CONFIDENTIAL

Imageworks Opportunity

March 2010

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Potential Imageworks Sale Opportunity

• SPE has been approached by two parties interested in acquiring Imageworks

– 2007 Value was estimated at $70 to $90MM; current value may be lower as FYE2008 and FYE2009 earnings were negative

– Henry Gong was introduced to Rob Wiesenthal by Goldman Sachs and is interested coordinating a deal lead by Chinese firm TellHow

– CCL is a privately held media and entertainment company operating in India that previously approached SPE about buying Imageworks back in September 2009

• Since the last sales process, Imageworks has made significant progress

– Imageworks has reduced its non-billable cost structure by over 70% since FY08

– SPA saves ~ $20 to $30 mil per film by using Imageworks vs. external suppliers

– Imageworks has developed expertise in 3D and gives SPA and Columbia a dependable supplier

• SPE needs to determine whether to proceed or pass, and if proceeding, to structure a deal that retains strategic benefits

– Target percentage to sell and sale price

– Determine contractual relationship for services that guarantees low cost

– Secure access to dedicated resources

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• Privately held

• Film production and post-production services in India and the UK with an apparent focus in animation

• TV production services in India

• 9 radio stations in India

• Media services, e.g., ad sales, corporate branding, ad production, in India

• Acquired majority stake in Men-From-Mars, a London-based boutique post production facility, in 2007

• Acquired majority stake in London-based Molinare, the largest privately held post production facility in the UK, in 2007

Ownership

Key Business Strategies

• Leverage cost arbitrage opportunities (e.g., tax breaks, cheap labor) in India and the UK to offer low cost production and post production services to the US and Europe

• Source new business and expand operations through investments and acquisitions

Recent Events

Primary Lines of Business

Century Communications Limited, a privately held media and entertainment company with operations in India and the UK, has expressed interest in acquiring Imageworks

• Looking to acquire a sizable US west coast facility to base “high end operations” and source additional production projects

Interest in Imageworks

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Gong’s partners have expressed interest in both Imageworks and SPA

• If acquiring stakes in both Imageworks and SPA, Gong would create a consortium of investors including:

– Gong as an principal investor

– TellHow as an operating business (a subsidiary of Tsinghua Tongfang, a Chinese firm with IT and energy holdings)

– Financial backers, potentially including Thomas H. Lee

• For an Imageworks only deal, TellHow would lead and is open to acquiring a 51% to 100% stake with long-term relationship with SPE

– All cash deal for 51% to 100% of Imageworks

– Driven by TellHow with co-investment from its financial partners

– Relocation of production work, including required staff and facilities, to China

– Retention of North American base to develop technologies and expertise

– Long term services contract with SPA

– Desire to explore an IPO in Hong Kong with funds used for eventual international expansion

page 5CONFIDENTIAL

APPENDIX

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Current value considerations relative to 2007 value

Imageworks ValuationImageworks Valuation

• Argue for similar value based on forward EBITDA roughly comparable to values in 2007

• Downward pressure would be driven by

– 24% decrease in public market values since 2007

– Significantly lower trailing EBITDA

($ mil)

1) Forward EBITDA based on available information at the time of analysis (7/2007). Forecast years include FY08, FY09 and FY10

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Preliminary Gain Estimate

Potential Gain on Sale of ImageworksPotential Gain on Sale of Imageworks

($ mil)

* Assumes SPE's basis is after deducting $1.8MM for Frameflow's 25% non-controlling interest in Imageworks India.  Need to validate that Frameflow's stake would remain intact as part of the sale and not be liquidated

Low High Low High

Sale Value $70.0 $90.0 $35.7 $45.9

Less: Cost Basis* $5.6 $5.6 $2.9 $2.9

Gain to SPE $64.4 $84.4 $32.8 $43.0

100% Sale 51% Sale

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Imageworks Historical and Projected P&L

(figures in millions) Projected3/31/2004 3/31/2005 3/31/2006 3/31/2007 3/31/2008 3/31/2009 3/31/2010 3/31/2011 3/31/2012 3/31/2013

FY04 F05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13

Revenues $143.024 $119.254 $214.658 $202.727 $146.470 $137.491 $182.714 $155.000 $155.000 $155.000 % Growth -16.6% 80.0% -5.6% -27.8% -6.1% 32.9% -15.2% 0.0% 0.0%

EBIT $12.957 ($7.400) $14.062 $7.950 ($30.497) ($40.215) $9.000 $1.250 - - D&A $7.583 $7.875 $10.555 $12.523 $14.276 $13.915 $11.608 $11.367 $10.209 $9.820

EBITDA $20.540 $0.475 $24.617 $20.473 ($16.221) ($26.300) $20.608 $12.617 $10.209 $9.820 % Growth -97.7% 5082.5% -16.8% -179.2% 62.1% -178.4% -38.8% -19.1% -3.8%% Margin 0.4% 11.5% 10.1% -11.1% -19.1% 11.3% 8.1% 6.6% 6.3%

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Imageworks Historical and Projected P&L as of July 2007

(figures in millions)

3-Year March 31, Average 2005 2006 2007 NFY (2008) NFY + 1 (2009) NFY + 2 (2010)

Internal Revenue $126.730 $70.316 $161.948 $147.925 $61.092 $131.904 $84.661

Third Party Revenue $53.817 $48.938 $52.710 $59.802 $108.254 $38.095 $90.339

Reported Revenue $180.546 $119.254 $214.658 $207.727 $169.346 $169.999 $175.000

Revenue Growth % -16.6% 80.0% -3.2% -18.5% 0.4% 2.9%

Less: Cost of Goods Sold 111.981 195.075 189.173 152.885 145.793 142.818

Gross Profit $7.273 $19.583 $18.554 $16.461 $24.206 $32.182

Gross Margin % 6.1% 9.1% 8.9% 9.7% 14.2% 18.4%

Less: Selling, General & Administrative 14.673 5.521 10.604 18.461 24.206 27.057

Less: Other Operating Expenses - - - - - -

Add: Depreciation & Amortization 7.881 10.628 12.522 12.724 10.249 8.919

Adjusted EBITDA $15.214 $0.481 $24.690 $20.472 $10.724 $10.249 $14.044

EBITDA Margin % 8.4% 0.4% 11.5% 9.9% 6.3% 6.0% 8.0%

Less: Depreciation & Amortization 7.881 10.628 12.522 12.724 10.249 8.919

Adjusted EBIT $4.871 ($7.400) $14.062 $7.950 ($2.000) $0.000 $5.125

EBIT Margin % 2.7% -6.2% 6.6% 3.8% -1.2% 0.0% 2.9%

Capital Expenditures 9.622 22.506 12.618 13.300 10.000 10.000

EBITDA less CapEx ($9.141) $2.184 $7.854 ($2.576) $0.249 $4.044