~lower theatrical, international revenue, and home entertainment packaged media revenue due to fewer theatrical and home entertainment ~~revenue primarily driven by the performance of the films released from our Fiscal 2020 Theatrical Slate, offset partially by~~releases in fiscal 2021, and to a lesser extent, lower television and other revenue.

Television Production revenue decreased due to lower domestic television revenue with decreased intersegment revenues from the licensing of Starz original series and fewer television episodes delivered in fiscal 2021 largely because of the pausing of productions associated with the COVID-19 global pandemic. The decrease in Television Production revenue was also, to a lesser extent, due to lower other revenue. These decreases were partially offset by an increase in home entertainment digital media revenue and international revenue.

The increase in Media Networks revenue ~~increased~~was due to increased revenue across STARZPLAY International, Starz Networks and Other Streaming ~~Services, offset by a slight decrease from Starz Networks.~~Services. See further discussion in the Segment Results of Operations section below.

Table of Contents

Direct Operating Expenses. Direct operating expenses by segment were as follows for the fiscal years ended March 31, ~~2020~~2021 and ~~2019:~~2020:


	Year Ended March 31,																Year Ended March 31,
	2020					2019					Increase (Decrease)						2021				2020				Increase (Decrease)
	Amount			% of Segment Revenues		Amount			% of Segment Revenues		Amount			Percent			Amount		% of Segment Revenues		Amount		% of Segment Revenues		Amount		Percent
	(Amounts in millions)																(Amounts in millions)
Direct operating expenses																Direct operating expenses
Motion Picture	$	810.2		48.5	%	$	758.1		51.8	%	$	52.1		6.9	%	Motion Picture	$	508.3	47.0	%	$	810.2	48.5	%	$	(301.9)	(37.3)	%
Television Production	879.9			87.9		774.5			84.1		105.4			13.6	%	Television Production	676.5		81.3		879.9		87.9		(203.4)		(23.1)	%
Media Networks	680.2			45.7		600.9			41.1		79.3			13.2	%	Media Networks	677.5		43.4		680.2		45.7		(2.7)		(0.4)	%
COVID-19 related costs	46.0			nm		—			nm		46.0			n/a
COVID-19 related charges																COVID-19 related charges	50.6		nm		46.0		nm		4.6		n/a
Other	85.6			nm		54.2			nm		31.4			57.9	%	Other	3.0		nm		85.6		nm		(82.6)		(96.5)	%
Intersegment eliminations	(275.8		)	nm		(159.5		)	nm		(116.3		)	72.9	%	Intersegment eliminations	(190.0)		nm		(275.8)		nm		85.8		(31.1)	%
	$	2,226.1		57.2	%	$	2,028.2		55.1	%	$	197.9		9.8	%		$	1,725.9	52.8	%	$	2,226.1	57.2	%	$	(500.2)	(22.5)	%

_______________________

nm - Percentage not meaningful.

Direct operating expenses ~~increased~~decreased in fiscal ~~2020,~~2021, primarily due to ~~increases from Media Networks and~~lower Motion Picture ~~as well as COVID-19~~and Television Production revenue and lower other direct operating expense related ~~costs, and~~to certain programming and content charges ~~included~~ in ~~"other"~~fiscal 2020 (as further described below), and to a lesser extent, slightly lower Media Networks direct operating expense. These decreases were partially offset by an increase from COVID-19 related charges (as further described below). The ~~increase~~decrease in Television Production direct operating expense ~~were more than~~was partially offset by the ~~increase~~decrease in intersegment eliminations, which primarily relate to Television Production direct operating costs associated with licenses of original series to Starz Networks and STARZPLAY International, both in the Media Networks segment. The decrease from Media Networks ~~direct operating expense increased~~was due to ~~higher~~lower programming amortization at STARZPLAY International, which was partially offset by ~~lower direct operating expense~~a benefit at Starz Networks ~~which included a benefit~~in fiscal 2020 of $39.7 million associated with the modification of a content licensing arrangement, net of amortization for related changes in content availability and air dates. ~~Motion Picture direct operating expense increased due to increased Motion Picture revenue and higher investment-in-film write-downs.~~ See further discussion in the Segment Results of Operations section below.

COVID-19 Related ~~Costs.~~Charges. ~~As a direct result of~~In connection with the disruptions associated with the COVID-19 global pandemic and measures to prevent its spread and mitigate its effects both domestically and internationally, and the related economic disruption, during ~~the fourth quarter of~~fiscal 2021 and fiscal 2020, we ~~have~~ incurred $50.6 million and $46.0 million in incremental costs which were expensed in the ~~period, reflected~~periods which are included in consolidated direct operating expense and are excluded from segment direct operating expense. These costs include ~~certain motion picture and television impairments and development charges~~incremental costs associated with film impairment due to changes in performance expectations, ~~or the feasibility of completing the project, and costs associated with~~ the pausing and restarting of productions including certain cast and crew, idle facilities and equipment costs ~~and incremental costs~~resulting from circumstances associated with ~~bad debt reserves.~~the COVID-19 global pandemic. We expect to incur additional incremental costs in future periods. ~~A majority of these~~If the adverse economic impact and disruptions associated with the COVID-19 global pandemic continue to improve, we expect that the incremental costs ~~relate~~we incur in future periods will decrease as compared to ~~our Motion Picture segment.~~fiscal 2021. We are in the process of seeking insurance recovery for some of these costs, which cannot be estimated at this time, and therefore no material amounts of insurance proceeds have ~~not~~ been recorded in our consolidated financial statements.

Other. During fiscal 2020, ~~and 2019,~~ in connection with ~~recent~~ management changes, we implemented changes to our programming and broadcasting strategy including programming acquired or produced under prior management. As a result, we recorded certain programming and content charges of $76.5 million ~~and $35.1 million~~ in fiscal 2020, ~~and 2019, respectively,~~ which are excluded from segment operating results but included in direct operating expense in the consolidated statement of operations and reflected in the "other" line item above. In addition, "other" direct operating expenses in the table above includes the amortization of the non-cash fair value adjustments on film and television assets associated with the application of purchase accounting related to recent acquisitions.

Distribution and Marketing Expenses. Distribution and marketing expenses by segment were as follows for the fiscal years ended March 31, ~~2020~~2021 and ~~2019:~~2020:

Year Ended
March 31, Increase (Decrease)
2020 2019 Amount Percent
(Amounts in millions)
Television Production Segment:
Revenue $ 1,001.3
$ 920.9
$ 80.4
8.7 %
Expenses:
Direct operating expense 879.9
774.5
105.4
13.6 %
Distribution & marketing expense 30.7
36.8
(6.1 ) (16.6 )%
Gross contribution 90.7
109.6
(18.9 ) (17.2 )%
General and administrative expenses 37.3
43.5
(6.2 ) (14.3 )%
Segment profit $ 53.4
$ 66.1
$ (12.7 ) (19.2 )%

Direct operating expense as a percentage of revenue 87.9 % 84.1 %

Gross contribution as a percentage of revenue 9.1 % 11.9 %

Table of Contents

Revenue. The table below sets forth Television Production revenue and ~~the~~ changes in revenue by media for the fiscal years ended March 31, ~~2020~~2021 and ~~2019:~~2020:


	Year Ended
	March 31,				Increase (Decrease)
	2021		2020		Amount		Percent
Television Production	(Amounts in millions)
Television	$	474.0	$	715.7	$	(241.7)	(33.8)	%
International	164.5		152.7		11.8		7.7	%
Home Entertainment Revenue
Digital	127.1		57.4		69.7		121.4	%
Packaged Media	5.7		3.4		2.3		67.6	%
Total Home Entertainment Revenue	132.8		60.8		72.0		118.4	%
Other	60.5		72.1		(11.6)		(16.1)	%
	$	831.8	$	1,001.3	$	(169.5)	(16.9)	%

Year Ended
March 31, Increase (Decrease)
2020 2019 Amount Percent
Television Production (Amounts in millions)
Television $ 715.7
$ 655.8
$ 59.9
9.1 %
International 152.7
136.0
16.7
12.3 %
Home Entertainment Revenue
Digital 57.4
66.9
(9.5 ) (14.2 )%
Packaged Media 3.4
7.6
(4.2 ) (55.3 )%
Total Home Entertainment Revenue 60.8
74.5
(13.7 ) (18.4 )%
Other 72.1
54.6
17.5
32.1 %
$ 1,001.3
$ 920.9
$ 80.4
8.7 %

The primary component of Television Production revenue is domestic television revenue. Domestic television revenue ~~increased~~decreased in fiscal ~~2020~~2021 as compared to fiscal ~~2019,~~2020, due to ~~an increase in syndicated licensing revenue, and increased~~decreased intersegment revenues from the licensing of Starz original ~~series. These increases were offset partially by decreased~~series (fiscal 2020 included significant revenue fromPower Season 6), fewer television episodes delivered, and decreased ~~license fees~~revenue from ~~unscripted~~reality television ~~programs~~series, all of which were negatively impacted by disruptions associated with the COVID-19 global pandemic and the associated pausing of productions which resulted in the delay of television episodes delivered in fiscal 2021. In addition, fiscal 2020 ~~as compared to fiscal 2019.~~included significant revenue from Ambitions and House of Payne.

