TV1-SF-SET Australia Opportunity Overview

May 2013

[PRELIMINARY DRAFT] Executive Summary

Sony Pictures Television (“SPT”) is seeking approval to take ownership control of the TV1 and Sci-Fi (SF) channels and utilize the TV1/SF infrastructure and management team to launch a 3rd Sony branded (“SET”) channel in Australia on the Foxtel platform

• SPT, CBS Studios, and Comcast/NBC Universal are currently equal partners in Australian Pay-TV channels TV1 and Sci-Fi (SF) on the Foxtel platform

• Recent affiliate renewal negotiations has Foxtel significantly reducing subscriber fees for both TV1 and SF which have historically contributed ~50% to total revenue

• The fee reductions have forced the board/management to consider (1) dissolving the partnership or (2) reducing programming and operating costs to off-set the expected decline in subscription revenue

• SPT is proposing a 3rd option which would have SPT take on the TV1 and SF channels, streamline their operations and utilize their infrastructure/team to launch a 3rd channel branded “SET”

• SPT’s proposed SET channel would consist of TV and film product from various genres, leveraging Sony’s extensive content library

• New SET channel to be created in parallel to running TV1 and SF and assumes a Jan 1, 2014 launch date

• The current consolidated business plan has projected NPV of $14.7M and a DWM of ($5.2M). NPV of $17.8M and a DWM of ($3.3M) when including incremental license fees paid to SPE (1)

(1) Incremental license fees assumes 75% of SET channel content will be SPE library content. Includes 15% for residuals and 40% in2 taxes. Situation Overview SPT is in a strong position to successfully take control of TV1 and SF while launching a Sony branded general entertainment channel in Australia

• SPT is in discussions with CBS and NBCU to renew long-term output deals for TV1, SF and the Sony branded SET channel – The TV1/SF partnership will be dissolved with CBS and NBCU selling their stakes to SPT – CBS and NBCU will sell their stakes to SPT for a fraction of their value since CBS and NBCU are primarily concerned with extracting ongoing licensing fees from TV1, SF and a 3rd Sony branded channel in Australia

• SPT is negotiating with Foxtel to secure a long-term carriage agreement for the SET channel – Foxtel has agreed to carry the newly formed channel on the basic tier, however, additional terms in the agreement still need to be discussed (i.e., content commitment, etc.) – SPT’s proposed channel will be fully ad-supported with no subscriber fees and be positioned as the home of addictive primetime dramas and long running daytime soaps from the U.S. and Australia

• TV1/SF management has provided improved ad sales projections and cost reductions which have significantly off-set the reduction in subscriptions revenues from Foxtel – Ad sales forecasts were revised to account for the a 3rd channel and a likely uptick in Pay TV ad sales – Cost reductions include, but are not limited to, the following:: – Programming savings from revised output agreements and reduced unique hours – Ad sales cost reductions from 3rd party ad sales representatives 3 – Overhead costs including reductions in salaries/headcount and technical ops Strategic Benefit to SPE SPT has an opportunity to expand our international network footprint and gain immediate operational control of TV1 and SF with limited capital investment

• SPT to take ownership and operational control of TV1 and SF – Deal structured for SPE to consolidate earnings for TV1 and SF – Capitalize on restructured operations leading to significant cost savings and synergies

• SPT to launch a wholly owned channel, creating long-term asset value, while leveraging TV1 and Sci-Fi’s pre-existing infrastructure Sony branded channel to be positioned as the home of addictive primetime dramas and long running daytime soaps from the U.S. and Australia Enhance brand value for SPE by introducing a Sony branded channel into the Australia market

• Allows SPT to capture a revitalizing ad market in Australia Recently improved consumer confidence is driving higher growth in the overall ad market Pay TV advertising revenue is expected to continue to outgrow FTA with a forecast of $801M in 2015 (CAGR of 7.9% from 2012)

