Exhibit 6 Estimated Revenues and Costs for Films Released in 1989 by Six Major Studios and Hypothetical Sequels

ls a (in millions of 1991 $)

First Film Hypothetical Sequel

U.S. Distributi U.S. Distributi
Theater Other Distributi on Negative Theater Other Distributi on Negative
Studio/Movie Title Rentals Revenue on Fees Expense Cost Rentals Revenue on Fees Expense Cost

MCA UNIVERSAL
1 PARENTHOOD $55.0 $146.1 $53.6 $43.1 $22.0 $38.5 $106.1 $38.5 $32.6 $26.4
2 BORN ON THE FOURTH OF JULY 40.5 110.9 40.3 33.1 19.8 28.4 81.4 29.2 26.0 23.7
3 FIELD OF DREAMS 33.6 94.1 34.0 31.6 17.6 23.5 69.7 24.8 22.9 21.1
4 UNCLE BUCK 33.3 93.6 33.8 30.2 16.5 23.3 69.3 24.7 22.8 19.8
5 SEA OF LOVE 31.5 89.0 32.1 32.0 27.5 22.0 66.1 23.5 22.0 33.0
6 ALWAYS 22.0 66.1 23.4 28.0 34.1 15.4 50.1 17.4 17.7 40.9
7 K-9 20.5 62.3 22.0 20.9 13.2 14.3 47.5 16.4 17.0 15.8
8 THE ‘BURBS 19.0 58.9 20.7 22.9 18.7 13.3 45.0 15.5 16.4 22.4
9 THE DREAM TEAM 15.8 51.1 17.8 19.0 16.5 11.1 39.6 13.5 14.9 19.8
10 DO THE RIGHT THING 14.6 48.2 16.7 14.6 7.7 10.2 37.6 12.7 14.4 9.2
11 DAD 11.9 41.5 14.2 20.0 20.9 8.3 32.9 11.0 13.1 25.0
12 SHOCKER 8.3 32.7 10.9 14.6 6.6 5.8 26.7 8.6 11.5 7.9
13 THE WIZARD 5.5 26.1 8.4 9.5 8.8 3.9 22.1 6.9 10.3 10.5
14 RENEGADES 4.6 23.9 7.6 13.1 13.2 3.2 20.6 6.3 9.9 15.8