International revenue in fiscal ~~2020~~2021 increased ~~$16.7~~$11.8 million, or ~~12.3%~~7.7%, as compared to fiscal ~~2019~~2020,~~primarily~~ due to ~~revenue from~~ ~~Mythic Quest: Raven's Banquet~~ ~~Season 1,~~ ~~Orange Is the New Black~~ ~~Season 7,~~ ~~Dear White People~~ ~~Season 3, and~~ ~~Greenleaf~~ ~~Season 4, and~~increased intersegment ~~revenue~~revenues from STARZPLAY International from the licensing of Starz original series, ~~The Rook~~ ~~Season 1,~~and in particular, Power ~~Season 6,~~ ~~Vida~~ ~~Season 2, and~~ ~~The Spanish Princess~~ ~~Season 1 in fiscal 2020. This compared to revenue in fiscal 2019 from~~ ~~Orange Is the New Black~~ ~~Seasons 6 & 7,~~ ~~Step Up: High Water~~ ~~Season 2,~~ ~~Greenleaf~~ ~~Season 3,~~ ~~Ash vs. Evil Dead~~ ~~Season 3, and~~ ~~Power~~ ~~Season 5.~~ Book II: Ghost.

Home entertainment revenue in fiscal ~~2020 decreased $13.7~~2021 increased $72.0 million, or ~~18.4%~~118.4%, as compared to fiscal ~~2019~~2020,~~primarily~~ driven by ~~decreases from~~ digital media revenue in fiscal ~~2019~~2021 for the second syndication license of Mad Men Seasons 1 - 7, and digital media revenue for ~~The Royals,~~ ~~and the Starz original series,~~ ~~The Missing~~ ~~Season 2 and~~ ~~Black Sails~~Power Season ~~4, which were~~6, partially offset by ~~increased~~ digital media revenue in fiscal 2020 for ~~Are We There Yet~~Power. Season 5.

Other revenue ~~increased~~decreased in fiscal ~~2020~~2021 as compared to fiscal ~~2019 due to a full year of revenue in fiscal 2020 from 3 Arts Entertainment, which compared to revenue in fiscal 2019 from the acquisition date of May 29, 2018 to March 31, 2019.~~2020. Revenue of 3 Arts Entertainment was negatively impacted ~~by a small amount~~ in ~~our~~ fiscal ~~year ended March 31, 2020~~2021 as a result of the COVID-19 global pandemic ~~and will be more significantly impacted in the fiscal year ended March 31, 2021,~~related disruptions.While television production has mostly resumed, the extent of ~~which~~the future impact on other revenue of the COVID-19 global pandemic is uncertain and will depend on ~~when~~ film and television productions and releases ~~return~~fully returning to and remaining at pre COVID-19 levels.

If the adverse economic impact and disruptions associated with the COVID-19 global pandemic continue to improve, we currently expect that Television Production segment revenues will increase in fiscal 2022 as compared to fiscal 2021. The extent of the ~~impact of the COVID-19 global pandemic on~~increase, if any, to Television Production segment revenues, will depend on, among other things, ~~the duration and spread of the pandemic,~~ the impact of governmental regulations that have been, and may continue to be, imposed in response to the pandemic, the continued effectiveness of actions taken to contain or mitigate the outbreak (including the availability, effectiveness and/or public acceptance of any FDA-approved COVID-19 vaccines), potential resurgences of COVID-19 in certain parts of the world, and the discovery of new variants of the virus which could result in the re-imposition of certain restrictions and may lead to more restrictions being implemented again to reduce the spread of COVID-19, and general global economic conditions. The evolving and uncertain nature of the situation could result in further interruptions to our operations, including delays in domestic and international distribution and production throughout the U.S., Canada and worldwide, and the pausing of productions, which could impact Television Production segment revenues.

Direct Operating Expense. Direct operating expense of the Television Production segment in fiscal ~~2020 increased $105.4~~2021 decreased $203.4 million, or ~~13.6%~~23.1%, due to the ~~increase~~decrease in Television Production revenues. Direct operating expenses as a percentage of television production revenue ~~increased primarily~~decreased due to the mix of titles generating revenue in fiscal ~~2020~~2021 as compared to fiscal ~~2019.~~2020. In particular, fiscal ~~2019~~2021 included significant revenue from Mad Men, which has a lower amortization rate relative to the amortization rate of the Television Production segment, and due to the COVID-19 global pandemic related disruptions, fiscal 2021 included fewer deliveries of newer shows in which direct operating expense is typically higher ~~margin television series, such~~ as ~~Orange Is The New Black~~ ~~and~~ ~~Step Up: High Water~~ ~~as compared to fiscal 2020 which included new television programs~~ ~~(Manhunt, Zoey's Extraordinary Playlist, Mythic Quest: Raven's Banquet, Kevin Hart: Don't F**k This Up, The Rook, Ambitions), which typically result in higher amortization expenses in relation to revenues initially.~~a percentage of revenue.

Gross Contribution. Gross contribution of the Television Production segment for fiscal ~~2020 decreased~~2021 increased as compared to fiscal ~~2019 even though revenues increased,~~2020, due to ~~higher~~lower direct operating expenses as a percentage of television production revenue, partially offset by lower ~~distribution and marketing expense.~~television production revenue.

Table of Contents

General and Administrative Expense. General and administrative expenses of the Television Production segment ~~decreased $6.2~~increased $5.4 million, or ~~14.3%~~14.5%, ~~primarily~~ due to an increase in incentive compensation partially offset by decreases in ~~salaries~~travel and related ~~expenses, incentive compensation and professional fees. Fiscal 2019 includes general and administrative expenses of 3 Arts Entertainment from the acquisition date of May 29, 2018.~~expenses.

Media Networks

The table below sets forth Media Networks gross contribution and segment profit for the fiscal years ended March 31, ~~2020~~2021 and ~~2019~~:2020:


	Year Ended
	March 31,						Increase (Decrease)
	2021			2020			Amount		Percent
	(Amounts in millions)
Media Networks Segment:
Revenue	$	1,562.7		$	1,486.8		$	75.9	5.1	%
Expenses:
Direct operating expense	677.5			680.2			(2.7)		(0.4)	%
Distribution & marketing expense	501.8			426.1			75.7		17.8	%
Gross contribution	383.4			380.5			2.9		0.8	%
General and administrative expenses	93.9			87.5			6.4		7.3	%
Segment profit	$	289.5		$	293.0		$	(3.5)	(1.2)	%

Direct operating expense as a percentage of revenue	43.4		%	45.7		%

Gross contribution as a percentage of revenue	24.5		%	25.6		%

Year Ended
March 31, Increase (Decrease)
2020 2019 Amount Percent
(Amounts in millions)
Media Networks Segment:
Revenue $ 1,486.8
$ 1,461.0
$ 25.8
1.8 %
Expenses:
Direct operating expense 680.2
600.9
79.3
13.2 %
Distribution & marketing expense 426.1
326.1
100.0
30.7 %
Gross contribution 380.5
534.0
(153.5 ) (28.7 )%
General and administrative expenses 87.5
97.7
(10.2 ) (10.4 )%
Segment profit $ 293.0
$ 436.3
$ (143.3 ) (32.8 )%

Direct operating expense as a percentage of revenue 45.7 % 41.1 %

Gross contribution as a percentage of revenue 25.6 % 36.6 %

The following table sets forth the Media Networks segment profit by product ~~line:~~line. Our majority interest in Pantaya (reflected in and representing substantially all of Other Streaming Services) was sold on March 31, 2021, see Note 2 to our consolidated financial statements for further information.


	Year Ended								Year Ended
	March 31, 2021								March 31, 2020
	Starz Networks		STARZPLAY International		Other Streaming Services		Total Media Networks		Starz Networks		STARZPLAY International		Other Streaming Services		Total Media Networks
	(Amounts in millions)
Media Networks Segment:
Revenue	$	1,446.9	$	65.5	$	50.3	$	1,562.7	$	1,430.1	$	22.9	$	33.8	$	1,486.8
Expenses:
Direct operating expense	576.7		89.0		11.8		677.5		554.3		120.1		5.8		680.2
Distribution & marketing expense	363.8		98.2		39.8		501.8		346.9		42.4		36.8		426.1
Gross contribution	506.4		(121.7)		(1.3)		383.4		528.9		(139.6)		(8.8)		380.5
General and administrative expenses	68.0		18.3		7.6		93.9		66.1		15.0		6.4		87.5
Segment profit	$	438.4	$	(140.0)	$	(8.9)	$	289.5	$	462.8	$	(154.6)	$	(15.2)	$	293.0

Year Ended Year Ended
March 31, 2020 March 31, 2019
Starz Networks STARZPLAY International Other Streaming Services Total Media Networks Starz Networks STARZPLAY International Other Streaming Services Total Media Networks
(Amounts in millions)
Media Networks Segment:
Revenue $ 1,430.1
$ 22.9
$ 33.8
$ 1,486.8
$ 1,440.9
$ 2.1
$ 18.0
$ 1,461.0
Expenses:
Direct operating expense 554.3
120.1
5.8
680.2
563.7
30.1
7.1
600.9
Distribution & marketing expense 346.9
42.4
36.8
426.1
303.1
5.2
17.8
326.1
Gross contribution 528.9
(139.6 ) (8.8 ) 380.5
574.1
(33.2 ) (6.9 ) 534.0
General and administrative expenses 66.1
15.0
6.4
87.5
86.1
7.2
4.4
97.7
Segment profit $ 462.8
$ (154.6 ) $ (15.2 ) $ 293.0
$ 488.0
$ (40.4 ) $ (11.3 ) $ 436.3

Table of Contents

Subscriber Data. The number of period-end service subscribers is a key metric to evaluate a non-ad supported subscription video service as a growing or decreasing subscriber base is a key indicator of the health of the overall business. Service subscribers may impact revenue differently depending on specific distribution agreements we have with our distributors which may include fixed fees, rates per basic video household or a rate per STARZ subscriber. The table below sets forth, for the periods presented, subscriptions to our Media Networks and STARZPLAY Arabia services.