• Generates incremental licensing revenue for SPE library product – Channel will draw heavily on SPE titles – including library films and unique TV product that has yet to be seen in Australia – All titles will be non-exclusive and licensed at market-rate terms 4 [Preliminary] Consolidated Financial Overview Sony Fiscal Year ending, March 2014 2015 2016 2017 2018 REVENUE Subscriber Revenue $19,679,737 $6,634,785 $6,773,103 $6,901,805 $7,033,093 Advertising Revenue $22,585,583 $26,245,866 $28,414,409 $29,916,380 $31,412,199 Advertising Costs ($8,289,416) ($7,554,152) ($7,263,691) ($7,342,138) ($7,547,220) Net Ad Rev $14,296,167 $18,691,713 $21,150,718 $22,574,242 $23,864,979 TOTAL REVENUE $33,975,904 $25,326,498 $27,923,821 $29,476,046 $30,898,072 COSTS Content ($21,763,793) ($18,139,574) ($16,221,096) ($16,176,246) ($16,479,856) Local Content ($1,362,584) ($1,813,957) ($1,622,110) ($1,617,625) ($1,647,986) Opex ($9,672,408) ($8,796,516) ($8,846,382) ($9,051,132) ($9,261,032) Playout ($225,000) ($900,000) ($900,000) ($900,000) ($900,000) TOTAL COSTS $33,023,785 $29,650,048 $27,589,588 $27,745,003 $28,288,873 Depreciation ($334,001) ($334,001) ($334,001) ($334,001) ($334,001) EBIT $618,118 ($4,657,550) $232 $1,397,043 $2,275,198 Cumulative EBIT $618,118 ($4,039,432) ($4,039,200) ($2,642,157) ($366,959) Less: PPA (1) $0 $0 $0 $0 $0 EBIT AFTER PPA $618,118 ($4,657,550) $232 $1,397,043 $2,275,198 CASH FLOW SPT EBIT (After PPA) $618,118 ($4,657,550) $232 $1,397,043 $2,275,198 Add: Changes in Net Working Capital $356,215 $482,575 ($673,965) ($283,887) ($225,651) Add: Depreciation $334,001 $334,001 $334,001 $334,001 $334,001 Add:PPA $0 $0 $0 $0 $0 Adjustment for Content Amortization ($218,171) ($1,700,000) $0 $0 $0 Adjustment for Australian Content $1,220,000 ($400,000) $0 $0 $0 Less: CAPEX ($380,000) ($334,001) ($334,001) ($334,001) ($334,001) Less: Taxes ($185,435) $0 $0 $0 $0 Total Cash Flow $1,744,728 ($6,274,975) ($673,733) $1,113,156 $2,049,547 Exit Value (2) $26,644,116 Total Net Cash Flow $1,744,728 ($6,274,975) ($673,733) $1,113,156 $28,693,664 Cumulative Cash Flow $1,744,728 ($4,530,248) ($5,203,980) ($4,090,825) $24,602,839 Add: Sony Incremental License Fees (3) $363,375 $855,888 $898,875 $898,875 $898,875 SPE View $2,108,103 ($5,419,088) $225,142 $2,012,031 $29,592,539 Cumulative Cash Flow $2,108,103 ($3,310,985) ($3,085,843) ($1,073,812) $28,518,726 Channel SPE View Total Investment/DWM ($5,203,980) ($3,310,985) NPV of Cash Flows ($2,430,481) $647,995 NPV of Exit $17,174,396 $17,174,396 Combined NPV (2) $14,743,916 $17,822,391 (1) PPA currently assumed to be zero based on the premise that the average market participant would shut this business down - Sony is willing to carry on for strategic/synergy reasons. (2) Assumes 12% discount rate and 4% perpetuity growth rate. Exit value based on perpetuity growth calculation with assumed EBITDA5 multiple of 10.2x. (3) Incremental license fees assumes 75% of SET channel content will be SPE library content. Includes 15% for residuals and 40% in taxes. Risks and Opportunities

