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Issue / Promoter Counsel’s Draft / SPE’s Draft

1.Restrictions on Transfers (Section 2.1)

/ Change in control of Non-SPE Shareholders not a deemed transfer / Change in control of Non-SPE Shareholder is deemed transfer

2.No-Transfers to Non Permitted Transferees (Section 2.1(c))

/ Concept is deleted (but kept definition of Non-Permitted Transferees) / Non-SPE Shareholders will not transfer Shares to Non-Permitted Transferees under any circumstances

3.Permitted Transfers (Section 2.2)

/ All Shareholders may transfer Shares to their respective Affiliates without any consent / Only SPE Shareholders may transfer Shares to their Affiliates without any consent

4.Right of First Negotiation (Section 3.1)

/ 15 Business-Day negotiation period between transferring Shareholder and all other Shareholders (i.e., SPE does not have first right to negotiate) / If transferring Shareholder is a non-SPE Shareholder – SPE Shareholders have a right to negotiate first for 30 days; If no agreement is reached or SPE Shareholders have no interest, other Shareholders have a right to negotiate for additional 30 days
If transferring Shareholder is a SPE Shareholder – Non-SPE Shareholders have right to negotiate for 30 days

5.Right of Last Refusal (Section 3.2)

/ SPE Shareholders have 30-day period to exercise right of last refusal on sales by Non-SPE Shareholders
Silent on Non-SPE Shareholders having right to exercise secondary refusal right on sales by other Non-SPE shareholders, but that may be an oversight.
If Transferring Party is SPE Shareholders, Non-SPE Shareholders have 30-day period to exercise right of last refusal / SPE Shareholders have 30-day period to exercise right of last refusal on sales by Non-SPE Shareholders
If SPE Shareholders do not exercise their right, other Non-SPE Shareholders have a 30-day additional period to exercise right of last refusal.
If Transferring Party is SPE Shareholders, Non-SPE Shareholders have 30-day period to exercise right of last refusal

6.Tag-Along (Section 3.3)

/ If a SPE Shareholder is the Transferring Party (no matter how many shares are being transferred), Non-SPE Shareholders have a 30-day period to tag-along such number of Shares as they wish under the same terms / No tag-along rights

7.Certain Corporate Matters (Section 4.3)

(a)Super-Majority Vote (Section 4.3)

/ Shareholders holding 75% of issued Shares but approval shall not be unreasonably withheld or delayed / Shareholders holding 75% of issued Shares

(b)Issuance of Share Capital (Section 4.3(b))

/ 75% vote required for all issuances of Shares and other equity securities / 75% vote not required if issuance is subject to preemptive rights

(c)Change in Accounting and Tax Methods; Policies of Maa (Sections 4.3(o)(p))

/ 75% vote not required if Board determines that change mandated by applicable law / 75% vote not required if Board determines that change mandated by applicable law or is in the best interest of Maa

8.Election of Directors, Numbers and Composition (Section 4.4)

/ Board comprised of 7 directors
SPE Shareholders have right to designate four directors; Non-SPE Shareholders have right to designate three directors
So long as SPE Shareholders own more than 50% they have right to recommend a SPE Director to be appointed Chairman
Right to designate directors is not updated to reflect ownership percentage; SPE Shareholders and Non-SPE Shareholders lose their rights only if their respective ownership percentage is 10% or less
Non-SPE Shareholders may appoint a Non-SPE Director who is affiliated with a Non-Permitted Transferee; If a Non-SPE Director becomes affiliated with a Non-Permitted Transferee he/she may remain director
Person who has been charged or convicted of any crime may be a director
Matters required 75% vote of Shareholders require also approval of at least one Non-SPE Director (in effect, Non-SPE Shareholders have veto right as long as they have 10%)
At Closing Non-SPE Shareholders have right to appoint one observer / Board comprised of 5 directors
SPE Shareholders have right to designate three directors; Non-SPE Shareholders have right to designate two directors
Number of directors designated by SPE Shareholders or Non-SPE Shareholders to reflect ownership percentage at any point of time (if holdings less than 10% no right to appoint director)
So long SPE Shareholders hold more than 50% they have right to designate majority of directors and to designate chairman of Board
Non-SPE Shareholders shall not appoint a Non-SPE Director who is affiliated with a Non-Permitted Transferee; If a Non-SPE Director becomes affiliated with a Non-Permitted Transferee he/she will be removed
No person who has been charged or convicted of any crime can be a director
Matters required 75% vote of Shareholders do not also require approval a Non-SPE Director

9.Board Committees (Section 4.5)

/ Constitution of committees require agreement of Non-SPE Shareholders
Silent re existing committees / Board may constitute committees
At Closing, all committees already constituted will be reconstituted to be comprised of SPE Directors only as members

10.Officers (Section 4.7)

/ Appointment of CEO, CFO, CPO and CRO requires affirmative vote of at least one Non-SPE Director
Person who has been charged or convicted of any crime may be an officer, manager or employee / Appointment of CEO, CFO, CPO and CRO requires affirmative vote of at least two SPE Directors
No person who has been charged or convicted of any crime can be an officer, manager or employee

11.External Auditors (Section 4.8)

/ Replacement of PWC requires consent of at least one Non-SPE Director / Replacement of PWC requires consent of SPE Shareholders so long designate majority of directors

12.Compliance with Anti-Bribery Laws (Section 4.10)

/ SPE Shareholders may cause Maa to adopt anti-bribery policies only if policies are reasonable
No requirement to conduct diligence on third parties with whom Maa may engage
Deleted requirement that any third party retained to deal with Government Officials sign non-bribery compliance representation / SPE Shareholders may cause Maa to adopt anti-bribery policies
Diligence to be performed on third parties with whom Maa may engage
Any third party retained to deal with Government Officials will sign non-bribery compliance representation

