Relativity Media has established Gun Hill Road II, an independent co-financingpackage that provides discrete funds for both Sony Pictures Entertainment and Universal Pictures.

Thearrangement will provide production funds for 19 features, 11 from Sony andnine from Universal, one of which is a co-production between the two.

Thepictures are planned for release at some time between the last quarter of 2006and the end of 2007.

Eachtitle under the Gun Hill II programme was selected for financing based on thestrength of its respective film package, including cast, director, productionteams and studio management.

Thestudios will retain creative control and worldwide distribution rights to theirrespective films. Relativity retained Deutsche Bank to underwrite the debt andhelp structure the deal.

"Thereis perhaps no greater vote of confidence in the strength of our filmslate than the commitments we have secured through Gun Hill I and II,"said Bob Osher, chief operating officer of Columbia Pictures.

"Weare pleased to extend our agreement with Relativity Media and we are gratefulto Deutsche Bank for aiding in structuring these arrangements. We look forwardto a mutually beneficial relationship among Sony, Relativity and Deutsche Bankfor years to come."

RickFinkelstein, president and chief operating officer of Universal Pictures said: "Weare proud to continue our relationship with Relativity via the second round offinancing through Gun Hill II,"

"Thisdeal once again allows Universal the benefit of managing its risk while at thesame time retaining control of worldwide marketing and distribution."

"Weare fortunate to be in business with Sony and Universal," Relativity'sRyan Kavanaugh said. "The relationship developed over the last number ofmonths encouraged a new funding vehicle and we hope that through Gun Hill II wewill continue this fine working relationship."