Simon Cowell Partnership Opportunities Summary

1. Summary of Simon Cowell Partnership Opportunities May 2009

2. NOTES FOR SPT INTERNAL DISCUSSION ONLY • Fall 2007 • Sony BMG began negotiations to form a JV with Simon Cowell, buying into his revenues streams (appearance fees and artist revenues) associated with American Idol, X-Factor, and other shows • At the time, SPE provided a high-level overview of opportunities to partner with Simon that could complement (but not drive) the Sony BMG deal, including: (1) TV Production, (2) Film Production, (3) Crackle, (4) GSN • Winter 2008 • We were asked to quantify the value of the TV/Crackle/GSN opportunities and estimated their value at $70-$100MM (see appendix A) • At this point, the TV production portion of the deal evolved from a small (e.g., $1.5MM overall deal) to a full blown JV with funding for several pilots per year • June 2008 • R. Wiesenthal updated us in detail on a Sony BMG proposal that was being made to Simon without SPE (see appendix B) • Today • We have been asked to update our list of partnership opportunities with Simon • The next 4 pages outline these opportunities and have been modified from the Fall 2007 version: • Eliminated the opportunity to receive equity in GSN (given 65% Liberty ownership) • Excluding quantification of opportunities until negotiations are further fleshed out (in prior iterations we were concerned about being asked to over-commit here)

3. Preliminary Proposal for an Overall Television Deal Sony Pictures Television Business Overview • SPT is the top independent studio for network and cable television • Creator and distributor of top comedies, dramas, and game shows: • #1 comedy of all-time (Seinfeld) • #1 primetime comedy last season (Rules of Engagement) • #1 daytime drama (Young and the Restless) • #1 and #2 game shows of all time (Wheel of Fortune and Jeopardy!) • #1 producer of TV movies, won 3 Emmys for Broken Trail this year • Broad range of on-air shows, including 10 network shows, 8 cable shows, 5 syndicated shows, and 6 made-for-TV movies • Industry leader in television distribution with records for shows like Seinfeld and King of Queens • Large ad sales organization with over $200MM in annual revenues Need to update these stats Deal Overview • Establish a JV with Simon and Sony Pictures Television • Provide Simon access to SPT’s drama and comedy writers as well as our creative executives • Cover multiple genres as well as scripted and non-scripted formats • Provide Simon screen credits including Executive Producer, Logo Credit, and paid ads Simon will tap into Sony Picture Television’s resources, industry leadership, and expertise to expand the range of his television offerings

4. Preliminary Proposal for an Overall Feature Film Deal Sony Pictures Overview Need to update these stats • Sony Pictures is Hollywood’s leading studio • #1 in openings (2006 & 2007) • #1 in market share (2006 & 2007) • #1 in opening day receipts / weekend receipts (Spider-Man 3) • 12 Best Picture Oscars Deal Overview • A multi-year first look deal with Columbia Pictures for all theatrical projects • Deal would cover Simon’s overhead and fringe • Deal would be non-exclusive for Simon with regards to production services / producer commitments • Pay-or-play for fixed compensation would be based on SPE’s election to proceed to production • Contingent consideration would be the same as existing deal at Columbia (“William Davies / Untitled Simon Cowell Project”) Simon will leverage Sony Pictures’ resources and feature film production expertise, providing Simon a vehicle to bring his theatrical projects to the screen

5. Preliminary Proposal for a Crackle-based Online Partnership Crackle Overview • Crackle is a premier destination for online video, focused on high-quality short-form video • Crackle is elevating the quality of online video and attracting the best creators of short-form video • Crackle has attracted a large and loyal audience, making it the ideal destination to extend Simon’s brand online • Crackle’s model is an ideal fit for identifying talent, with a brand built on offering fame-based incentives to emerging talent Deal Specifics • Sony would grant equity in Crackle as part of the venture • [Note: We should discuss. This was previously based on the assumption of Sony BMG funding a portion of EBIT losses] • Crackle would provide technology, infrastructure, and management team • Partnership would include marketing support and music video distribution • Simon would receive cash compensation for his services, including contribution of his expertise in developing the Network concept • Simon would contribute his name and likeness, public relations support, and on-going interaction with audience members [Note: Crackle partnership likely no longer about audience talent; less like Idol] With no cash investment, Simon would participate in creating the leading online destination for talent and extend his brand to a site that reflects his style of straight talk and celebrity