13.Code of Conduct (Section 4.11)

/ Maa is not required to comply with Sony Pictures Code of Business Conduct or any other policies of Sony Pictures Entertainment (other than anti-bribery related) / Maa is required to comply with Sony Pictures Code of Business Conduct and any other policies of Sony Pictures Entertainment

14.Related Party Transactions (Section 4.13)

/ Acquisition of programming from SPE Shareholders only if in arm’s length terms
Mechanics of challenging related party transactions deleted / Acquisition of programming from SPE Shareholders even if not in arm’s length terms permitted up to an agreed cap
Shareholders may challenge related party transactions in breach; challenged Shareholder retroactively shall revise terms to be on arm’s length but transaction shall not be voided

15.Programming Right of First Refusal and Last Negotiation (Section 4.14(d))

/ Definition of “Promoter Content” – any Telegu motion picture rights or content owned by Geeta Arts or Annapoorna Studio
If Geeta Arts or Annapoorna Studio elects to grant satellite license rights to any Promoter Content, it will negotiate with Maa for 7 days for such rights
No right of last refusal
Obligation ceases if Arvid Babu does not hold Shares in Maa or does not control Geeta Arts and if Nagarjuna Rao does not hold Shares in Maa or does not control Annapoorna Studio, as applicable / Definition of “Promoter Content” – any motion picture or TV Programming rights or content owned by a Promoter Shareholder (Prasad, Chiranjeevi, Nagarjuna Rao, Ramakrishna) or Affiliates
If a Promoter Shareholder elects to license the distribution and exploitation rights to any Promoter Content, it will negotiate with Maa for 30 days for such rights
Before accepting a third party offer, a Promoter Shareholders must notify Maa of its terms and allow Maa 30 days to match

16.Option to Purchase Underlying Shares (Section 5.1)

/ SPE Shareholders to purchase 811,270 Shares underlying options held by employees by September 30, 2014
Shares will include 400,000 Shares held by Ramakrishna / SPE Shareholders have call option to purchase 811,270 Shares underlying options held by employees, which expires on September 30, 2014

17.Call Option (Section 5.2)

/ Cap is deleted
/ Call Price subject to a cap equal to the product of (i) percentage of Shares owned by Non-SPE Shareholders and (ii) Rs. 2,000 Crores

18.Determination of Fair Market Value (Section 5.3)

/ If difference between Independent Valuers’ determinations is 10% or less, value is the average
If difference is more than 10% a third Independent Valuer is appointed by Independent Valuers
If Independent Valuers cannot appoint a third valuer, the president of SIAC will / If difference between Independent Valuers’ determinations is 20% or less, value is the average
If difference is more than 20%, a third Independent Valuer is appointed by Independent Valuers
If Independent Valuers cannot appoint a third valuer, the president or vice president of LCIA will

19.Transfer to Third Parties; Company Sale (Section 5.4A)

/ If SPE Shareholders do not exercise Call Option, Non-SPE Shareholders have right to transfer Shares to third parties with no transfer restrictions
Non-SPE Shareholders have right to require sale of Maa in auction between 7th anniversary and 10th anniversary of Closing
Sale price may be less than FMV
Purchaser may be a Non-Permitted Transferee
SPE Shareholders may be obligated to agree to any restrictive covenant or terms not equally applicable to Non-SPE Shareholders / If SPE Shareholders do not exercise Call Option, Non-SPE Shareholders’ right to transfer Shares to third parties is subject to rights of first negotiation and last refusal
Non-SPE Shareholders have right to require sale of Maa in auction between 7th anniversary and 8th anniversary of Closing
In no event shall the sale price be less than FMV
In no event shall the purchaser be a Non-Permitted Transferee
SPE Shareholders will not be obligated to agree to any restrictive covenant or terms not equally applicable to Non-SPE Shareholders

20.Non-SPE Shareholders Call Option (Section 5.4B)

/ If SPE Shareholders do not exercise Call Option, Non-SPE Shareholders have a call option to purchase all Shares held by SPE Shareholders at FMV / No Non-SPE Shareholders call option

21.Government Officials (Section 6.2(d))

/ Warranty is deleted / No Non-SPE Shareholder is a Government Official

22.Offset Right (Section 7.3(c))

/ No offset right / SPE Shareholders have right to offset on a pro rata basis Losses under SPA and Shareholders Agreements against amount payable to Non SPE Shareholders, including in respect of Call Price and dividends

23.Additional Capital Contributions (Section 8.1)

/ SPE Shareholders are obligated to contribute amounts required to repay Closing Indebtedness under SPA (or indemnify promoters) / No additional capital contributions are required

24.Non-Solicitation (Section 9.1(c))

/ No non-solicit / Non-SPE Shareholders’ will not induce any employee of Maa to leave position

25.Resolution of Disputes (Section 11.2)

/ SIAC rules
Arbitration in Singapore
Prohibition to seek relief in respect of motion pictures, productions or projects related to Purchasers and their Affiliates is deleted / LCIA rules
Arbitration in London
Non-SPE Shareholders have no right to seek any injunctive relief or Order with respect to production, distribution or other exploitation of motion pictures, productions or projects related to Purchasers and their Affiliates

26.Termination (Section 10.15)

/ Agreement terminated upon occurrence of (i) listing of Shares, or (ii) dissolution or winding up / Agreement terminated upon occurrence of (i) 75% vote (ii) listing of Shares, (iii) transfer of majority of Shares to third party, (iv) dissolution or winding up, or (v) material uncured breach by Non-SPE Shareholders of covenant re compliance with anti-bribery laws (if SPE Shareholders so elect)

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