	March 31,	March 31,
	2021	2020
	(Amounts in millions)
Starz Domestic
Linear Subscribers	10.9	12.1
OTT Subscribers	10.0	6.8
Total	20.9	18.9
STARZPLAY International
Linear Subscribers	1.9	1.9
OTT Subscribers	4.9	1.3
Total	6.8	3.2
Total Starz
Linear Subscribers	12.8	14.0
OTT Subscribers	14.9	8.1
Total Starz	27.7	22.1


STARZPLAY Arabia(1)	1.8	1.8
Total Domestic and International Subscribers(2)	29.5	23.9

Subscribers by Platform:
Linear Subscribers	12.8	14.0
OTT Subscribers(2)(3)	16.7	9.9
Total Global Subscribers(2)	29.5	23.9

~~The pro forma subscriber data as~~___________________

(1)Represents subscribers of STARZPLAY Arabia, a non-consolidated equity method investee.

(2)Due to the March 31, ~~2019 reflects the number~~2021 sale of Pantaya, total domestic and international subscribers, ~~as of March 31, 2019,~~OTT subscribers and total global subscribers amounts have been adjusted ~~to remove the estimated number of subscribers to MVPD video packages or MVPD bundles that include the Starz service~~from amounts previously reported for ~~distributors who dropped or removed Starz from these highly distributed MVPD video packages or MVPD bundles. This is a key metric to show prior period subscribers on a comparable basis to~~ March 31, 2020 ~~quarter-end subscribers. An MVPD video package is an offering by our distributors~~ to ~~its customers~~exclude Pantaya in order to be consistent with the presentation at March 31, 2021. Subscribers of ~~multiple distinct video networks or services for a single recurring price where there is no distinction~~Pantaya (all OTT) at March 31, 2021 and March 31, 2020 amounted to 0.9 million and 0.7 million, respectively.

(3)OTT subscribers includes subscribers of ~~price on any one specific network. An MVPD bundle is an offering by our distributors to its customers of two or more distinct MVPD services, such~~STARZPLAY Arabia, as ~~video, internet and phone, sold on a subscription basis to a consumer or subscriber for a single price, and may include additional premium channels, like STARZ, to promote the bundle offering.~~ presented above.

Pro Forma
March 31, March 31, March 31,
2020 2019 2019
(Amounts in millions)
Domestic Subscribers
STARZ 18.9
24.7
16.8
Other Streaming Services⁽¹⁾
0.7
0.3
0.3
19.6
25.0
17.1
International Subscribers
STARZPLAY International 3.2
2.0
2.0
STARZPLAY Arabia⁽²⁾
1.8
1.1
1.1
5.0
3.1
3.1
Total Domestic and International Subscribers 24.6
28.1
20.2

Subscribers by Platform:
Linear Subscribers 14.0
22.6
14.7
OTT Subscribers⁽³⁾
10.6
5.5
5.5
Total Global Subscribers 24.6
28.1
20.2

~~___________________~~


~~(1)~~	~~Represents subscribers of our premium Spanish-language streaming service, Pantaya, which was launched in the quarter ended September 30, 2017.~~


~~(2)~~	~~Represents subscribers of STARZPLAY Arabia, a non-consolidated equity method investee.~~


~~(3)~~	~~OTT subscribers includes subscribers of STARZPLAY Arabia, as presented above.~~

Revenue. The increase in Media Networks' revenue was driven by higher STARZPLAY International revenue of ~~$20.8~~$42.6 million, increased Starz Networks' revenue of $16.8 million and increased Other Streaming Services revenue of ~~$15.8 million, partially offset by decreased Starz Networks' revenue of $10.8~~$16.5 million. STARZPLAY International revenue increased as a result of subscriber and revenue growth in the international territories previously launched, ~~in fiscal 2019,~~ and additional territories launched since March 31, ~~2019. Other Streaming Services revenue increased due to subscriber growth.~~2020. Starz Networks' revenue ~~decreased~~increased as a result of higher OTT revenue resulting from increased subscriptions, partially offset by declines in revenue from traditional linear ~~services, which~~services. Our majority interest in Pantaya (reflected in and representing substantially all of Other Streaming Services) was ~~mostly offset by higher OTT revenue resulting from increased subscriptions.~~sold on March 31, 2021, see Note 2 to our consolidated financial statements for further information.

As a result of events related to the COVID-19 global pandemic, television and streaming consumption around the globe ~~has~~ increased, ~~and~~as well as home entertainment ~~demand continues. For instance,~~demand. STARZ ~~has~~ experienced an increase in viewership of its content across all platforms as well as an increase in subscribers to its OTT services, both domestically and internationally. This increase in subscribers is dependent upon future economic conditions, our ability to deliver original content and may vary due to changes in consumer viewing and subscription ~~patterns, such as declining linear subscribers and increasing subscribers~~patterns. However, it is too early to ~~OTT services. This~~say whether this increase ~~may not be~~is indicative of future results and whether growth may slow as governmental and other restrictions are relaxed, and as a result of the current and possible longer term negative economic impact of the pandemic.

Table of Contents

During fiscal ~~2020~~2021 and fiscal ~~2019,~~2020, the following original series premiered on STARZ:



Year Ended March 31, 2021				Year Ended March 31, 2020	~~Year Ended March 31, 2019~~
First Quarter:				First Quarter:
Vida Season 3				The Spanish Princess	~~Howard's End~~
Hightown Season 1				Vida Season 2
		~~Sweetbitter~~ ~~Season 1~~
The Rook Season 1
Second Quarter:				Second Quarter:
~~Vida~~P-Valley Season 1
			~~Wrong Man~~ ~~Season 1~~
~~Second Quarter:~~	~~Second Quarter:~~
Sweetbitter Season 2
		Power Book II: Ghost~~Season 5~~
		Power Season 6A
		~~America to Me~~
Power Confidential Season 1
Third Quarter:*		~~Warriors of Liberty City~~		Third Quarter:
~~Third Quarter:~~Seduced: Inside the NXIVM Cult				~~Third Quarter:~~Dublin Murders
~~Dublin Murders~~			~~Outlander~~ The Spanish Princess~~Season 4~~
~~Leavenworth~~	~~Counterpart~~ Season 2			Leavenworth
Fourth Quarter:				Fourth Quarter:
American Gods Season 3				Power Season 6B
Min in Kilts		~~American Gods~~ ~~Season 2~~
Wrong Man Season 2
The Gloaming		~~Now Apocalypse~~ ~~Season 1~~
Outlander Season 5

*In addition, while Power Book II: Ghost premiered in the second quarter ended September 30, 2020, the series returned with a mid-season premiere in the third quarter in December 2020.

Direct Operating and Distribution and Marketing Expenses. Direct operating and distribution and marketing expenses primarily represent programming cost amortization and advertising and marketing costs, respectively. The level of ~~programing~~programming cost amortization and advertising and marketing costs and thus the gross contribution margin for the Media Networks' segment can fluctuate from period to period depending on the number of new original series and first-run output theatrical movies premiering on the network during the period. Programming cost amortization and advertising and marketing costs generally increase in periods where new original series premiere. In addition, the launch of the STARZPLAY international service has and will continue to result in an increase in expenses as the service continues to expand.

The ~~increase~~decrease in Media Networks direct operating expenses is due to ~~higher~~lower direct operating expenses at STARZPLAY International, ~~which were partially~~ offset by ~~lower~~increases at Starz ~~Networks' direct operating expenses~~Networks and, to a lesser extent, Other Streaming Services in fiscal ~~2020.~~2021. Direct operating expenses at STARZPLAY International ~~increased~~decreased as a result of ~~higher~~write downs of programming costs during fiscal 2020 and prior periods, which reduced the programming cost ~~amortization related to~~basis being amortized in fiscal 2021, partially offset by the ~~launch and operation~~continued expansion of STARZPLAY International. The increase in ~~additional international territories since March 31, 2019. The decrease in~~Starz Networks direct operating expense ~~at Starz Networks~~ was due to a benefit in fiscal 2020 of $39.7 million associated with the modification of a content licensing arrangement, net of amortization for related changes in content availability and air dates, and ~~lower programming amortization related to our Starz Originals. This benefit was partially offset by~~ higher programming amortization related to theatrical releases under our programming output agreement ~~and higher development expense~~with Sony, partially offset by lower programming cost amortization related to our Starz ~~Originals.~~Originals due to fewer series premieres and lower development expense.