Risks Risk Mitigators Cannot agree on carriage terms for new Sony • Do not proceed with a channel launch at the branded channel with Foxtel moment, but instead delay a channel launch into the future (via a possible channel put) Cannot renew output deals with NBCU and CBS • A 3rd channel can help off-set any financial under agreeable terms impacts to a renewed licensing agreement • Stress notion that dissolving the TV1/SF partnership would lead to a dearth of buyers in the market New competition driving up prices for content • Long term output deals with key suppliers rights Not achieving estimated subscriber • Establish long term distribution deals fees/carriage from operators in later years Lower than expected ratings curb expected ad • Popularity of content and brands in the revenue growth marketplace • Ignite to continue providing ad sales going forward Competition from other channels entering • Proven programming expertise in international marketplace markets • Broad supplier relationships will enable SPT to secure exclusive rights to key titles New digital platforms emerging • TV1 and new Sony SET channel to be non- exclusive Overestimated cost reductions for TV1/SF/SET • Management expected to manage overhead in- line with plans or risk channel dissolution6 Next Steps

Finalize programming needs for the three channels – TV1, SF and SET

Deliver initial content licensing term sheets to NBCU and CBS

Review and provide counter to the SET channel carriage agreement provided by Foxtel

Discuss terms with NBC and CBS to purchase their stakes in the TV1/SF partnership

Negotiate and finalize all necessary licensing, content and purchase agreements

Deal approvals and RAD sign-off

Begin pre-launch procedures/expenditures for new SET channel in parallel to running TV1 and SF 2013

New channel launches Jan 1, 2014

7 APPENDIX

8 Sample “SET” Programming Grid

TIME Sunday MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY TIME 6am Movie Mad About You Movie 6am 630am Feature Just Shoot Me Feature 630am 7am Game Shows 7am 730am Drop Dead Diva The Good Wife, The Client List, Unforgettable, Necessary 730am 8am Mad About You Fairly Legal PAN AM Covert Affairs Roughness Mad About You 8am 830am The Young & The Days of Our Lives Days of Our 830am 9am Restless (8:40am) Lives 9am 930am (Weekly Catch-up) The Young And the Restless (Weekly Catch-up) 930am 10am (9:20am) 10am 1030am Talk Shows (e.g. Dr Oz, Kathy, Queen Latifah) 1030am 11am Mad About You and Just Shoot Me (10:50am) 11am 1130am Monk/Drop Dead Diva/Covert Affairs/Royal Pains/Necessary Roughness/ 1130am NOON The Client List/Nashville/PAN AM/The Good Wife/Fairly Legal/Unforgettable NOON 1230pm Necessary The Good Wife, The Client List, Unforgettable, Necessary 1230pm 1pm MOW Roughness Fairly Legal PAN AM Covert Affairs Roughness MOW 1pm 130pm Days of Our Lives 130pm 2pm 2pm 230pm Mad About You The Young And the Restless Mad About You 230pm 3pm Just Shoot Me Just Shoot Me 3pm 330pm Games Show Monk/Drop Dead Diva/Covert Affairs/Royal Pains/Necessary Roughness/ Games Show 330pm 4pm The Client List/Nashville/PAN AM/The Good Wife/Fairly Legal/Unforgettable 4pm 430pm Talk Show (e.g. Dr Oz/ Talk Shows (e.g. Dr Oz/ Kathy/Queen Latifah) Talk Show (e.g. Dr Oz/ 430pm 5pm Kathy/Queen Latifah) Kathy/Queen Latifah) 5pm 530pm Drop Dead Diva Game Shows Nashville, 530pm 6pm The Big C, Royal Pains 6pm 630pm Unforgettable, Mad About You The Client List/ 630pm 7pm Covert Affairs Just Shoot Me PAN AM 7pm 730pm Necessary Monk/Drop Dead Diva/Covert Affairs/Royal Pains/Necessary Roughness/ The Good Wife, 730pm 8pm Roughness The Client List/Nashville/PAN AM/The Good Wife/Fairly Legal/Unforgettable Fairly Legal 8pm 830pm Movie The Good Wife, The Client List, Unforgettable, Necessary Nashville, Movie 830pm 9pm Feature Fairly Legal PAN AM Covert Affairs Roughness The Big C, Royal Pains Feature 9pm 930pm Days of Our Lives 930pm 10pm (9.30pm) 10pm 1030pm The Young And the Restless 1030pm 11pm MOW (10.20pm) MOW 11pm 1130pm Talk Shows (e.g. Dr Oz, Kathy, Queen Latifah) (11.10pm) 1130pm MIDNIGHT Mad About You MIDNIGHT 1230am Unforgettable, Game Shows The Client List/ 1230am 1am Covert Affairs (12:25am) PAN AM 1am 130am The Young & The The Good Wife, The Client List, Unforgettable, Necessary Nashville, Days of Our 130am 2am Restless Fairly Legal PAN AM Covert Affairs Roughness The Big C, Royal Pains Lives 2am 230am (Weekly Catch-up) Monk/Drop Dead Diva/Covert Affairs/Royal Pains/Necessary Roughness/ (Weekly Catch-up) 230am 3am The Client List/Nashville/PAN AM/The Good Wife/Fairly Legal/Unforgettable (1.50am) 3am 330am Days of Our Lives 330am 4am (2:50am) 4am 430am The Young And the Restless (3:40am) 430am 5am Game Shows (4:30am) 5am 530am Just Shoot Me Talk Shows (e.g. Dr Oz, Kathy, Queen Latifah) (5:20am) Just Shoot Me 530am9 TV1-SF-SET Content Buy Summaries (CY) Consolidated Jul-Dec 13 2014 2015 2016 Total Only Total Title Hours CBS 613 595 566 1,774 201 Sony 808 706 649 2,163 90 NBC 599 265 505 1,368 103 Non-Studio 234 223 204 661 127 Total Hours 2,254 1,788 1,924 5,966 520