PARAMOUNT PICTURES
15 HARLEM NIGHTS $36.3 $100.8 $36.5 $41.7 $33.0 $25.4 $74.4 $26.6 $24.1 $39.5
16 PET SEMATARY 29.1 83.2 29.9 27.1 12.1 20.3 62.0 21.9 20.9 14.5
17 BLACK RAIN 27.5 79.4 28.5 31.6 33.0 19.3 59.4 20.9 20.2 39.5
18 MAJOR LEAGUE 23.7 70.1 25.0 26.1 13.2 16.6 52.9 18.5 18.4 15.8
19 COUSINS 11.0 39.4 13.4 14.4 14.3 7.7 31.4 10.4 12.8 17.1
20 WE’RE NO ANGELS 5.5 26.1 8.4 19.9 24.2 3.9 22.1 6.9 10.3 29.0
21 LET IT RIDE 2.3 18.3 5.5 10.8 19.8 1.6 16.7 4.8 8.8 23.7
22 SHIRLEY VALENTINE 2.3 18.3 5.5 5.6 8.8 1.6 16.7 4.8 8.8 10.5
23 FAT MAN AND LITTLE BOY 1.5 16.5 4.8 9.2 20.9 1.1 15.3 4.3 8.5 25.0
24 THE EXPERTS 0.0 12.7 3.4 0.8 13.2 0.0 12.7 3.4 7.8 15.8
SONY PICTURES ENTERTAINMENTb
25 LOOK WHO’S TALKING (TS) $75.8 $196.5 $72.6 $51.7 $11.0 $53.1 $141.4 $51.8 $41.9 $13.2
26 WHEN HARRY MET SALLY (C) 46.1 124.5 45.4 38.1 20.9 32.3 91.0 32.8 28.5 25.0
27 STEEL MAGNOLIAS (TS) 44.0 119.4 43.5 35.9 24.2 30.8 87.4 31.5 27.6 29.0
28 SEE NO EVIL; HEAR NO EVIL (TS) 22.5 67.1 23.8 23.1 19.8 15.7 50.8 17.7 17.9 23.7
29 THE BEAR (TS) 14.9 48.7 16.9 22.5 23.1 10.4 37.9 12.8 14.5 27.7
30 GLORY (TS) 14.3 47.4 16.4 14.5 23.1 10.0 37.0 12.5 14.2 27.7
31 LOOK UP (TS) 8.8 34.1 11.4 16.1 18.7 6.2 27.7 9.0 11.8 22.4
32 CASUALTIES OF WAR (C) 8.1 32.5 10.8 17.1 27.5 5.7 26.6 8.6 11.5 33.0
33 CHANCES ARE (TS) 7.2 30.1 9.9 15.4 19.8 5.0 24.9 7.9 11.0 23.7
34 FAMILY BUSINESS (TS) 6.6 28.7 9.4 16.5 19.8 4.6 23.9 7.6 10.8 23.7
35 SHE’S OUT OF CONTROL (C) 5.7 26.6 8.6 12.2 16.5 4.0 22.4 7.0 10.4 19.8
36 WHO’S HARRY CRUMB? (TS) 5.0 24.7 7.9 13.2 15.4 3.5 21.1 6.5 10.0 18.5
37 ADVENTURES OF BARON
MUNCHAUSEN (C) 4.3 23.1 7.3 7.8 57.1 3.0 20.0 6.1 9.7 68.5
38 TRUE BELIEVER (C) 4.1 22.6 7.1 12.8 15.4 2.9 19.6 6.0 9.6 18.5
39 TROOP BEVERLY HILLS (C) 4.0 22.3 7.0 11.5 19.8 2.8 19.5 5.9 9.6 23.7
40 TAP (TS) 3.9 22.1 6.9 11.4 16.5 2.7 19.3 5.8 9.5 19.8
41 DEEPSTAR SIX (TS) 3.4 21.0 6.5 10.0 8.8 2.4 18.5 5.5 9.3 10.5
42 JOHNNY HANDSOME (TS) 2.9 19.7 6.0 9.7 22.0 2.0 17.6 5.2 9.1 26.4
43 MUSIC BOX (TS) 2.8 19.4 5.9 8.4 19.8 1.9 17.4 5.1 9.0 23.7
44 IMMEDIATE FAMILY (C) 2.3 18.3 5.5 12.1 15.4 1.6 16.7 4.8 8.8 18.5
45 LISTEN TO ME (C) 2.0 17.5 5.2 12.0 16.5 1.4 16.1 4.6 8.7 19.8
46 PHYSICAL EVIDENCE (C) 1.7 16.7 4.9 9.2 18.7 1.2 15.5 4.4 8.5 22.4
47 OLD GRINGO (C) 1.5 16.5 4.8 6.6 37.3 1.1 15.3 4.3 8.5 44.8
48 LOVERBOY (TS) 1.5 16.5 4.8 10.5 11.0 1.1 15.3 4.3 8.5 13.2
49 SING (TS) 1.0 15.1 4.3 9.0 15.4 0.7 14.4 4.0 8.2 18.5
50 WINTER PEOPLE (C) 0.8 14.6 4.1 6.3 17.6 0.5 14.0 3.8 8.1 21.1
51 WELCOME HOME (C) 0.4 13.8 3.8 4.9 15.4 0.3 13.5 3.6 8.0 18.5
52 ADVENTURES OF MILO AND OTIS (C) 0.1 13.0 3.5 6.0 8.8 0.1 12.9 3.4 7.8 10.5
53 THE BIG PICTURE (C) 0.1 13.0 3.5 0.8 8.8 0.1 12.9 3.4 7.8 10.5
54 SLAVES OF NEW YORK (TS) 0.1 13.0 3.5 1.5 6.6 0.1 12.9 3.4 7.8 7.9
55 EAT A BOWL OF TEA (C) $0.1 $13.0 $3.5 $0.8 $2.2 $0.1 $12.9 $3.4 $7.8 $2.6
56 TO KILL A PRIEST (C) 0.0 12.7 3.4 0.8 11.0 0.0 12.7 3.4 7.8 13.2
57 ME AND HIM (C) 0.0 12.7 3.4 0.8 8.8 0.0 12.7 3.4 7.8 10.5
58 BLOODHOUNDS OF BROADWAY (C) 0.0 12.7 3.4 0.8 3.3 0.0 12.7 3.4 7.8 4.0

