HOME ENTERTAINMENT PEGASUS/SAP FINANCIALS October 28, 2013

Executive Summary Business Problem:  Our business model is changing – all future distribution and finance/back-office options require a direct interface into SAP, consistent with the international model, that serves as the single, global, system of record where the financial close occurs and enterprise data is managed  Currently, we have a two-system JDE/SAP structure which creates organizational/headcount and reporting inefficiencies preventing the utilization of the SGBS where the benefits of higher controls and lowered cost are not being realized  A highly customized version of JDE (“Pegasus”) used to support these functions is targeted for replacement or upgrade/re-implementation at an estimated of cost $4.7mm (per 2009 Copper Study) 2

Proposed Solution 1.Carve out the Pegasus general ledger from DHE and utilize SAP for financial transaction processing, period end close, and enterprise data management 2.Leverage the existing international process and system models for Domestic Home Entertainment 3.Transition AP, MDMA, Inventory, GL, and IT related activities to financial shared service centers in Gdansk and Manila to achieve labor arbitrage 3 Please note that (a) this work will be required when SPHE outsources its Order-to-Cash process, enabling SPE to retire Pegasus and fully leverage the SAP environment and (b) was in scope in the original SAP implementation in 2005 but was excluded due to complexity and time required to implement.

Competitive Analysis What are other studios/corporations doing to address this issue? 4 SAPJDE Sony Pictures Entertainment SPE – Domestic Home Entertainment SPE – International Home Entertainment Warner Bros. Walt Disney NBC Universal Paramount Lionsgate MGM 20 th Century Fox

Financial Summary 5

Net Benefits Category$ BenefitDescription FTE Savings$608,428 Reduction of 13 Finance FTE offset by increase of 9 Shared Service Center FTE and 1 SAP Support FTE Cost Avoidance$818,000 Retirement of Data Serve and Pegasus Systems 6  Increased standardization and alignment with Corporate processes  Increased visibility to transactional details by Corporate  Elimination of duplicative processes and data by DHE  Reduction of risk and control issues

Timeline 7  Shared Service Center activities would begin in May 2014  Activities would be comprised of recruiting, training development, knowledge transfer, in territory training, and stabilization.  Total transition duration would be approximately 4 months post go-live.