Peace Arch Completes Trinity Acquisition

TORONTO, July 6: Peace Arch Entertainment Group has
completed the acquisition of the California-based DVD distributor Trinity Home
Entertainment for approximately $10 million.

Under the terms of the deal, Peace Arch acquired all of the
shares of Trinity for approximately $9.5 million in cash plus $500,000 of Peace
Arch common stock.

Trinity is an independent distributor of budget and
first-run feature films in the U.S. It has distribution relationships with the
Army and Air Force Exchange Service, along with major retailers such as
Wal-Mart and Trans World Entertainment. Genius Entertainment and Hearst
Entertainment are among Trinity’s key content suppliers. The company’s library
includes Stephen King’s Maximum Overdrive,
Raw Deal starring Arnold
Schwarzenegger and The Octagon
featuring Chuck Norris.

“The acquisition of Trinity furthers Peace Arch’s strategy
of building its in-house distribution capabilities while continuing to aggregate
highly marketable film and television content,” said John Flock, the president
of Peace Arch. “By merging Trinity’s U.S. operation with Peace Arch’s strong
home-entertainment division in Canada, Peace Arch now has a platform upon which
to build one of the leading independent distribution companies in North
America. The successful conclusion of this purchase is the latest example of
Peace Arch's high-growth business model focused on organic growth combined with
the acquisition of profitable content and distribution assets to create a fully
integrated entertainment company.”

Trinity founder and CEO Phillip Knowles will remain with the
company as president and head its U.S. DVD distribution operations, reporting
to Berry Meyerowitz, the president of Peace Arch Home Entertainment.