TWENTIETH CENTURY FOX

59 THE WAR OF THE ROSES $45.6 $123.2 $44.9 $39.1 $27.5 $31.9 $90.0 $32.5 $28.3 $33.0
60 THE ABYSS 31.6 89.3 32.2 37.2 49.4 22.1 66.3 23.5 22.0 59.3
61 WEEKEND AT BERNIE’S 15.4 50.1 17.4 16.3 11.0 10.8 38.9 13.2 14.7 13.2
62 SAY ANYTHING 9.8 36.5 12.3 15.2 14.3 6.9 29.4 9.6 12.2 17.1
63 SKIN DEEP 9.4 35.4 11.9 15.0 11.0 6.5 28.6 9.3 12.0 13.2
64 THE FABULOUS BAKER BOYS 8.8 34.1 11.4 16.1 14.3 6.2 27.7 9.0 11.8 17.1
65 MILLENNIUM 2.6 19.1 5.8 7.1 16.5 1.8 17.2 5.0 9.0 19.8
66 WORTH WINNING 1.7 16.7 4.9 10.5 14.3 1.2 15.5 4.4 8.5 17.1
67 GLEAMING THE CUBE 1.2 15.7 4.5 6.5 12.1 0.8 14.8 4.1 8.3 14.5
68 HOW I GOT INTO COLLEGE 0.6 14.1 3.9 8.8 13.2 0.4 13.7 3.7 8.0 15.8
69 WHEN THE WHALES CAME 0.0 12.7 3.4 1.4 4.4 0.0 12.7 3.4 7.8 5.3

WARNER BROTHERS
70 BATMAN $165.6 $414.2 $154.5 $102.0 $54.9 $115.9 $293.7 $109.2 $82.3 $65.9
71 DRIVING MISS DAISY 55.6 147.4 54.1 43.3 8.8 38.9 107.0 38.9 32.8 10.5
72 TANGO & CASH 33.1 93.0 33.6 40.4 60.4 23.2 68.9 24.5 22.7 72.5
73 LEAN ON ME 15.8 51.1 17.8 17.7 16.5 11.1 39.6 13.5 14.9 19.8
74 HER ALIBI 10.1 37.3 12.6 16.6 22.0 7.1 29.9 9.8 12.4 26.4
75 NEXT OF KIN 7.7 31.4 10.4 14.3 13.2 5.4 25.8 8.3 11.3 15.8
76 PINK CADILLAC 7.5 30.9 10.2 16.8 20.9 5.2 25.4 8.1 11.2 25.0
77 YOUNG EINSTEIN 6.6 28.7 9.4 11.3 4.4 4.6 23.9 7.6 10.8 5.3
78 DEAD-BANG 3.9 22.1 6.9 11.4 15.4 2.7 19.3 5.8 9.5 18.5
79 DEAD CALM 3.6 21.5 6.7 10.1 9.9 2.5 18.9 5.7 9.4 11.9
80 SECOND SIGHT 2.8 19.4 5.9 9.7 11.0 1.9 17.4 5.1 9.0 13.2
81 SEE YOU IN THE MORNING 2.4 18.6 5.6 9.6 18.7 1.7 16.8 4.9 8.9 22.4
82 IN COUNTRY 1.8 17.0 5.0 9.3 19.8 1.2 15.7 4.5 8.6 23.7
83 COOKIE 1.1 15.4 4.4 5.1 14.3 0.8 14.6 4.1 8.3 17.1
84 HOW TO GET AHEAD IN ADVERTISING 0.2 13.3 3.6 0.9 5.5 0.2 13.1 3.5 7.9 6.6
85 POWWOW HIGHWAY 0.1 13.0 3.5 0.8 4.4 0.1 12.9 3.4 7.8 5.3
86 BERT RIGBY, YOU’RE A FOOL 0.0 12.7 3.4 1.4 14.3 0.0 12.7 3.4 7.8 17.1
87 PENN & TELLER GET KILLED 0.0 12.7 3.4 0.8 8.8 0.0 12.7 3.4 7.8 10.5
88 CHECKING OUT 0.0 12.7 3.4 0.8 5.5 0.0 12.7 3.4 7.8 6.6
THE WALT DISNEY COMPANYb
89 HONEY, I SHRUNK THE KIDS (W) $80.0 $206.7 $76.4 $58.6 $24.2 $56.0 $148.5 $54.5 $43.8 $29.0
90 DEAD POETS SOCIETY (T) 53.3 141.8 52.0 46.2 22.0 37.3 103.1 37.4 31.8 26.4
91 THE LITTLE MERMAID (W) 44.2 120.0 43.7 38.6 22.0 31.0 87.8 31.6 27.7 26.4
92 TURNER & HOOTCH (T) 38.8 106.9 38.8 32.5 19.8 27.2 78.6 28.2 25.3 23.7
93 THREE FUGITIVES (T) 20.4 62.1 21.9 22.2 18.7 14.3 47.3 16.4 17.0 22.4
94 AN INNOCENT MAN (T) 11.6 40.7 13.9 17.2 18.7 8.1 32.3 10.7 13.0 22.4
95 BLAZE (T) 9.9 36.7 12.4 17.8 19.8 6.9 29.5 9.7 12.3 23.7
96 NEW YORK STORIES (T) 5.2 25.3 8.1 10.7 20.9 3.6 21.5 6.7 10.1 25.0
97 GROSS ANATOMY (T) 5.1 25.0 8.0 13.2 13.2 3.5 21.3 6.6 10.1 15.8
98 DISORGANIZED CRIME (T) 4.4 23.4 7.4 11.7 12.1 3.1 20.2 6.2 9.8 14.5
99 CHEETAH (W) 4.4 23.4 7.4 10.4 7.7 3.1 20.2 6.2 9.8 9.2
AVERAGES $14.9 $48.8 $16.9 $17.4 $17.6 $10.4 $38.0 $12.9 $14.5 $21.2

