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Music Box Entertainment to Invest $27 Million in MDP Worldwide

6/24/2002

MDP Worldwide Entertainment Inc. ("MDP" or the "Company") (Toronto Stock Exchange: MDP.A; MDP.B) announced that it has entered into a Memorandum of Understanding with Music Box Entertainment Ltd. ("Music Box"), a company to be owned by Dr. Cheng Kar-Shun, Henry and Mr. Sammy S. Lee, for the purpose of a proposed equity investment in MDP of approximately $27 million.

Pursuant to the Memorandum of Understanding, Music Box will subscribe to 260,228,365 convertible preferred shares of MDP, which will be convertible on a one-to-one basis into Class B Subordinate Voting Shares. After giving effect to the proposed equity investment, Music Box will hold convertible preferred shares representing approximately 62% of the total issued and outstanding shares of MDP. The transaction is scheduled to close and fund by July 8, 2002 and is subject to regulatory and other customary approvals and completion of definitive long form agreements giving effect to the terms and conditions set forth in the Memorandum of Understanding.

Mark Damon, Chairman and CEO of MDP, stated, "This sizeable equity infusion will significantly expand the Company's capital base and enable it to increase its bank lines of credit, which should help us to realize the potential of our impressive slate of upcoming films. We expect that the closing of this transaction should have an accretive impact on shareholder value."

On closing, this transaction represents the completion of the Company's negotiations with entertainment legend Michael Jackson and his film producing partner Raju Sharad Patel, who will become principals in a newly formed film company that will have a "first- look" arrangement with MDP, and which will also be financed by Music Box. The new company will have access to its own film development funds so as to expedite the creative development of Jackson and Patel's film projects. Upon the closing of the transaction, both Jackson and Patel will collectively have a significant ownership stake in Music Box's holdings in MDP.

Mr. Lee, a prominent international financier, has been overseeing the Cheng family's global interests for many years and will be appointed Vice Chairman of MDP on the closing of the transaction. Mr. Lee's primary concentration over the past few years has been in overseeing New York's Trump Place, Lee's co-venture with Donald Trump, "The Knightsbridge" real estate development project in London as well as the refurbishment and opening of the Renaissance Chancery Court Hotel in London.

Dr. Cheng is Managing Director of New World Development Company Ltd., a publicly-traded company (HKSE 0017) majority-owned by the Cheng family with total assets exceeding $23 billion. New World's core businesses are property, infrastructure and telecommunications. New World is one of the leading infrastructure investors in the Far East and one of the largest international investors in mainland China. The Cheng family is recognized by Forbes Magazine as one of the richest families in the world. They own some of the world's most desirable hotels, including interests in the Regent Beverly Wilshire in Beverly Hills, the Grand Hyatt in Hong Kong and the Renaissance Group of hotels which has 75 hotels across Europe and the US. In addition, the Cheng family owns Chow Tai Fook, the famous chain of jewelry stores with over 80 stores in Hong Kong and Macau and its own manufacturing plant in Singapore.

Sammy Lee stated, "We are extremely pleased to be associated with Michael Jackson, Raju Patel, Mark Damon, and the entire MDP team and look forward to a long and mutually profitable relationship."

"I welcome Sammy and the Cheng family into the world of filmed entertainment, and I thank Michael and Raju for helping to bring this transaction to fruition. Sammy Lee's entrepreneurial spirit and business acumen will serve our company well," Mark Damon commented.

Raju Patel added, "Both Michael Jackson and I know that with Sammy Lee's involvement and Mark Damon's film expertise, we will be able to make our creative dreams come true by bringing wonderful film projects to this exciting new venture, films such as Wolfed and "Tom Thumb."

The transaction was negotiated by Stewart Hall, Malcolm Reeve, and Harris Tulchin, Esq. on behalf of Music Box; by Bruce Vann, Esq. and Joseph Cohen on behalf of the Jackson-Patel Co-Venture; by Phil Davis, Esq. on behalf of Michael Jackson; by Peter Dekom, Esq. and Larry Mortorff, Esq. on behalf of Raju Patel; and by Michael Eliasberg, Esq. on behalf of MDP.

MDP Worldwide currently has a number of feature films in various stages of development, production and distribution. In addition, the company recently announced the closing of an exclusive "first look" production and development deal with leading management and production company, Handprint Entertainment. The first picture to be developed under this new arrangement will be the romantic drama THE SIXTEEN PLEASURES, with world famous actress Nicole Kidman attached to star. Based on the best selling novel of the same name by Robert Hellenga, the story is about an American book restorer who must travel to Florence, Italy after a flood decimates the city's treasures. She embarks on the intrigue of a lifetime with a forbidden lover and a contraband volume of poetry. The script is to be written by John Collee, who is currently writing Master and Commander, which will star Russell Crowe and will be directed by Peter Weir.

MDP has also recently acquired international film licensing rights to the poignant emotional drama THE UNITED STATES OF LELAND, currently in post- production, which is directed by Matthew Ryan Hoge and produced by Kevin Spacey's Trigger Street Productions, and features an all star cast including Ryan Gosling (Murder by Numbers, Remember the Titans), Don Cheadle (Traffic, Swordfish), Chris Klein (American Pie 2, Rollerball), Lena Olin (Chocolat, The Unbearable Lightness of Being), Jena Malone (Life as a House, Donnie Darko), and Academy Award winner Kevin Spacey (American Beauty, The Shipping News). The company is also licensing international rights to the action comedy GEORGE AND THE DRAGON starring James Purefoy, Piper Perabo, Michael Duncan Clark, and Patrick Swayze.

Scheduled for wide theatrical release in North America in 2002, will be the cyber-horror film FEARdotCOM, which is currently scheduled to be released by Warner Bros. on August 30, 2002. The film stars Stephen Dorff, Natascha McElhone, and Stephen Rea and was produced by Moshe Diamant and Limor Diamant.

Also slated for a 2002 theatrical release in North America through Paramount Pictures is the extreme sports action film THE EXTREMISTS, which was directed by Christian Duguay and stars Devon Sawa, Bridgette Wilson-Sampras, Rufus Sewell, and Rupert Graves.


Certain statements in this report may constitute forward-looking statements. Such forward-looking statements involve risks, uncertainties and other factors which may cause actual results, performance, or achievements of the Company to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements.


MDP Worldwide Entertainment Inc. is a leading film entertainment company engaged in the financing, development, production, and worldwide distribution of feature films in all media. The company has offices in Montreal and Los Angeles.

For further information: Investor information: Devin Cutler, or Richard Kiratsoulis, , MDP Worldwide Entertainment Inc., , Fax: ; Press information: David Gaynes, , MDP Worldwide Entertainment Inc., Fax:

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