The increase in Media Networks distribution and marketing expense is due to increases at Starz Networks, STARZPLAY International, and to a lesser extent, Other Streaming Services. Starz Networks' distribution and marketing expense increased due to increased operating costs associated with increased OTT revenue and increased marketing spend. Distribution and marketing expense for STARZPLAY International increased dueprimarily to an increase inat STARZPLAY International from increased advertising and marketing costs in order to drive subscriber growth in the international territories previously launched, ~~in fiscal 2019,~~ and additional territories launched since March 31, ~~2019. The increase in~~2020. In addition, Starz Networks distribution and marketing expense ~~for Other Streaming Services was primarily attributable~~increased due to an increase in operating expense related to continued growth in the OTT service and increased advertising and marketing ~~costs in order~~ to drive subscriber growth.

Gross Contribution. Gross contribution of the Media Networks segment for fiscal 2020 was primarily from Starz Networks, offset partially by negative contributions from STARZPLAY International which has continued to expand in additional territories, and to a lesser extent, negative contribution from Other Streaming Services. The ~~decrease~~increase in gross contribution compared to fiscal ~~2019~~2020 was ~~primarily~~ due to ~~higher~~lower negative contributions from STARZPLAY International and ~~lower gross contribution from~~Other Streaming Services, partially offset by a decrease at Starz Networks driven by ~~increased distribution and marketing expense.~~the benefit in direct operating expense in fiscal 2020 as discussed above.

General and Administrative Expense. General and administrative expenses of the Media Networks segment in fiscal ~~2020 decreased~~2021 increased from fiscal ~~2019,~~2020, driven by ~~a decrease in~~slight increases across STARZPLAY International, Starz Networks ~~partially offset by increased general~~ and ~~administrative expenses for STARZPLAY International. The decrease in Starz Networks resulted from a decrease in payroll and related costs.~~Other Streaming Services.

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Liquidity and Capital Resources

Sources and Uses of Cash

Our liquidity and capital resources have been provided principally through cash generated from operations, corporate debt, our production loans, the monetization of trade accounts receivable and our ~~production loans.~~Production Tax Credit Facility (as defined and further described below). As of March 31, ~~2020,~~2021, we had cash and cash equivalents of ~~$318.2~~$528.7 million. Our debt at March 31, ~~2020~~2021 primarily consisted of a $1.5 billion five-year revolving credit facility (with no amounts outstanding at March 31, ~~2020)~~2021) due March 2023 (the "Revolving Credit Facility"), a five-year term loan A facility due March 2023 (the "Term Loan A"), a seven-year term loan B facility due March 2025 (the "Term Loan B", and, together with the Revolving Credit Facility and the Term Loan A, the "Senior Credit Facilities"), 5.875% senior notes due 2024 (the "5.875% Senior Notes"), and 6.375% senior notes due 2024 (the "6.375% Senior Notes"). See below for our refinancing and debt transaction activities subsequent to March 31, 2021.

In addition, in January 2021, as amended on March 31, 2021, we entered into a non-recourse senior secured revolving credit facility (the "Production Tax Credit Facility") based on collateral consisting of certain of the Company’s tax credit receivables. The maximum principal amount of the Production Tax Credit Facility is $220.0 million, subject to the amount of collateral available, which is based on specified percentages of amounts payable to the Company by governmental authorities pursuant to the tax incentive laws of certain eligible jurisdictions that arise from the production or exploitation of motion pictures and television programming in such jurisdiction. Advances under the Production Tax Credit Facility bear interest at a rate equal to, at our option, LIBOR plus 1.50% per annum or the base rate plus 0.50% per annum. The Production Tax Credit Facility matures on January 27, 2025.As of March 31, 2021, the Company had $120.0 million outstanding under the Production Tax Credit Facility, and there was $79.2 million available under the Production Tax Credit Facility.

Subsequent to March 31, 2021, we completed the following debt transactions:

Senior Notes Redemption and Issuance. On April 1, 2021, we redeemed in full the $518.7 million outstanding principal amount of the 5.875% Senior Notes due November 2024 and the $545.6 million outstanding principal amount of the 6.375% Senior Notes due February 2024. In connection with the early redemption of the 5.875% Senior Notes and the 6.375% Senior Notes, we paid a prepayment premium of $15.2 million and $17.4 million, respectively, plus accrued and unpaid interest to the date of redemption, pursuant to the terms of the indentures governing the 5.875% Senior Notes and the 6.375% Senior Notes, respectively.

In connection with the redemption of the 5.875% Senior Notes and the 6.375% Senior Notes, on April 1, 2021, we issued $1.0 billion aggregate principal amount of 5.500% Senior Notes due April 15, 2029.

Credit Agreement Amendment. On April 6, 2021, we amended our Credit Agreement to, among other things, extend the maturity (the "Extension") of a portion of its revolving credit commitments, amounting to $1.25 billion, and a portion of its outstanding term A loans, amounting to $444.9 million, to April 6, 2026 (the "2026 Term Loan A"), and make certain other changes to the covenants and other provisions therein. After giving effect to the Extension, $250.00 million of revolving credit commitments and $215.1 million of term A loans remained outstanding with a maturity of March 22, 2023 (the "2023 Term Loan A").

The 2026 Term Loan A requires mandatory quarterly principal payments beginning September 30, 2022 at a quarterly rate of 1.25%, then at quarterly rates of 1.75% beginning September 30, 2023, and 2.50% beginning September 30, 2024 through March 31, 2026, with the balance payable at maturity. The 2023 Term Loan A will continue to require mandatory quarterly principal payments under the original repayment schedule, at quarterly rates of 2.50% beginning June 30, 2021, with the balance payable at maturity.

Term Loan B Repurchases. In April and May 2021, we completed a series of repurchases of the Term Loan B and, in aggregate, paid $60.1 million to repurchase $60.5 million principal amount of the Term Loan B.

See Note 22 to our consolidated financial statements for further information.

Our principal uses of cash in operations include the funding of film and television productions, film and programming rights acquisitions, and the distribution and marketing of films and television programs. We also use cash for debt service (i.e. principal and interest payments) requirements, equity method or other equity investments, quarterly cash dividends, the purchase of common shares under our share repurchase program, capital expenditures, and acquisitions of businesses.

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In addition, the Company has a redeemable noncontrolling interest balance of ~~$167.8~~$219.1 million as of March 31, 2021 related to its acquisition of a controlling interest in Pilgrim Media Group and 3 Arts Entertainment, which may require the use of cash in the event the holders of the noncontrolling interests require the Company to repurchase their interests (see Note 12 to our consolidated financial statements).

We may from time to time seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity securities, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Anticipated Cash Requirements. The nature of our business is such that significant initial expenditures are required to produce, acquire, distribute and market films and television programs, while revenues from these films and television programs are earned over an extended period of time after their completion or acquisition. In addition, the launch of the Company's STARZPLAY international service has and will require capital investment as the service expands to other international territories.

In the short-term, while a portion of our revenue has been reduced as a result of disruptions associated with the COVID-19 global pandemic, our cash requirements for productions and marketing spends have also been reduced. As previously discussed, in some areas we have experienced increases in revenue and viewership of our content. We expect that the ultimate impact of these disruptions, including the extent of any adverse impact on our business, results of operations and financial condition, will depend on, among other things, the duration and spread of the pandemic, the impact of governmental regulations that have been, and may continue to be, imposed in response to the pandemic, the effectiveness of actions taken to contain or mitigate the outbreak, and global economic conditions. As a result,While we cannot predict the outcome of the ~~full extent of~~disruptions associated with the COVID-19 global pandemic on our operating results, cash flows and financial ~~position.~~position, we currently expect that as production activity increases and theaters begin to reopen, our cash requirements for productions and marketing spends will increase in fiscal 2022 as compared to fiscal 2021.

However, we currently believe that cash flow from operations, cash on hand, revolving credit facility availability, the monetization of trade accounts receivable, tax-efficient financing, the availability of our Production Tax Credit Facility, and available production financing will be adequate to meet known operational cash and debt service (i.e. principal and interest payments) requirements for the foreseeable future, including the funding of future film and television production, film and programming rights acquisitions and theatrical and home entertainment release schedules, and future equity method or other investment funding requirements, and ~~international expansion. However, we may seek alternative sources of capital in connection with the STARZPLAY~~ international expansion. We monitor our cash flow liquidity, availability, fixed charge coverage, capital base, film spending and leverage ratios with the long-term goal of maintaining our credit worthiness.

Our current financing strategy is to fund operations and to leverage investment in films and television programs through our cash flow from operations, our revolving credit facility, single-purpose production financing, government incentive programs, film funds, distribution commitments, ~~and~~ the monetization of trade accounts ~~receivable.~~receivable, and our Production Tax Credit Facility. In addition, we continue to expand our STARZPLAY international service and may acquire businesses or assets, including individual films or libraries that are complementary to our business. Any such transaction could be financed through our cash flow from operations, credit facilities, equity or debt financing. If additional financing beyond our existing cash flows from operations and credit facilities cannot fund such transactions, there is no assurance that such financing will be available on terms acceptable to us. Our ability to obtain any additional financing will depend on, among other things, our business plans, operating performance and the condition of the capital markets at the time we seek financing. Additionally, circumstances related to the COVID-19 global pandemic has caused disruption in the capital markets, which could make financing more difficult and/or expensive, and we may not be able to

obtain such financing. We may also dispose of businesses or assets, including individual films or libraries, and use the net proceeds from such dispositions to fund operations or such acquisitions, or to repay debt.