a
Metro-Goldwyn-Mayer and Orion are excluded. Fees assume films were financed by an independent producer. Costs exclude gross participations and interest charges.
b
C=Columbia Pictures; TS=Tri-Star. W=Walt Disney; T=Touchstone.
Exhibit 7 Estimated Expected Present Values and One-Year Holding Period Returns Based on Data in Exhibit 6 (in millions of dollars)
Films Hypothetical sequels
PV of PV of
PV of Net PV of Net
Negative One-Year Negative One-Year
Studio/Movie Title Inflows at Inflows at
Cost at Year Return Cost at Year Return
Year 1 Year 4
0 3

border
1 PARENTHOOD $100.1 $21.5 3.65 $76.8 $28.2 1.72
2 BORN ON THE FOURTH OF JULY 74.5 19.4 2.85 56.8 25.4 1.24
3 FIELD OF DREAMS 59.1 17.2 2.44 47.3 22.6 1.1
4 UNCLE BUCK 60.0 16.1 2.72 47.0 21.2 1.22
5 SEA OF LOVE 53.5 26.9 0.99 44.4 35.3 0.26
6 ALWAYS 34.3 33.3 0.03 31.4 43.7 (0.28)
7 K-9 37.8 12.9 1.93 29.3 16.9 0.73
8 THE ‘BURBS 32.2 18.3 0.76 27.3 24.0 0.14
9 THE DREAM TEAM 28.4 16.1 0.76 22.9 21.2 0.08
10 DO THE RIGHT THING 30.0 7.5 2.98 21.2 9.9 1.15
11 DAD 17.7 20.4 (0.13) 17.4 26.8 (0.35)
12 SHOCKER 14.3 6.5 1.22 12.4 8.5 0.47
13 THE WIZARD 12.7 8.6 0.48 8.7 11.3 (0.23)
14 RENEGADES 6.9 12.9 (0.46) 7.4 16.9 (0.56)

