CONFIDENTIAL Korea Distribution Partnership Opportunity February 2010.

CONFIDENTIAL

Korea Distribution Partnership Opportunity

February 2010

Executive Summary

• SPE has been approached by Korea’s Lotte Entertainment to distribute SPE films in Korea and Vietnam

– Seeking theatrical rights in Korea and Vietnam, video rights in Korea only– SPE would retain all TV rights

• While Korea is a growth market, significant competitive barriers exist– Majority of market is controlled by large, vertical monopolies– Local film quotas have led to a strong local film production market, with Korean films often

accounting for 50% or more of the box office in a given year

• Terms offered by Lotte represent an opportunity to secure a guaranteed profit stream in Korea above historical averages

– Lotte’s unegotiated offer exceeds our 4-year average and we would seek to negotiate the guarantee upward toward a guarantee that exceeds performance in our best years

– Guaranteed even in years without a Spider-Man or 2012 to drive territory performance– Many smaller SPE titles are not theatrically released. Additional releases and box office from SPE

titles could drive value in TV market, which is retained by SPE

• Opportunities may exist with other Korean distributors, such as CJ

Lotte Entertainment Overview

• The Lotte Group is a large platform of consumer oriented businesses– One of Korea’s largest conglomerates, with 2009E group revenues of $42B+– Multiple brands across shopping, tourism, restaurants, and theme parks

• Lotte Entertainment is one of Korea’s largest exhibitors– 2nd largest exhibitor, with a 23% share of screens in Korea (all digital multiplexes)

• 54 sites / 411 screens in Korea (projected to grow to 68 sites / 514 screens in 2010)• 3 sites / 17 screens in Vietnam

• Lotte continues to grow and has experience with market-leading films– 3 of the top 10 films in 2009– Market share increased from 8.4% in 2008 to 20% in 1H 2009– Experienced in distributing Hollywood titles, with successful releases of Terminator:

Salvation, The Golden Compass and Journey to the Center of the Earth (3D)

SPE Economics in KoreaSPE Korea Performance FY07 - FY10 by Slate Year ($M)

FY 2007 Slate FY 2008 Slate 4-year Average

Title Korea BOKorea

Theat. NetKorea Video

netVietnam

Theat. Net Total Title Korea BOKorea


netVietnam

Theat. Net Total Annual Th & Video Contribution 12.2 RV na - 0.0 - 0.0 SPIDER-MAN 3 34.1 12.6 0.4 - 13.0 Korea Office OH (1.0) DA VINCI CODE, THE 21.9 7.3 0.5 - 7.7 VACANCY 0.0 (0.0) 0.0 0.0 0.0 Net Contribution 11.2 CLICK 2.4 (0.2) 0.1 - (0.0) SUPERBAD na - 0.0 - 0.0 MONSTER HOUSE 7.8 2.0 0.2 - 2.3 30 DAYS OF NIGHT na - - - - TALLADEGA NIGHTS na - 0.0 - 0.0 THIS CHRISTMAS na - - - - COVENANT, THE 0.0 (0.0) 0.0 0.0 0.0 WALK HARD: THE DEWEY COX STORY na - - - - GRIDIRON GANG na - 0.0 - 0.0 FIRST SUNDAY na - (0.0) - (0.0) ALL THE KING'S MEN 0.0 (0.0) 0.0 - (0.0) VANTAGE POINT 7.0 1.6 0.1 (0.0) 1.6 MARIE ANTOINETTE 0.1 0.0 0.0 - 0.1 21 0.7 0.1 0.0 - 0.1 RUNNING WITH SCISSORS (TS) na - - - - PERFECT STRANGER 0.0 (0.0) - - (0.0) STRANGER THAN FICTION na - 0.0 - 0.0 SURF'S UP 1.9 (0.7) - - (0.7) CLICK 2.4 (0.2) 0.1 - (0.0) WATER HORSE 0.6 0.1 - - 0.1 PURSUIT OF HAPPYNESS, THE 4.0 0.7 0.2 - 0.8 GHOST RIDER 2.6 0.1 0.2 0.1 0.3 REIGN OVER ME 0.0 (0.0) 0.0 - 0.0 CASINO ROYALE 7.2 0.8 0.5 0.0 1.4 OPEN SEASON 1.9 (0.9) - 0.0 (0.9)