Covenants. The Senior Credit Facilities contain representations and warranties, events of default and affirmative and negative covenants that are customary for similar financings and which include, among other things and subject to certain significant exceptions, restrictions on the ability to declare or pay dividends, create liens, incur additional indebtedness, make investments, dispose of assets and merge or consolidate with any other person. In addition, a net first lien leverage maintenance covenant and an interest coverage ratio maintenance covenant apply to the Revolving Credit Facility and the Term Loan A and are tested quarterly. As of March 31, ~~2020,~~2021, the Company was in compliance with all applicable covenants.

The 5.875% Senior Notes and 6.375% Senior Notes contain certain restrictions and covenants that, subject to certain exceptions, limit the Company’s ability to incur additional indebtedness, pay dividends or repurchase the Company’s common shares, make certain loans or investments, and sell or otherwise dispose of certain assets subject to certain conditions, among other limitations. As of March 31, ~~2020,~~2021, the Company was in compliance with all applicable covenants.

Share Repurchase Plan. On February 2, 2016, our Board of Directors authorized to increase our previously announced share repurchase plan from $300 million to $468 million. To date, ~~including repurchases subsequent to March 31, 2020 of approximately $1.0 million,~~ approximately $288.1 million of our common shares have been purchased under the plan, leaving approximately $179.9 million of authorized potential ~~purchases.~~repurchases. The remaining $179.9 million of our common shares authorized under the plan may be purchased from time to time at our discretion, including

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quantity, timing and price thereof, and will be subject to market conditions. Such purchases will be structured as permitted by securities laws and other legal requirements. During the fiscal year ended March 31, ~~2020, we~~2021, the Company repurchased ~~0.7~~0.2 million of ~~our~~its Class A voting shares for an aggregate cost of ~~$3.8~~$1.0 million, with ~~a weighted~~an average repurchase price per share of ~~$5.43.~~$5.75.

Dividends. The amount of dividends, if any, that we pay to our shareholders is determined by our Board of Directors, at its discretion, and is dependent on a number of factors, including our financial position, results of operations, cash flows, capital requirements and restrictions under our credit agreements, and shall be in compliance with applicable law. In November 2018, our Board of Directors suspended our quarterly cash dividend to focus on driving long-term shareholder value by investing in global growth opportunities for Starz, while also strengthening the Company's balance sheet.

Capacity to Pay Dividends. At March 31, ~~2020,~~2021, the capacity to pay dividends under the Senior Credit Facilities and the 5.875% Senior Notes and 6.375% Senior Notes significantly exceeded the amount of the Company's accumulated deficit or net loss, and therefore the Company's net loss of ~~$206.4~~$34.5 million and accumulated deficit of ~~$16.9~~$82.9 million were deemed free of restrictions from paying dividends at March 31, ~~2020.~~2021.

Discussion of Operating, Investing, Financing Cash Flows

Cash and cash equivalents increased by $206.3 million for the fiscal year ended March 31, 2021 and increased by $136.8 million for the fiscal year ended March 31, 2020, ~~and decreased by $193.5 million for the fiscal year ended March 31, 2019,~~ before foreign exchange effects on cash. Components of these changes are discussed below in more detail.

Operating Activities. Cash flows provided by (used in) operating activities for the fiscal years ended March 31, ~~2020~~2021 and ~~2019~~2020 were as follows:

Year Ended March 31,
2020 2019 Net Change
(Amounts in millions)
Operating Activities:
Operating income $ 2.8
$ 130.0
$ (127.2 )
Amortization of films and television programs and program rights 1,706.7
1,516.5
190.2
Non-cash share-based compensation 50.5
68.1
(17.6 )
Cash interest (176.4 ) (152.0 ) (24.4 )
Current income tax provision (4.2 ) (15.1 ) 10.9
Shareholder litigation settlement charges and interest —
(221.3 ) 221.3
Other non-cash charges included in operating activities 263.9
201.5
62.4
Cash flows from operations before changes in operating assets and liabilities 1,843.3
1,527.7
315.6

Changes in operating assets and liabilities:
Accounts receivable, net and other assets 397.5
470.8
(73.3 )
Investment in films and television programs and program rights (1,545.3 ) (1,469.9 ) (75.4 )
Other changes in operating assets and liabilities (80.9 ) (101.1 ) 20.2
Changes in operating assets and liabilities (1,228.7 ) (1,100.2 ) (128.5 )
Net Cash Flows Provided By Operating Activities $ 614.6
$ 427.5
$ 187.1


	Year Ended March 31,
	2021		2020		Net Change
	(Amounts in millions)
Operating Activities:
Operating income	$	170.6	$	2.8	$	167.8
Depreciation and amortization	188.5		197.7		(9.2)
Amortization of films and television programs and program rights	1,189.8		1,706.7		(516.9)
Non-cash share-based compensation	89.0		50.5		38.5
Gain on sale of Pantaya	(44.1)		—		(44.1)
Cash interest	(136.7)		(176.4)		39.7
Current income tax provision	(13.7)		(4.2)		(9.5)
Other non-cash charges included in operating activities	72.3		66.2		6.1
Cash flows from operations before changes in operating assets and liabilities	1,515.7		1,843.3		(327.6)

Changes in operating assets and liabilities:
Accounts receivable, net and other assets	133.9		397.5		(263.6)
Investment in films and television programs and program rights	(1,616.7)		(1,545.3)		(71.4)
Accounts payable and accrued liabilities	32.7		(31.8)		64.5
Other changes in operating assets and liabilities	(66.1)		(49.1)		(17.0)
Changes in operating assets and liabilities	(1,516.2)		(1,228.7)		(287.5)
Net Cash Flows Provided By (Used In) Operating Activities	$	(0.5)	$	614.6	$	(615.1)

Cash flows ~~provided by~~used in operating activities for the fiscal year ended March 31, ~~2020~~2021 were ~~$614.6~~$0.5 million compared to cash flows provided by operating activities of ~~$427.5~~$614.6 million for the fiscal year ended March 31, ~~2019.~~2020. The increase in cash ~~provided by~~used in operating activities for fiscal ~~2020~~2021 as compared to fiscal ~~2019~~2020 is due to ~~higher~~lower cash flows from operations before changes in operating assets and liabilities, ~~which in fiscal 2019 included the portion of the shareholder litigation settlement associated with the Starz merger. The increase was partially offset by an increase in~~and greater cash used from changes in operating assets and liabilities ~~which were~~as shown above. The greater use of cash from changes in operating assets and liabilities was driven by lower decreases in accounts receivable, net and other assets, and ~~increases in~~greater cash used for investment in films and television programs and program rights. These decreases were partially offset by lower use of cash from increases in accounts payable and accrued liabilities, as reflected above, and the receipt of $64.3 million from the Internal Revenue Service related to the Company's net operating loss carryback claim which is subject to review and included in other liabilities until the review is completed. In addition, cash flows ~~provided by~~used in operating activities for the fiscal year ended March 31, ~~2020 benefited by~~2021 included a net benefit of approximately ~~$253.0~~$28.2 million from the monetization

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of accounts receivables programs, as compared to a benefit of ~~$347.0~~approximately $253.0 million for the year ended March 31, ~~2019~~2020 (see Note 20 to our consolidated financial statements).

Investing Activities. Cash flows used in investing activities for the fiscal years ended March 31, ~~2020~~2021 and ~~2019~~2020 were as follows:


	Year Ended March 31,							Year Ended March 31,
	2020			2019				2021		2020
	(Amounts in millions)							(Amounts in millions)
Investing Activities:							Investing Activities:
Proceeds from the sale of equity method investees, net of transaction costs	$	—		$	48.0
Proceeds from the sale of equity method and other investments							Proceeds from the sale of equity method and other investments	$	4.1	$	—
Investment in equity method investees and other	(20.6		)	(48.6		)	Investment in equity method investees and other	(0.2)		(20.6)
Business acquisitions, net of cash acquired of $5.5 in 2019	—			(77.3		)

Capital expenditures	(31.1		)	(43.8		)	Capital expenditures	(35.0)		(31.1)
Net Cash Flows Used In Investing Activities	$	(51.7	)	$	(121.7	)	Net Cash Flows Used In Investing Activities	$	(31.1)	$	(51.7)

Cash flows used in investing activities of $31.1 million for the fiscal year ended March 31, 2021 compared to cash flows used in investing activities of $51.7 million for the fiscal year ended March 31, 2020, ~~compared to cash used in investing activities of $121.7 million for the fiscal year ended March 31, 2019, as reflected above. The change was~~ primarily due to ~~cash used in fiscal 2019 for the purchase of 3 Arts Entertainment, net of cash acquired, and less cash used in fiscal 2020~~

~~for~~lower investment in equity method investees and ~~capital expenditures, offset partially by~~other, as reflected above.

In addition, on March 31, 2021, the ~~net proceeds~~Company sold its 75% majority interest in Pantaya to Hemisphere Media Group for approximately $123.6 million in cash which was paid on April 1, 2021, therefore the receivable for the purchase consideration is included in other current assets as of March 31, 2021 and excluded from the ~~sale~~consolidated statement of cash flows, as a non-cash investing activity, for the year ended March 31, 2021 (see Note 20 to our ~~equity interest in Pop in fiscal 2019.~~consolidated financial statements).