PARAMOUNT PICTURES
15 HARLEM NIGHTS $55.4 $32.3 0.72 $51.1 $42.3 0.21
16 PET SEMATARY 52.6 11.8 3.45 41.1 15.5 1.65
17 BLACK RAIN 44.1 32.3 0.37 39.0 42.3 (0.08)
18 MAJOR LEAGUE 40.3 12.9 2.12 33.7 16.9 0.99
19 COUSINS 21.2 14.0 0.52 16.2 18.3 (0.11)
20 WE’RE NO ANGELS 2.1 23.7 (0.91) 8.7 31.0 (0.72)
21 LET IT RIDE 3.6 19.4 (0.82) 4.3 25.4 (0.83)
22 SHIRLEY VALENTINE 8.9 8.6 0.04 4.3 11.3 (0.62)
23 FAT MAN AND LITTLE BOY 3.3 20.4 (0.84) 3.2 26.8 (0.88)
24 THE EXPERTS 8.2 12.9 (0.36) 1.1 16.9 (0.94)
SONY PICTURES ENTERTAINMENTc
25 LOOK WHO’S TALKING (TS) $142.3 $10.8 12.24 $105.5 $14.1 6.48
26 WHEN HARRY MET SALLY (C) 83.3 20.4 3.08 64.6 26.8 1.41
27 STEEL MAGNOLIAS (TS) 80.4 23.7 2.40 61.7 31.0 0.99
28 SEE NO EVIL; HEAR NO EVIL (TS) 40.5 19.4 1.09 32.0 25.4 0.26
29 THE BEAR (TS) 22.4 22.6 (0.01) 21.5 29.6 (0.27)
30 GLORY (TS) 29.3 22.6 0.30 20.8 29.6 (0.30)
31 LOOK UP (TS) 14.1 18.3 (0.23) 13.2 24.0 (0.45)
32 CASUALTIES OF WAR (C) 11.4 26.9 (0.57) 12.3 35.3 (0.65)
33 CHANCES ARE (TS) 10.8 19.4 (0.44) 10.9 25.4 (0.57)
34 FAMILY BUSINESS (TS) 8.3 19.4 (0.57) 10.2 25.4 (0.60)
35 SHE’S OUT OF CONTROL (C) 10.5 16.1 (0.35) 9.0 21.2 (0.58)
36 WHO’S HARRY CRUMB? (TS) 7.6 15.1 (0.49) 7.9 19.7 (0.60)
37 ADVENTURES OF BARON MUNCHAUSEN (C) 11.6 55.9 (0.79) 7.0 73.4 (0.90)
38 TRUE BELIEVER (C) 5.8 15.1 (0.61) 6.7 19.7 (0.66)
39 TROOP BEVERLY HILLS (C) 6.9 19.4 (0.64) 6.5 25.4 (0.74)
40 TAP (TS) 6.7 16.1 (0.58) 6.4 21.2 (0.70)
41 DEEPSTAR SIX (TS) 7.1 8.6 (0.17) 5.8 11.3 (0.49)
42 JOHNNY HANDSOME (TS) 6.0 21.5 (0.72) 5.0 28.2 (0.82)
43 MUSIC BOX (TS) 7.1 19.4 (0.63) 4.9 25.4 (0.81)
44 IMMEDIATE FAMILY (C) 2.2 15.1 (0.85) 4.3 19.7 (0.78)
45 LISTEN TO ME (C) 1.6 16.1 (0.90) 3.8 21.2 (0.82)
46 PHYSICAL EVIDENCE (C) 3.6 18.3 (0.80) 3.4 24.0 (0.86)
47 OLD GRINGO (C) 6.0 36.6 (0.84) 3.2 48.0 (0.93)
48 LOVERBOY (TS) 2.0 10.8 (0.81) 3.2 14.1 (0.77)
49 SING (TS) 2.2 15.1 (0.85) 2.4 19.7 (0.88)
50 WINTER PEOPLE (C) 4.4 17.2 (0.74) 2.1 22.6 (0.91)
51 WELCOME HOME (C) 5.1 15.1 (0.66) 1.7 19.7 (0.91)
52 ADVENTURES OF MILO AND OTIS (C) 3.1 8.6 (0.64) 1.2 11.3 (0.89)
53 THE BIG PICTURE (C) 8.4 8.6 (0.02) 1.2 11.3 (0.89)
54 SLAVES OF NEW YORK (TS) 7.8 6.5 0.20 1.2 8.5 (0.85)
55 EAT A BOWL OF TEA (C) 8.4 2.2 2.92 1.2 2.8 (0.56)
56 TO KILL A PRIEST (C) 8.2 10.8 (0.24) 1.1 14.1 (0.92)
57 ME AND HIM (C) $8.2 $8.6 (0.05) $1.1 $11.3 (0.90)
58 BLOODHOUNDS OF BROADWAY (C) 8.2 3.2 1.54 1.1 4.2 (0.74)