Annual Theatrical & Video Contribution 11.2 Annual Theatrical & Video Contribution 14.1 Korea Office OH (1.0) Korea Office OH (1.0) Net Contribution 10.2 Net Contribution 13.1

FY 2009 Slate FY 2010 Slate*

Title Korea BOKorea


netVietnam

Theat. Net Total Title Korea BOKorea


netVietnam

Theat. Net Total

PROM NIGHT na - 0.0 0.0 0.0 OBSESSED na - 0.0 - 0.0 MADE OF HONOR 0.1 (0.2) 0.0 - (0.1) ANGELS & DEMONS 10.2 2.2 - 0.1 2.2 YOU DON'T MESS WITH THE ZOHAN na - 0.0 - 0.0 TAKING OF PELHAM 1 2 3, THE 1.9 (0.6) - 0.0 (0.6) HANCOCK 18.0 5.1 0.1 0.0 5.2 YEAR ONE na - 0.0 - 0.0 STEP BROTHERS na - 0.0 - 0.0 UGLY TRUTH, THE 2.0 0.0 - 0.1 0.1 PINEAPPLE EXPRESS na - 0.0 - 0.0 JULIE & JULIA 0.2 0.0 - - 0.0 THE HOUSE BUNNY na - 0.0 - 0.0 ZOMBIELAND na - - - - NICK AND NORAH'S INFINITE PLAYLIST na - 0.0 - 0.0 STEPFATHER na - - - - LAKEVIEW TERRACE na - 0.0 - 0.0 MICHAEL JACKSON'S THIS IS IT 0.8 (0.3) - (0.0) (0.4) QUARANTINE na - 0.0 - 0.0 2012 33.8 11.6 0.2 0.3 12.1 SEVEN POUNDS 1.0 (0.4) 0.0 - (0.4) ARMORED na - - - - NOT EASILY BROKEN na - - - - DID YOU HEAR ABOUT THE MORGANS? 2.7 0.5 - 0.0 0.5 PAUL BLART: MALL COP na - 0.0 - 0.0 LEGION 0.0 (0.0) - 0.1 0.0 UNDERWORLD: RISE OF THE LYCANS 0.2 0.0 - - 0.0 DEAR JOHN na - - - - INTERNATIONAL, THE 1.0 (0.5) - - (0.5) BOUNTY HUNTER 3.1 0.7 - - 0.7 FIRED UP na - - - - DISTRICT 9 5.4 1.4 - - 1.4 QUANTUM OF SOLACE 10.1 2.4 - - 2.4 CLOUDY WITH A CHANCE OF MEATBALLS4.6 0.7 - - 0.7

Annual Theatrical & Video Contribution 6.5 Annual Theatrical & Video Contribution 16.9 Korea Office OH (1.0) Korea Office OH (1.0) Net Contribution 5.5 Net Contribution 15.9

*FY10 unreleased titles included at greenlight/budget estimates for Korea.

Lotte’s Proposed Terms of Output Deal

Studio: Sony Pictures Entertainment (all labels)

Distributor: Lotte Entertainment

Term / Fee: 5 Years / $12M per year

[Note: SPE would plan to counter for a higher guarantee]

Titles: • SPE must submit all titles under all labels to Lotte, with a minimum of 23 titles per year

• Lotte must distribute a minimum of 15 titles per year

Rights / Territory:

• Theatrical, and home video in South Korea

• Theatrical rights in Vietnam

•[Internet rights – IPTV, Internet VOD and Internet Streaming – were initially requested but we believe can be eliminated from the deal]

First Look: • SPE would get “first look” at any Lotte Korean product for purposes of English Language remake

Next Steps

• SPE senior management agreement to proceed or pass

• Assuming interest:– Agree on key terms to include in counter

• Increased annual guarantee• Up-front payment structured to allow immediate gain recognition (requires input from

technical accounting)• Define a subset of films Lotte must take (eg, number of puts or triggers for automatic

acceptance)• Ability to license/sub-distribute any rejected films, or non-theatrical product

– Alert David Bishop, Steve Mosko, and Keith LeGoy that we plan to engage formally– Express interest to Lotte and provide counter– Initiate discussions with CJ as an alternative

• TV has relationship with CJ, Korea’s largest distributor• CJ has recently done an all-markets deal with Paramount and is rumored to be

interested in further Studio deals

CONFIDENTIAL Korea Distribution Partnership Opportunity February 2010.

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