Total Title Buy Value $ CBS $7,235,558 $6,820,468 $5,925,508 $19,981,533 $2,528,700 Sony $5,387,953 $4,239,978 $3,767,818 $13,395,750 $660,500 NBC $5,682,710 $2,498,440 $6,000,530 $14,181,680 $1,010,350 Non-Studio $2,040,856 $2,358,580 $1,961,180 $6,360,616 $873,990 Total Dollars $20,347,077 $15,917,466 $17,655,036 $53,919,579 $5,073,540 TV1 Jul-Dec 13 2014 2015 2016 Total Only Total Title Hours CBS 423 395 323 1,141 126 Sony 84 137 93 313 22 NBC 325 77 317 718 42 Non-Studio 30 12 4 46 4 Total Hours 861 620 737 2,218 194 Total Title Buy Value $ CBS $6,058,100 $5,565,070 $4,429,455 $16,052,625 $2,116,200 Sony $936,800 $1,556,980 $1,083,675 $3,577,455 $286,500 NBC $3,590,550 $876,660 $3,748,040 $8,215,250 $432,600 Non-Studio $256,600 $137,080 $46,680 $440,360 $24,000 Total Dollars $10,842,050 $8,135,790 $9,307,850 $28,285,690 $2,859,300 SF Jul-Dec 13 2014 2015 2016 Total Only Total Title Hours CBS 154 163 182 498 75 Sony 81 106 154 341 68 NBC 152 144 144 440 61 Non-Studio 204 211 200 615 123 Total Hours 591 623 680 1,894 326 Total Title Buy Value $ CBS $859,458 $933,398 $1,059,053 $2,851,908 $412,500 Sony $684,320 $835,915 $1,159,810 $2,680,045 $374,000 NBC $1,098,160 $1,209,780 $1,840,490 $4,148,430 $577,750 Non-Studio $1,784,256 $2,221,500 $1,914,500 $5,920,256 $849,990 Total Dollars $4,426,194 $5,200,593 $5,973,853 $15,600,639 $2,214,240 SET Jul-Dec 13 2014 2015 2016 Total Only Total Title Hours CBS 36 38 61 135 - Sony 644 463 402 1,509 - NBC 122 44 44 210 - Non-Studio - Total Hours 802 545 507 1,854 Total Title Buy Value $ CBS $318,000 $322,000 $437,000 $1,077,000 $0 Sony $3,766,833 $1,847,083 $1,524,333 $7,138,250 $0 NBC $994,000 $412,000 $412,000 $1,818,000 $0 Non-Studio $0 $0 Total Dollars $5,078,833 $2,581,083 $2,373,333 $10,033,250 10