GSN: Initial Hypotheses and Next Steps April 18, 2008

1 New information provided by management indicates that the benefits of integrating GSN and FUN accrue to GSN under both the merger and partnership scenarios Most merger synergies accrue to FUN technologies and assume significant growth as well as the development of a new business model (Free Games) Based on the information provided, SPE should simply retain its interest in GSN rather than investing FUN and pursuing a merger Information Provided by Management Suggests GSN Will Receive FUN Integration Benefits Even Without Merger

2 Non-Merger will reduce the ability of GSN and FUN executives to seamlessly coordinate (e.g., no co-location, increased difficulty in selling multi-platform buys to advertisers) Non-Merger will require duplication of some assets and key personnel thus reducing potential cost synergies Asset Duplication Coordination On a Practical Basis However, GSN Would Require Merger to Maximize Integration Benefits Potential Lost Value Under Partnership Model Decision to merge will be informed by quantifying the true cost implications of a partnership and an analysis of FUN EBITDA growth projections

3 Ad Sales –Reduced CPM rates –Reduced multiplatform sponsorships –Shift ad mix away from direct response Asset Duplication Coordination Potential Levers Marketing Spend Effectiveness –Show specific marketing –Other marketing spend Headcount –Increased FTE cost for second management team Facilities –Increased facilities cost driven by ending co-location of GSN/FUN management Hypotheses Partnership will limit opportunities for multiplatform ad buys which yield higher CPMs Impact with Strawman Assumptions ($MM 2010 EBITDA) $1-$3MM (TBD for sponsorship and ad mix) Increased marketing cost driven by lost purchasing scale and customer acquisition synergies $0.5-$1MM Additional management team required once GSN/FUN are de- merged $0.5-$1.5MM Additional management team required once GSN/FUN are de- merged GSN Income from FUN –Licensing revenue –Ad sales rev share Licensing and ad sales relationships structured at arms length and unlikely to change under partnership $0MM Initial Hypotheses Regarding Lost GSN Value Under a Partnership Model Total Likely Impact on 2010 EBITDA $ MM +TBD $0.1-$0.2M

4 Preliminary Analysis of the Partnership Model With Strawman Assumptions Suggests Lost Value to SPE Share of GSN Would Be Less Than $50MM CPM Growth: Reduce all CPM growth rates by 50% Marketing Spend: Increase by 5% (excluding re- brand) Management Headcount: Hire second management team (8 FTE) Facilities Cost: Increased office space and related expenses for second management team at $120K per year AssumptionsImpact Lost Value to GSN Under Partnership GSN Case Valuation: $486.8 M SPT Case Valuation: $415.2 M $35.8 M All other drivers constant Total Lost Value: $71.6 M

5 However There Are Additional Levers Which May Impact GSN Value Under a Partnership - Drivers Flexed in Strawman Analysis Potential Levers

6 More Work is Required to Validate Model Assumptions How will CPM rates be affected by loss of multiplatform offering? Ad Sales Key QuestionsProposed ApproachTiming Affiliate Sales Program Development and Amort. Operating Expenses Are lucrative sponsorships at risk under a partnership scenario? Will management be able to shift the ad mix away from D.R. without FUN? Interview SPT ad sales team to gauge likely market response to loss of integration with FUN Analyse Q1 ’08 actuals for evidence of sponsorship growth driven by FUN integration Review ad mix strategy and implications with GSN management Confirm hypothesis of negligible impact on subscriber rates and sub fees Confirm and validate the specific marketing synergies that are listed in aggregate in the GSN/FUN management projections Finalize incremental headcount required under partnership model Identify incremental facilities costs and asset leasing required under partnership Request submitted to GSN for detailed backup—awaiting response Determine reasonable salaries based on SPE actuals Identify actual costs based on GSN current leases and gross-up based on headcount analysis Interview affiliate experts (SPT Research, IBB, FEARnet execs) Confirm hypothesis of negligible impact on programming economics (e.g. acquisitions, development, pilot pick-ups) Interview GSN Development team and/or SPT Production and Programming Week of April 21 Upon receipt of Q1 ’08 actuals from GSN Week or April 21 Upon receipt of data from GSN Week of April 14 Week of April 21

7 For SPE to Lose No More Buying FUN Than It Would Under The Partnership Model, FUN Revenue Must Increase at a CAGR of 8.9% Over The Plan Period Worldwinner (FUN Games) Historical Revenue FUN acquisition valuation: 13.8% Acquisition cost to SPE: FUN DCF Value at 8.9% Revenue CAGR : $200MM ($100MM) $128.4MM SPE Share of DCF Value $64.2MM Net SPE Investment Loss ($35.8MM) Note: Due to acquisitions 2007 revenue increased 314% over excluded from CAGR calculation as it is not indicative of organic growth in the business

8 Given the Estimated Impact of Lost GSN Synergies, FUN Valuation Will Likely Determine Merger Attractiveness GSN/FUN Valuation Under Multiple Scenarios At 8.9% EBITDA growth and a $200MM acquisition valuation, FUN would represent a $36 MM loss to SPE $36MM is equal to the expected lost GSN value under a partnership model * * SPT Strawman case introduced on pg. 4 FUN acquisition is accretive for SPE only if revenue CAGR exceeds 8.9% over the plan period**

9 Next Steps 4/214/285/55/12 Business Diligence – Develop financial model based on senior management input – Submit and receive incremental diligence request Legal Diligence – Gather priority documentation – Review priority documentation – Visit and review Boston data room – Finalize model assumptions and assess impact – Finalize legal diligence and develop recommendations Present findings to Mosko If findings suggest merger… Prepare legal documentation Prepare and submit deal for GEC review If findings suggest partnership… Structure arms length agreements between GSN and FUN Develop roadmap for separation of operations (e.g. management team, facilities) 3-4 weeks to determine at an SPT level if we want to buy or partner with GSN 2-3 months to formalize merger or partnership Review model with Carey, Shearer and Calkins