6. Preliminary Proposal for a GSN-based Game Partnership GSN Overview • Collaborate with Simon to build a game-based business around his brand • With the backing of Sony Pictures, Liberty Media, and new management, GSN is redefining its brand • GSN is building on its position as a leader in TV game shows (reaching 66MM households) to expand into online and casual games • GSN’s affiliation with Fun Technologies uniquely positions it to be the leader in games across platforms Deal Specifics • GSN would guarantee exclusive carriage for a defined number of Simon’s game shows each year (number of shows / format would be negotiated) • Simon would have a dedicated programming block one night per week • Simon, GSN, and FUN Technologies would collaborate in developing online skill-based games • Deal would build on Sony’s partnership with IGT and history of introducing the most successful gaming machines of all time to offer slot machines based on Simon’s game shows Leverage GSN and FUN Technologies to extend Simon Cowell’s brand into both television game shows and skill-based casual video games

7. Appendix A – Back-up from Fall 2007 / Winter 2008

8. Estimated Value Ranges (As of Winter 2008) Need to revisit Need to revisit Likely off the table Partnership opportunities with SPE would provide $70-100MM in equity plus additional income to Simon / Sony BMG

9. Reality Shows (e.g., America’s Got Talent, Cupid) Game Shows (e.g., Power of 10) TV Production Company Overview (As of Winter 2008) Content Focus Business Model • $7 MM annually required for development budget, 6 pilots (50% license fees covered by networks), and overhead in Year 1; growing to $12 MM by Year 5 • Only network shows assumed without need for deficit financing (i.e., no cable shows modeled) • Reality shows assumed to generate incremental revenue from sponsorship and format sales • Game shows assumed to generate incremental revenue from First Run Syndication, Advertising (syndication barter), and international format sales Organizational Structure • JV headed by Simon Cowell with 10 professionals in the first year growing to 20 professionals by Year 5 • Wholly owned by SCA and SyCo (50/50 JV) Key Success Factors • Pilot pickup rate throughout the plan period in line with industry averages (33%) • Successful first run syndication of best game shows (e.g., Who Wants to be a Millionaire) • Reality formats attract significant sponsorship ($20 MM/Year by Year 3) • NewCo earns all EP fees at 10% of production budget (60-85% of PV) PV of production company cash flows ranges from $45 MM to $100 MM driven by Simon’s ability to continue to create exciting television content

10. Year 1 to 2 • 60% • 30% • 27% • Reality Success • 2 • 2 • Year 2 to 3 • 50% • 67% • 61% • Reality Underperform • 3 • 2 • Year 3 to 4 • 67% • 50% • 67% • Game Show Success • 2 • 3 • Game Show Underperform • 3 • 3 Slate Assumptions (As of Winter 2008) General Assumptions • 6 pilots per year with a 33% pick-up rate for both reality and game shows • Mix of successful (3+ seasons, syndication and format sales) and under performing (average 1-2 seasons, limited sponsorship, no syndication) game show and reality programming • 100% network shows with license fees equal to production budgets • Successful shows reach steady state economics in Year 3 Case Specific Assumptions • Success Rates • Overall Programming Mix* • Aggressive Case • Base Case • Industry Average • Aggressive Case • Base Case • Show Type • *Numbers represent picked-up shows

11. American Idol Revenue Estimate (June 2008) Note: Slide provided to R. Wiesenthal but does not directly factor into our rough estimate of a $45-100MM value for a potential production JV with Cowell • Of the estimated $745m of revenue, it is unclear as to how much is paid to the producers and how much is retained by Fox. • Traditionally, a broadcast network will pay for 100% of the production costs and not share ad sales, sponsorship or other revenue with the producers • Given the extreme success of AMERICAN IDOL, it is reasonable to assume that Fremantle has been able to negotiate an enhanced deal where they share in Fox’s revenue streams. It is unlikely that this information is easily obtainable from either Fremantle or Fox as it is highly confidential. (a) Network ad sales based on 2007 AMERICAN IDOL rate card per Neilsen Ad Views of $855m gross less 15% agency fee. (b) Sponsorship based on internal SPT estimate. $20m believed to be amount of Coke sponsorship. • *Numbers represent picked-up shows