Financing Activities. Cash flows ~~used in~~provided by (used in) financing activities for the fiscal years ended March 31, ~~2020~~2021 and ~~2019~~2020 were as follows:


	Year Ended March 31,							Year Ended March 31,
	2020			2019				2021		2020
	(Amounts in millions)							(Amounts in millions)
Debt - borrowings	$	852.1		$	3,541.2		Debt - borrowings	$	200.0	$	852.1
Debt - repurchases and repayments	(1,033.4		)	(3,212.7		)	Debt - repurchases and repayments	(267.6)		(1,033.4)
Net (repayments of) proceeds from debt	(181.3		)	328.5
Net repayments of debt							Net repayments of debt	(67.6)		(181.3)

Production loans - borrowings	59.0			338.1			Production loans - borrowings	273.7		59.0
Production loans - repayments	(293.8		)	(305.4		)	Production loans - repayments	(53.0)		(293.8)
Net (repayments of) proceeds from production loans	(234.8		)	32.7
Net proceeds from (repayments of) production loans							Net proceeds from (repayments of) production loans	220.7		(234.8)

Production tax credit facility advances							Production tax credit facility advances	118.8		—
Repurchase of common shares	(2.6		)	—			Repurchase of common shares	(2.2)		(2.6)
Payment of dissenter liability accrued at acquisition	—			(797.3		)
Other financing activities	(7.4		)	(63.2		)	Other financing activities	(31.8)		(7.4)
Net Cash Flows Used In Financing Activities	$	(426.1	)	$	(499.3	)
Net Cash Flows Provided By (Used In) Financing Activities							Net Cash Flows Provided By (Used In) Financing Activities	$	237.9	$	(426.1)



Fiscal ~~2020~~2021
Syndication - Debmar-Mercury
Title
~~Ambitions~~Bojack Horseman
~~Bojack Horseman~~Central Ave
~~Caught In Providence~~Family Feud
~~Family Feud~~Schitt's Creek
~~House of Payne~~
~~Meet The Browns~~
Wendy Williams



Fiscal ~~2020~~2021 Television - Lionsgate UK
Title			Network		Partner(s)
~~Kiss Me First~~The A-List Series 2			~~Channel 4/~~Netflix		Kindle Entertainment ~~Balloon Entertainment~~
The ~~A-List~~Pact			~~BBC3~~BBC Wales		~~Kindle Entertainment~~Little Door
~~Jerk~~Motherland Series 3			~~BBC3~~BBC		~~Primal Media, Roughcut TV~~BBC, Merman,
~~Motherland Series 2~~			~~BBC~~	~~BBC, Merman, Delightful~~
The Goes Wrong Show Series 2	BBC			Mischief Screen, Big Talk, BBC
~~Cold Courage~~	~~Viaplay~~	~~Luminoir~~



Title		~~Number of Episodes~~
~~Vida~~ ~~Season 3~~		6
~~High Town~~Confronting a Serial Killer Season 1	8
~~P-Valley~~ ~~Season 1~~		8
~~TBD 1~~	~~TBD~~
~~TBD 2~~	~~TBD~~
~~Power II: Ghost~~ ~~Season 1~~	10
~~Spanish Princess~~ ~~Part 2~~	8
~~TBD 3~~	~~TBD~~
~~American Gods~~The Girlfriend Experience Season 3	10
Run the World Season 1
8Little Birds (limited series)
~~TBD 4~~Blindspotting Season 1
~~TBD~~Power Book III: Raising Kanan Season 1
~~Step Up~~Heels Season 31		10
Black Mafia Family Season 1
Hightown Season 2
Power Book II: Ghost Season 2
Shining Vale Season 1
TBD documentary series
Power Book IV: Force Season 1
Outlander Season 6
Total Episodes: 113



Title		~~Number of Episodes~~
~~Spanish Princess~~ ~~Part 1~~	8
Vida Season 23		10
~~The Rook~~Hightown Season 1		8
~~Sweetbitter~~P-Valley Season 21		8
Power Book II: Ghost Season 61		15
~~Leavenworth~~The Spanish Princess ~~(documentary series)~~Part 2		5
~~Dublin Murders~~	8
~~Wrong Man~~Seduced: Inside the NXIVM Cult ~~Season 2 (documentary~~(documentary series)		6
~~Outlander~~American Gods Season 53		12
Men in Kilts Season 1 (reality travel series)
80 The Gloaming Season 1
Total Episodes: 70



Significant output programming agreements		Significant library programming agreements
Studio	~~Term~~ ~~(1)~~		Studio	~~Term~~
Sony ~~. . . . . . . . . . . . . . . . . . . . . . . . .~~	~~12/2021~~		Paramount ~~. . . . . . . . . . . . . . . . . . . .~~	~~08/2022~~
Lionsgate			Warner ~~Bros. . . . . . . . . . . . . . . . . . .~~	~~12/2022~~Bros
			Miramax ~~. . . . . . . . . . . . . . . . . . . . . .~~	~~02/2023~~
			Twentieth Century ~~Fox. . . . . . . .. . . .~~	~~02/2025~~Fox
			MGM ~~. . . . . . . . . . . . . . . . . . . . . . . . .~~	~~04/2025~~
			Sony ~~Pictures. . . . . . . . . . . . . . . . . . . .~~	~~12/2025~~Pictures
			Lionsgate ~~. . . . . . . . . . . . . . . . . . . . . .~~	~~01/2026~~
			Universal ~~. . . . . . . . . . . . . . . . . . . . .~~	~~03/2027~~
~~(1) Dates based on initial theatrical release.~~



Title		~~Number of Episodes~~
~~Vida~~ Confronting a Serial Killer Season 3		61
~~High Town~~ The Girlfriend Experience Season 1		83
~~P-Valley S1~~		8
~~TBD 1~~	~~TBD~~
~~TBD 2~~	~~TBD~~
~~Power II: Ghost Season 1~~	10
~~Spanish Princess Part 2 (not available in Spain)~~	8
~~TBD 3~~	~~TBD~~
Run the World Season 1	8
~~TBD 4~~		~~TBD~~ Blindspotting Season 1
~~Step Up~~ Power Book III: Raising Kanan Season 3		101
Heels Season 1
Black Mafia Family Season 1
Shining Vale Season 1
Power Book IV: Force Season 1
Hightown Season 2
TBD documentary series
Outlander Season 6 (UK only)
Power Book II: Ghost Season 2
Total Episodes: 107



Title		Countries Available	~~Number of Episodes~~
~~Dublin Murders~~ Vida Season 3		~~DE, FR, IT, ES, Benelux, LatAm, Brazil~~	8All Countries
~~The Rook~~ Hightown Season 1		~~DE, FR, IT, ES, Benelux, LatAm, Brazil~~	8All Countries
P-Valley Season 1		All Countries
Power Book II: Ghost Season 1		All Countries
The Spanish PrincessPart 2		UK, DE, FR, IT, Benelux, LatAm, Brazil	8
~~Vida~~Seduced: Inside the NXIVM Cult		~~UK, DE, FR, IT, ES, Benelux, LatAm, Brazil~~	10All Countries
~~Sweetbitter~~Total Episodes: 70		~~UK, DE, FR, IT, ES, Benelux, LatAm, Brazil~~	8
~~Power~~	ES	13
		55



3 Arts Entertainment		~~In May 2018, we acquired~~We hold a majority ~~stake~~interest in 3 Arts Entertainment, a leading talent management and television/film production company.

~~Atom Tickets~~	~~In August 2014, we acquired an interest in Atom Tickets, a first-of-its-kind social movie ticketing app.~~

~~Pantelion Films~~	In September 2010, we launched Pantelion Films, a joint venture with Videocine, an affiliate of Televisa, which produces, acquires and distributes a slate of English and Spanish language feature films that target Hispanic moviegoers in the U.S.

Pilgrim Media Group	~~In November 2015, we acquired an~~We hold a majority interest in Pilgrim Media Group, a leader in unscripted programming.

Roadside Attractions	~~In July 2007, we acquired~~We hold an interest in Roadside Attractions, an independent theatrical distribution company.

STARZPLAY Arabia	~~Launched~~We hold an interest in ~~2015,~~ STARZPLAY Arabia, is a personalized OTT entertainment service that operates in 19 Middle East/North African ~~countries. STARZPLAY Arabia offers~~countries, offering a deep selection of Hollywood movies and television series with English, Arabic and French language options, along with local Arabic and Bollywood content.



