1. TitleHBO Latin America Group Presenter (Division) Sony Pictures EntertainmentAttendees Dave Hendler, Andy Kaplan, John Calkins, Drew Shearer, Jim Underwood Sold asset/ Transferred business HBO Latin America GroupTransfereeTime Warner Entertainment Sales Amount, Book value Sales amount, Latest plan (Budget: Yes / No ) Acquisition costBook valueFair Market Value / Reference price $217 Million$45.2 Million$29.8 MillionOku \ ScheduleInvestment CommitteeGp Exec Committee or Elec Mgt Committee Sale /Transfer date (plan) Date: 01 / 20 / 2010 Date: NA February 2010 Purpose / Background SPE is seeking approval to sell 21.2% of HBO Latin America Group (LAG) and certain voting rights to Time Warner Entertainment (TWE) and to enter into a put agreement for the 8.2% equity interest retained by SPE post closing. Definitive documents are expected to be signed in February 2010. The GEC delegated approval for this transaction to the CFO on October 7, 2009, subject to two conditions: (1) obtaining a minimum 100% valuation of $680MM (transaction will have a 100% valuation of $950MM) and (2) retaining a board seat if SPE continues to hold a 10% equity interest. Both of these conditions have been met with the proposed transaction. Sale/Transfer Summary 1.Transferee’s profile and credit rating TWE has a market capitalization of $33BN, is traded on the NYSE (ticker: TWX), and is listed on the S&P 100. TWE had revenues of $47BN in CY08 and $7BN of cash on hand as of 9/30/09. TWE’s current credit rating is ‘BBB.’ 2.Buyer (transferee) selection process TWE owns the HBO and Cinemax brands in the U.S. and in other markets around the world and seeks to further increase its ownership of HBO LAG. Post closing, TWE would have an 80% stake in HBO LAG, with the remainder held by Ole Communications (11.8%) and SPE (8.2%). 3.Terms and conditions for payment $201MM relating to the sale of the 21.2% equity interest will be paid at close. Payment of $15.6MM related to the sale of SPE voting rights is subject to approval of the competition filing in Brazil and is likely to be made in FYE 11. 4.Costs relating to the transaction (incl. obligation / indemnity, HR expenses to be borne by Sony) SPE is not anticipating any material costs relating to the transaction. 5.Financial impact and merit / demerit (P/L, B/S, C/F, tax) The combined sale of the 21.2% equity interest and voting rights will generate an estimated gain of $185MM. Accounting for the FYE 10 gain is being finalized. Preliminary guidance is that a gain of approximately $172MM relating to the sale of the equity interest will be recognized in FYE 10. The put will have an initial strike price of $62.3MM and will increase 5% per year for 5 years. After 5 years, the put will be valued at 6.6% of HBO LAG’s fair market value. With the transaction, the historical IRR of SPE’s investment is approximately 27%. Contacts NameJohn CalkinsDivisionSony Pictures Entertainment Tel310-244-2929Fax310-244-0484e-mailjohn_calkins@spe.sony.com Investment Committee Application (for asset sale, business transfer incl. stock sale) No. Contact: Investment Committee Secretariat Tel. +81-3-6748-2307 (Ext.9-308-2307) e-mail. gh-keiki-toushi@jp.sony.com