12. Preliminary Proposal for an Overall Feature Film Deal Key Deal Terms • Two year, first look term deal plus producing services agreement • Overhead of $250K per year (plus fringe, insurance, benefits, rent, etc) for term deal • Non-exclusive, first-priority services as producer for selected motion picture projects through Columbia Pictures Deal Specifics • Term Deal • Columbia Pictures to have First Look at all theatrical projects owned or controlled by Simon • Overhead of $250k per year for one development executive plus two assistants at customary Term Deal rates/benefits. Additional fringe, insurance, other annual costs covered at estimated $250k • Producing Services (with respect to projects that Simon is attached to produce) • Customary development services for production of motion pictures selected by Columbia Pictures include non-exclusive, first priority (for theatrical projects) services as producer for the period commencing eight weeks prior to the scheduled start of principal photography and continuing until completion of principal photography. At all other times, services shall be rendered on a non-exclusive basis. • Simon shall be pay-or-play for his fixed compensation upon Columbia Pictures election to proceed to production • Contingent consideration shall be the same as existing deal at Columbia (“William Davies / Untitled Simon Cowell Project”) Simon will leverage Sony Pictures’ resources and feature film production expertise, providing Simon a vehicle to bring his theatrical projects to the screen

13. Appendix B – Last Sony BMG Proposal to Simon Cowell(June 2008)

15. Syco 3.0Unique Advantages of Partnership With SONY BMG Begins Now! …Not In 2011 Immediate Profit Share In Syco and Ronagold Assets SONY BMG Committed to Invest Required Funds to Achieve JV Goals Exchange Opportunities With All U.S. Labels and Key Territories Continuity of Established SONY BMG Relationships Around the World U.S. Switzerland Poland Taiwan Mexico Canada Sweden Hungary Korea Central America UK/Ireland Austria Turkey Hong Kong U.S. Latin France Denmark Russia Indonesia Brazil Germany Norway South Africa India Argentina Belgium Finland Australia Singapore Chile Netherlands Greece New Zealand Thailand Colombia Italy Portugal Japan Malaysia Ecuador Spain Czech Republic China Philippines Venezuela Important Relationships With SONY BMG Parent Companies

16. Syco 3.0 – New Improved Proposal • JV Beginning Now! …Not In 2011 • Effective January 1, 2008, SONY BMG contributes ~$200M of Syco and Ronagold assets and Pop Idol override • 50% of asset value given to SC, now and ongoing • SONY BMG makes $200M flat payment to SC • $100M on signing • $34M in 2010 • $66M in 2015 (or earlier if thresholds are met) • 50% share of JV profits from January 1, 2008 thru 2015, worth est’d $296M • Additionally, SONY BMG to fund all JV productions and investments Forecast SC income: Flat payments $200M + Est’d profit $296M Total $496M Note: all other terms as before

17. New Improved Proposal Vs. Prior Offer Improvements • Additional $66M On Signing • Was $34M, now $100M • Interest benefit to SC est’d at $10M • Additional $18M Profit Share • 50% Profit Share In 2008 & 2009 (Was 25%) • Additional $28M in post-tax profits to SC • Accelerate Final Flat Payment and Profit Share When Threshold Achieved Vs. All In 2015

18. Income Projections: New Improved Proposal SC* SONY BMG Worldwide Income Pre Tax Income ($ In Millions) Post Tax Income ($ In Millions) * Includes $200M Flat Payment

19. SC Pre Tax Income Projections ($ In Millions) SONY BMG Opportunities Are Far Greater Than Any Competitive Offer $619M with $600 50% Participation In Valuable Asset Portfolio $557M SC Pre Tax Income $500 $496M Understanding of Competitive Offer $400M $400M $400M $400 100% 125% 150% Forecasted Income: % of Base Case Our Unprecedented Success to Date Is the Foundation to Build A $1 Billion Media Empire

20. Shared Ambition to Build A $1Billion Media Company Refocus SONY BMG Organization to Maximize Exploitation of Syco Assets • Add Resources to Coordinate Global TV Activities • Appoint Dedicated SBMG Global Brand Executive Focused On Syco Business • Responsibilities Include Endorsements, Branding, Sponsorship, Online, Games, Film, Music Publishing, Etc • Create International Structure to Focus On Local Territory Syco Exploitation • Assemble Biannual Meeting of Key Global SBMG/Syco Executives to Brainstorm Opportunities, Develop Plans for Execution Grow Current TV and Recorded Music Business • Establish LA Presence With Necessary Resources In TV and A&R • Expand In-House TV Producer Team to Deploy On Key Productions • Increase Global Marketing and A&R Resources Accordingly Expand Into New Business Areas • Aggressively Pursue New Business Opportunities • Commit to Provide Funding for Diversification Into New Media Sectors