ISSUER PURCHASES OF EQUITY SECURITIES
Period	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
January 1, 2020 - January 31, 2020	—	$	—	—	$	184,713,820
February 1, 2020 - February 29, 2020	—	—		—	184,713,820
March 1, 2020 - March 31, 2020	704,795	5.43		704,795	180,886,791
Total	704,795	$	5.43	704,795	$	180,886,791



	Year Ended March 31,
	2020⁽¹⁾⁽⁵⁾			2019⁽²⁾⁽⁵⁾			2018⁽³⁾		2017⁽⁴⁾			2016⁽⁴⁾
	(Amounts in millions, except per share amounts)
Statement of Operations Data:
Revenues	$	3,890.0		$	3,680.5		$	4,129.1	$	3,201.5		$	2,347.4
Operating income (loss)	2.8			130.0			248.7		(16.3		)	(25.0		)
Net income (loss)	(206.4		)	(299.6		)	468.1		14.5			42.7
Net income (loss) attributable to Lions Gate Entertainment Corp. shareholders	(188.4		)	(284.2		)	473.6		14.8			50.2
Per share information attributable to Lions Gate Entertainment Corp. shareholders:
Basic net income (loss) per common share	$	(0.86	)	$	(1.33	)	$	2.27	$	0.09		$	0.34
Diluted net income (loss) per common share	$	(0.86	)	$	(1.33	)	$	2.15	$	0.09		$	0.33
Weighted average number of common shares outstanding:
Basic	217.9			213.7			208.4		165.0			148.5
Diluted	217.9			213.7			220.4		172.2			154.1
Dividends declared per common share	$	—		$	0.18		$	0.09	$	0.09		$	0.34

Balance Sheet Data (at end of period):
Cash and cash equivalents	$	318.2		$	184.3		$	378.1	$	321.9		$	57.7
Investment in films and television programs and program rights	1,827.8			1,967.7			1,945.2		1,991.2			1,457.6
Total assets	7,951.2			8,408.9			8,967.6		9,196.9			3,834.2
Total debt, net⁽⁶⁾	2,733.0			2,904.4			2,557.4		3,124.9			865.2
Production loans, net	151.3			385.4			352.5		353.3			690.0
Dissenting shareholders' liability⁽⁷⁾	—			—			869.3		812.9			—
Redeemable noncontrolling interests	167.8			127.6			101.8		93.8			90.5
Total Lions Gate Entertainment Corp. shareholders' equity	2,658.0			2,918.7			3,155.9		2,514.4			850.3
Total equity	2,660.0			2,921.9			3,156.9		2,514.4			850.3


~~(1)~~	~~Severance costs in the fiscal years ended March 31, 2020 and 2019 were primarily related to restructuring activities in connection with recent acquisitions, and other cost-saving initiatives.~~


~~(2)~~	During the year ended March 31, 2020, the Company has incurred certain costs including costs primarily related to transitioning the Company to a remote-work environment and other incremental costs associated with the COVID-19 global pandemic.


~~(1)~~	The 6.375% Senior Notes were issued in February 2019, therefore fiscal 2020 includes a full year of interest expense, as compared to fiscal 2019, which includes approximately two months of interest expense.


~~(2)~~	~~Amounts include interest expense related to the Company's interest rate swap agreements (see Note 19 to our consolidated financial statements), finance lease obligations and other interest.~~


~~(3)~~	~~Represents interest accrued in connection with the previously outstanding dissenting shareholders' liability associated with the Starz Merger.~~


~~(1)~~	~~Feature Film:~~ Includes theatrical releases through our Lionsgate and Summit Entertainment film labels, which includes films developed and produced in-house, films co-developed and co-produced and films acquired from third parties.


~~(2)~~	~~Other Film:~~ Includes direct-to-DVD motion pictures, acquired and licensed brands, third-party library product and ancillary-driven platform theatrical releases through our specialty films distribution labels including Lionsgate Premiere, through Good Universe, and with our equity method investees, Roadside Attractions and Pantelion Films, and other titles.



			Pro Forma
	March 31,	March 31,	March 31,
	2020	2019	2019
	(Amounts in millions)
Domestic Subscribers
STARZ	18.9	24.7	16.8
Other Streaming Services⁽¹⁾	0.7	0.3	0.3
	19.6	25.0	17.1
International Subscribers
STARZPLAY International	3.2	2.0	2.0
STARZPLAY Arabia⁽²⁾	1.8	1.1	1.1
	5.0	3.1	3.1
Total Domestic and International Subscribers	24.6	28.1	20.2

Subscribers by Platform:
Linear Subscribers	14.0	22.6	14.7
OTT Subscribers⁽³⁾	10.6	5.5	5.5
Total Global Subscribers	24.6	28.1	20.2



	Year Ended March 31,
	2021		2022		2023		2024		2025		Thereafter		Total
					(Amounts in millions)								��
Future annual repayment of debt and other obligations recorded as of March 31, 2020 (on-balance sheet arrangements)
Revolving credit facility	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Term Loan A	52.5		75.0		585.0		—		—		—		712.5
Term Loan B	12.5		12.5		12.5		12.5		915.1		—		965.1
5.875% Senior Notes	—		—		—		—		518.7		—		518.7
6.375% Senior Notes	—		—		—		545.6		—		—		545.6
Film obligations and production loans⁽¹⁾	353.8		47.0		38.3		7.5		2.4		1.6		450.6
Operating lease obligations⁽²⁾	41.2		33.1		32.4		20.3		13.0		47.0		187.0
Finance lease obligations⁽²⁾	3.0		0.9		0.9		1.0		1.0		35.6		42.4
	463.0		168.5		669.1		586.9		1,450.2		84.2		3,421.9
Contractual commitments by expected repayment date (off-balance sheet arrangements)
Film obligation and production loan commitments⁽³⁾	391.8		384.1		111.5		74.1		7.8		17.4		986.7
Interest payments⁽⁴⁾	161.8		161.8		157.0		133.4		90.8		34.0		738.8
Other contractual obligations	143.3		75.6		45.4		10.8		7.3		49.0		331.4
	696.9		621.5		313.9		218.3		105.9		100.4		2,056.9
Total future repayment of debt and other commitments under contractual obligations⁽⁴⁾	$	1,159.9	$	790.0	$	983.0	$	805.2	$	1,556.1	$	184.6	$	5,478.8


~~(1)~~	Film obligations include minimum guarantees, theatrical marketing obligations, and accrued licensed program rights obligations. Production loans represent loans for the production of film and television programs that we produce. Repayment dates are based on anticipated delivery or release date of the related film or contractual due dates of the obligation.


~~(2)~~	~~See Note 8 to our consolidated financial statements for further information on leases.~~


~~(4)~~	Includes cash interest payments on our debt (including interest on finance lease obligations), excluding the interest payments on the revolving credit facility as future amounts are not fixed or determinable due to fluctuating balances and interest rates.


~~(5)~~	Not included in the amounts above are $167.8 million of redeemable noncontrolling interest, as future amounts and timing are subject to a number of uncertainties such that we are unable to make sufficiently reliable estimations of future payments (see Note 12 to our consolidated financial statements).


																											Year Ended March 31,															Fair Value
				Year Ended March 31,																Fair Value				2022			2023			2024			2025			2026		Thereafter		Total		March 31, 2021
	2021			2022			2023			2024			2025			Thereafter		Total		March 31, 2020										(Amounts in millions)
							(Amounts in millions)
Debt and Production Loans
Debt, Production Loans and Production Tax Credit Facility																							Debt, Production Loans and Production Tax Credit Facility
Variable Rates:																							Variable Rates:
Revolving Credit Facility⁽¹⁾	$	—		$	—		$	—		$	—		$	—		$	—	$	—	$	—
Revolving Credit Facility(1)(2)																							Revolving Credit Facility(1)(2)	$	—		$	—		$	—		$	—		$	—	$	—	$	—	$	—
Average Interest Rate	—			—			—			—			—			—							Average Interest Rate	—			—			—			—			—		—
Term Loan A⁽¹⁾	52.5			75.0			585.0			—			—			—		712.5		637.7
Term Loan A(1)(2)																							Term Loan A(1)(2)	75.0			585.0			—			—			—		—		660.0		647.6
Average Interest Rate	2.74		%	2.74		%	2.74		%	—			—			—							Average Interest Rate	1.86		%	1.86		%	—			—			—		—
Term Loan B⁽¹⁾	12.5			12.5			12.5			12.5			915.1			—		965.1		845.7			Term Loan B(1)	12.5			12.5			12.5			915.1			—		—		952.6		936.0
Average Interest Rate	3.24		%	3.24		%	3.24		%	3.24		%	3.24		%	—							Average Interest Rate	2.36		%	2.36		%	2.36		%	2.36		%	—		—
Production loans⁽¹⁾	132.8			—			18.6			—			—			—		151.4		151.4			Production loans(1)	238.7			102.1			32.7			—			—		—		373.5		373.5
Average Interest Rate	3.68		%	—			3.24		%	—			—			—							Average Interest Rate	2.63		%	2.42		%	2.38		%	—			—		—
Production tax credit facility(3)																							Production tax credit facility(3)	—			—			—			120.0			—		—		120.0		120.0
Average Interest Rate																							Average Interest Rate	—			—			—			1.61		%	—		—
Fixed Rates:																							Fixed Rates:
5.875% Senior Notes	—			—			—			—			518.7			—		518.7		430.5
5.875% Senior Notes(4)																							5.875% Senior Notes(4)	—			—			—			518.7			—		—		518.7		533.9
Average Interest Rate	—			—			—			—			5.875		%	—							Average Interest Rate	—			—			—			5.875		%	—		—
6.375% Senior Notes	—			—			—			545.6			—			—		545.6		452.9
6.375% Senior Notes(4)																							6.375% Senior Notes(4)	—			—			545.6			—			—		—		545.6		563.0
Average Interest Rate	—			—			—			6.375		%	—			—							Average Interest Rate	—			—			6.375		%	—			—		—
Interest Rate Swaps⁽²⁾
Interest Rate Swaps(5)																							Interest Rate Swaps(5)
Variable to fixed notional amount	—			—			—			—			1,700.0					1,700.0		(187.9		)	Variable to fixed notional amount	—			—			—			300.0			—		1,400.0		1,700.0		74.1