TWENTIETH CENTURY FOX

59 THE WAR OF THE ROSES $80.8 $26.9 2.01 $63.8 $35.3 0.81
60 THE ABYSS 48.4 48.4 0.00 44.6 63.5 (0.30)
61 WEEKEND AT BERNIE’S 30.2 10.8 1.81 22.3 14.1 0.58
62 SAY ANYTHING 17.5 14.0 0.25 14.6 18.3 (0.21)
63 SKIN DEEP 16.6 10.8 0.54 14.0 14.1 (0.01)
64 THE FABULOUS BAKER BOYS 14.1 14.0 0.01 13.2 18.3 (0.28)
65 MILLENNIUM 8.2 16.1 (0.49) 4.7 21.2 (0.78)
66 WORTH WINNING 2.2 14.0 (0.84) 3.4 18.3 (0.82)
67 GLEAMING THE CUBE 5.3 11.8 (0.55) 2.7 15.5 (0.82)
68 HOW I GOT INTO COLLEGE 1.3 12.9 (0.90) 1.8 16.9 (0.89)
69 WHEN THE WHALES CAME 7.5 4.3 0.75 1.1 5.6 (0.81)

WARNER BROTHERS
70 BATMAN $311.5 $53.8 4.80 $229.1 $70.5 2.25
71 DRIVING MISS DAISY 101.2 8.6 10.76 77.6 11.3 5.87
72 TANGO & CASH 48.9 59.1 (0.17) 46.7 77.6 (0.40)
73 LEAN ON ME 29.8 16.1 0.85 22.9 21.2 0.08
74 HER ALIBI 16.8 21.5 (0.22) 15.0 28.2 (0.47)
75 NEXT OF KIN 13.2 12.9 0.02 11.7 16.9 (0.31)
76 PINK CADILLAC 10.1 20.4 (0.51) 11.4 26.8 (0.58)
77 YOUNG EINSTEIN 13.6 4.3 2.17 10.2 5.6 0.80
78 DEAD-BANG 6.7 15.1 (0.55) 6.4 19.7 (0.68)
79 DEAD CALM 7.6 9.7 (0.22) 6.1 12.7 (0.52)
80 SECOND SIGHT 5.8 10.8 (0.46) 4.9 14.1 (0.65)
81 SEE YOU IN THE MORNING 5.1 18.3 (0.72) 4.4 24.0 (0.82)
82 IN COUNTRY 3.8 19.4 (0.80) 3.5 25.4 (0.86)
83 COOKIE 6.4 14.0 (0.54) 2.6 18.3 (0.86)
84 HOW TO GET AHEAD IN ADVERTISING 8.6 5.4 0.61 1.4 7.1 (0.80)
85 POWWOW HIGHWAY 8.4 4.3 0.96 1.2 5.6 (0.78)
86 BERT RIGBY. YOU’RE A FOOL 7.5 14.0 (0.46) 1.1 18.3 (0.94)
87 PENN & TELLER GET KILLED 8.2 8.6 (0.05) 1.1 11.3 (0.90)
88 CHECKING OUT 8.2 5.4 0.53 1.1 7.1 (0.85)
THE WALT DISNEY COMPANY
89 HONEY. I SHRUNK THE KIDS (W) $145.5 $23.7 5.15 $111.2 $31.0 2.58
90 DEAD POETS SOCIETY (T) 92.5 21.5 3.30 74.4 28.2 1.64
91 THE LITTLE MERMAID (W) 78.1 21.5 2.63 62.0 28.2 1.20
92 TURNER & HOOTCH (T) 71.2 19.4 2.68 54.6 25.4 1.15
93 THREE FUGITIVES (T) 36.3 18.3 0.98 29.1 24.0 0.21
94 AN INNOCENT MAN (T) 19.7 18.3 0.08 17.0 24.0 (0.29)
95 BLAZE (T) 15.0 19.4 (0.22) 14.7 25.4 (0.42)
96 NEW YORK STORIES (T) 10.7 20.4 (0.47) 8.2 26.8 (0.69)
97 GROSS ANATOMY (T) 7.8 12.9 (0.39) 8.1 16.9 (0.52)
98 DISORGANIZED CRIME (T) 7.8 11.8 (0.34) 7.1 15.5 (0.54)
99 CHEETAH (W) 9.2 7.5 0.22 7.1 9.9 (0.28)

Average: $27.7 $17.3 0.67 $21.6 $22.6 (0.08)

Median: $10.5 $16.1 (0.02) $8.7 $21.2 (0.54)
Standard deviation: $41.4 $10.1 2.07 $31.5 $13.3 1.21

Interquartile range: $6.9 to $10.8 to (0.55) to $ 3.4 to $14.1 to (0.82) to

$34.3 $20.4 0.99 $29.1 $26.8 0.21
aNet inflows consist of all revenues minus associated distribution fees and expenses.

bOne-year return is defined as: [PV of net inflows minus PV of negative cost] divided by [PV of negative cost].

cC=Columbia Pictures; TS=Tri-Star. W=Walt Disney; T=Touchstone.