22. SONY BMG Assets Created Together Il Divo The X Factor Shayne Ward Jordin Sparks Will Young Daughtry Leona Lewis Westlife Carrie Underwood Gareth Gates Christophe Willem Got Talent Kelly Clarkson Anthony Callea Taylor Hicks David Cook Six Clay Aiken Damien Leith Robson & Jerome Mark Medlock Elliot Yamin Five Guy Sebastian Amel Bent Kellie Pickler Paul Potts Shannon Noll American Inventor Michelle McManus Fantasia Barrino Ruben Studdard

23. Leona Lewis: Most Recent Syco/SONY BMG Global Success Debut Album Already Gold or Platinum in 17 Territories; 4M Units Spirit • Fastest selling UK debut album ever (375,000 copies in first week) • Entered US Billboard 200 at #1 - first British solo artist to achieve this with debut release Bleeding Love • Best selling UK single of 2007 • First #1 US single by UK female in over 20 years • Only the second single to ever fall out and return to the number one position on the Hot 100 twice #1 Top Selling Global Album In 2008

24. Tax Appendix 24

25. Major New Tax Development • Create New English Limited Liability Partnership (LLP) • SC Will Be Partner In LLP and Furnish Services As A Partner • $200M Flat Payment – 18% Tax Rate for SC Vs. Significant Risk of 41% Rate In Option 3 New Tax Structure • 100% Capital Gain Benefit to SC • Partial Tax Benefit to SONY BMG • SC Profit Share – 40% Personal Tax Rate Vs. 46% Corporate Rate • Lower National Insurance Costs for JV • Significantly Less Risk of Tax Audit for SC See Tax Appendix for Further Details

26. Current Status SBME - UK Simon Cowell (SC) Royalty Free License Royalty Free License SIMCO Simon Current Employment Contract Ronagold Assets Including Intellectual Property and Goodwill

27. Preliminary Step • Ronagold and SIMCO Give Notice to SBME-UK to Terminate Current Royalty-Free License SBME - UK SC Adjusted License Adjusted License SIMCO Simon Current Employment Contract Ronagold Assets Including Intellectual Property and Goodwill

28. Venture Formation • SBME-UK and SC Incorporate A 50/50 English Limited Liability Partnership (LLP) and Make Nominal Capital Contributions (£50K) • Initially LLP Could Be Formed Internally Within SBME-UK • SBME-UK and LLP Enter Into Secondment Agreement Under Which SBME-UK Employee Seconded to LLP On A Part-Time Basis (Employee Will Report to SBME-UK and SC) and Employee Would Invest Capital In Short-Term Interest Bearing Intra-Group Loans • SBME-UK, SC and LLP Enter Into Joint Venture Agreement Pursuant to Which: • SBME-UK Contributes Its Shares In Ronagold and SIMCO to the LLP As A Gift • SBME-UK Contributes to the LLP As A Gift Up to $200 Million In Three Tranches (i.e., $67 Million Day 1, $67 Million 2010 and Up to $66 Million In 2015 If Earn-Out Conditions Are Met) • SC Sells His Intellectual Property For Up to $200 Million (i.e., $67 Million Payable Day 1, $67 Million 2010, and Up to $66 Million In 2015 If Earn-Out Conditions Are Met) • SBME-UK and SC Agree to Adapt A New LLP Agreement Containing the Terms On Which the LLP Will Be Managed by SBME-UK and SC and Under Which SC Agrees to Devote Substantially All of His Time to A&R On Behalf of the LLP On An Exclusive Basis Until 2015 • SC and SIMCO Agree to Terminate SC’s Current Employment Contract

29. Venture Formation $200 Million $200 Million SBME - UK Simon Cowell 50% 50% Licenses LLP 100% SIMCO IP Ronagold

30. Structure Tax Advantages • SBME-UK Should Be Directly Entitled to Amortize 50% of the Cost to the LLP of the Intellectual Property and Goodwill Acquired by the LLP From SC • Simon's Ability to Claim 18% Tax Rate On the Receipt of $137 Million Plus the Net Present Value of $66 Million Substantially Improves As Compared to Simon's Current Maidmetal Proposal • As A Matter of English Law, SC Should Be Deemed A Partner and Not An Employee • SBME-UK Saves Stamp Duty Costs ($1 Million) Since It Is Not Required to Acquire SC’s Shares In Maidmetal