~~(1)~~	(1)The effective interest rate in the table above is before the impact ~~of interest rate swaps.~~


~~(2)~~	Represents interest rate swap agreements on certain of our LIBOR-based floating-rate corporate debt with fixed rates paid ranging from 2.723% to 2.915% maturing in March 2025. See Note 19 to our consolidated financial statements. On May 15, 2020, the Company entered into certain transactions which effectively extended the maturity date on an aggregate of


~~(a)~~	~~The following documents are filed as part of this report:~~


			Additions															Additions
Description	Balance at Beginning of Period		Charged to Costs and Expenses⁽¹⁾			Charged to Other Accounts			Deductions				Balance at End of Period		Description	Balance at Beginning of Period		Charged to Costs and Expenses(1)		Charged to Other Accounts			Deductions			Balance at End of Period
Year Ended March 31, 2021:															Year Ended March 31, 2021:
Reserves:															Reserves:
Returns and allowances															Returns and allowances	$	33.7	$	53.3	$	0		$	(60.9)	(2)	$	26.1
Provision for doubtful accounts															Provision for doubtful accounts	$	9.3	$	(2.5)	$	0		$	(0.3)	(3)	$	6.5
Deferred tax valuation allowance															Deferred tax valuation allowance	$	435.8	$	(56.3)	$	(28.6)	(4)	$	0		$	350.9

Year Ended March 31, 2020:															Year Ended March 31, 2020:
Reserves:															Reserves:
Returns and allowances	$	35.0	$	81.2		$	—		$	(82.5	)	⁽²⁾	$	33.7	Returns and allowances	$	35.0	$	81.2	$	0		$	(82.5)	(2)	$	33.7
Provision for doubtful accounts	$	5.4	$	5.7		$	—		$	(1.8	)	⁽³⁾	$	9.3	Provision for doubtful accounts	$	5.4	$	5.7	$	0		$	(1.8)	(3)	$	9.3
Deferred tax valuation allowance	$	401.1	$	4.5		$	30.2	⁽⁴⁾	$	—			$	435.8	Deferred tax valuation allowance	$	401.1	$	4.5	$	30.2	(4)	$	0		$	435.8

Year Ended March 31, 2019:															Year Ended March 31, 2019:
Reserves:															Reserves:
Returns and allowances	$	56.2	$	126.0		$	—		$	(147.2	)	⁽²⁾	$	35.0	Returns and allowances	$	56.2	$	126.0	$	0		$	(147.2)	(2)	$	35.0
Provision for doubtful accounts	$	7.5	$	(2.0	)	$	—		$	(0.1	)	⁽³⁾	$	5.4	Provision for doubtful accounts	$	7.5	$	(2.0)	$	0		$	(0.1)	(3)	$	5.4
Deferred tax valuation allowance	$	73.2	$	313.9		$	14.0	⁽⁴⁾	$	—			$	401.1	Deferred tax valuation allowance	$	73.2	$	313.9	$	14.0	(4)	$	0		$	401.1

Year Ended March 31, 2018:
Reserves:
Returns and allowances	$	68.6	$	168.3		$	—		$	(180.7	)	⁽²⁾	$	56.2
Provision for doubtful accounts	$	9.0	$	(1.0	)	$	—		$	(0.5	)	⁽³⁾	$	7.5
Deferred tax valuation allowance	$	5.9	$	67.3		$	—		$	—			$	73.2


~~(1)~~	~~Charges for returns and allowances are charges against revenue.~~


~~(2)~~	~~Actual returns and fluctuations in foreign currency exchange rates.~~


~~(3)~~	~~Uncollectible accounts written off and fluctuations in foreign currency exchange rates.~~


~~(4)~~	~~Valuation allowance addition recorded in other comprehensive income and primarily associated with hedging losses.~~



Exhibit Number	Exhibit Description	Incorporated by Reference
Exhibit Number	Exhibit Description	Form	Exhibit	Filing Date/ Period End Date
2.1	Agreement and Plan of Merger, dated as of June 30, 2016, by and among Lions Gate, Starz, and Orion Arm Acquisition Inc.	8-K	2.1	7/1/2016
3.1	Articles	8-K	3.1	12/8/2016
3.2	Notice of Articles	8-K/A	3.1	12/9/2016
4.1	Supplemental Indenture, dated as of December 8, 2016, among Lions Gate Entertainment Corp., the guarantors party thereto, and Deutsche Bank Trust Company Americas, as trustee	8-K	4.1	12/8/2016
4.2	Indenture, dated as of October 27, 2016, by and between LG FinanceCo Corp. and Deutsche Bank Trust Company Americas, as trustee	8-K	4.1	10/27/2016
4.3	Indenture, dated as of March 28, 2018, by and between Lions Gate Capital Holdings LLC, as issuer, the guarantors named therein, and Deutsche Bank Trust Company Americas, as trustee	8-K	4.1	3/28/2018
4.4	Indenture, dated as of February 4, 2019, by and among Lions Gate Capital Holdings, LLC the Guarantors named therein, and Deutsche Bank Trust Company, as Trustee	8-K	4.1	2/4/2019
4.5	Description of Class A voting shares, no par value per share	S-4	—	8/1/2016
4.6	Description of Class B non-voting shares, no par value per share	S-4	—	8/1/2016
10.1*x	Director Compensation Summary
10.2	Form of Director Indemnity Agreement	10-Q	10.62	12/31/2008
10.3	Letter Agreement between Mark H. Rachesky and Lions Gate Entertainment Corp. dated July 9, 2009	8-K	10.65	7/10/2009
10.4	Registration Rights Agreement, dated as of October 22, 2009, by and among Lions Gate Entertainment Corp. and the persons listed on the signature pages thereto	8-K	10.68	10/23/2009
10.5	Membership Interest Purchase Agreement, dated as of January 13, 2012, among Lions Gate Entertainment Corp., LGAC 1, LLC, LGAC 3, LLC, Summit Entertainment, LLC, S Representative, LLC and the several sellers party thereto	8-K	2.1	1/17/2012
10.6*	Employment Agreement, dated May 30, 2013, between the Company and Jon Feltheimer	8-K	10.1	6/3/2013
10.7	Stock Exchange Agreement, dated as of February 10, 2015, by and between Lions Gate Entertainment Corp., LG Leopard Canada LP and the stockholders listed on Schedule 1 thereto	8-K	10.1	2/11/2015
10.8	Underwriting Agreement dated April 8, 2015, by and among Lions Gate Entertainment Corp., MHR Capital Partners Master Account LP, MHR Capital Partners (100) LP, MHR Institutional Partners II LP, MHR Institutional Partners IIA LP, MHR Institutional Partners III LP and J.P. Morgan Securities LLC	8-K	1.1	4/9/2015
10.9	Investor Rights Agreement, dated as of November 10, 2015, by and among Lions Gate Entertainment Corp., Liberty Global plc, Discovery Communications, Inc., Liberty Global Incorporated Limited, Discovery Lightning Investments Ltd. and affiliates of MHR Fund Management, LLC	8-K	10.1	11/10/2015
10.10	Voting and Standstill Agreement, dated as of November 10, 2015, by and among Lions Gate Entertainment Corp., Liberty Global plc, Discovery Communications, Inc., Liberty Global Incorporated Limited, Discovery Lightning Investments Ltd., Dr. John C. Malone and affiliates of MHR Fund Management, LLC	8-K	10.2	11/10/2015
10.11	Registration Rights Agreement, dated as of November 10, 2015, by and among Lions Gate Entertainment Corp. and Liberty Global Incorporated Limited	8-K	10.3	11/10/2015
10.12	Registration Rights Agreement, dated as of November 10, 2015, by and among Lions Gate Entertainment Corp. and Discovery Lightning Investments Ltd.	8-K	10.4	11/10/2015



~~Exhibit Number~~*			~~Exhibit Description~~	~~Incorporated by Reference~~
~~Form~~	~~Exhibit~~	~~Filing Date/~~ ~~Period End Date~~
~~10.34*x~~	~~Employment Agreement between Lions Gate Entertainment Corp. and Corii D. Berg dated as of May 15, 2020~~
~~21.1x~~	~~Subsidiaries of the Company~~
~~23.1x~~	~~Consent of Ernst & Young LLP~~
~~24.1x~~	~~Power of Attorney (Contained on Signature Page)~~
~~31.1x~~	~~Certification of CEO pursuant to Section 302 of Sarbanes-Oxley Act of 2002~~
~~31.2x~~	~~Certification of CFO pursuant to Section 302 of Sarbanes-Oxley Act of 2002~~
~~32.1x~~	~~Certification of CEO and CFO pursuant to Section 906 of Sarbanes-Oxley Act of 2002~~
~~101x~~	The following financial statements from the Company's Annual Report on Form 10-K for the year ended March 31, 2020, formatted in Inline XBRL: (i) Consolidated Balance Sheets (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Equity, (v) Consolidated Statements of Cash Flows and (vi) Notes to Consolidated Financial Statements, tagged as blocks of text and including detailed tags.
~~104x~~	~~The cover page from the Company’s Annual Report on Form 10-K for the year ended March 31, 2020 (formatted as Inline XBRL and contained in Exhibit 101).~~



*	Management contract or compensatory plan or arrangement.
x		Filed herewith