Exhibit 7 Estimated Expected Present Values and One-Year Holding
Period Returns Based on Data in Exhibit 6 (in millions of dollars)

First Film Hypothetical Sequel

PV of
PV of PV of One-Year PV of Net Negative NPV Year
Studio/ PV of Net Negative PV of Net Negative Return Inflows cost at 0
Movie Inflows Cost at One-Year Inflows Cost at at year 0
Year 0
Title at Year 1a Year 0 Returnb at Year 4a Year 3

MCA UNIVERSAL
1 PAREN $100.1 $21.5 3.65 $76.8 $28.2 1.72 48.19 19.88 28.31
2 BORN O 74.5 19.4 2.85 56.8 25.4 1.24 35.64 17.91 17.73
3 FIELD 59.1 17.2 2.44 47.3 22.6 1.1 29.68 15.93 13.74
4 UNCLE 60.0 16.1 2.72 47.0 21.2 1.22 29.49 14.95 14.54
5 SEA OF 53.5 26.9 0.99 44.4 35.3 0.26 27.86 24.89 2.97
6 ALWAYS 34.3 33.3 0.03 31.4 43.7 (0.28) 19.70 30.81 -11.11
7 K-9 37.8 12.9 1.93 29.3 16.9 0.73 18.38 11.91 6.47
8 THE ‘BU 32.2 18.3 0.76 27.3 24.0 0.14 17.13 16.92 0.21
9 THE DR 28.4 16.1 0.76 22.9 21.2 0.08 14.37 14.95 -0.58
10 DO THE 30.0 7.5 2.98 21.2 9.9 1.15 13.30 6.98 6.32
11 DAD 17.7 20.4 (0.13) 17.4 26.8 (0.35) 10.92 18.89 -7.98
12 SHOCK 14.3 6.5 1.22 12.4 8.5 0.47 7.78 5.99 1.79
13 THE W 12.7 8.6 0.48 8.7 11.3 (0.23) 5.46 7.97 -2.51
14 RENEG 6.9 12.9 (0.46) 7.4 16.9 (0.56) 4.64 11.91 -7.27

PARAMOUNT PICTURES
15 HARLE $55.4 $32.3 0.72 $51.1 $42.3 0.21 32.06 29.82 2.24
16 PET S 52.6 11.8 3.45 41.1 15.5 1.65 25.79 10.93 14.86
17 BLACK 44.1 32.3 0.37 39.0 42.3 (0.08) 24.47 29.82 -5.35
18 MAJOR 40.3 12.9 2.12 33.7 16.9 0.99 21.14 11.91 9.23
19 COUSI 21.2 14.0 0.52 16.2 18.3 (0.11) 10.16 12.90 -2.74
20 WE’RE 2.1 23.7 (0.91) 8.7 31.0 (0.72) 5.46 21.85 -16.40
21 LET IT 3.6 19.4 (0.82) 4.3 25.4 (0.83) 2.70 17.91 -15.21
22 SHIRL 8.9 8.6 0.04 4.3 11.3 (0.62) 2.70 7.97 -5.27
23 FAT MA 3.3 20.4 (0.84) 3.2 26.8 (0.88) 2.01 18.89 -16.89
24 THE E 8.2 12.9 (0.36) 1.1 16.9 (0.94) 0.69 11.91 -11.22

SONY PICTURES ENTERTAINMENTc

25 LOOK W $142.3 $10.8 12.24 $105.5 $14.1 6.48 66.19 9.94 56.25
26 WHEN 83.3 20.4 3.08 64.6 26.8 1.41 40.53 18.89 21.64
27 STEEL 80.4 23.7 2.40 61.7 31.0 0.99 38.71 21.85 16.86
28 SEE NO 40.5 19.4 1.09 32.0 25.4 0.26 20.08 17.91 2.17
29 THE BE 22.4 22.6 (0.01) 21.5 29.6 (0.27) 13.49 20.87 -7.38
30 GLORY 29.3 22.6 0.30 20.8 29.6 (0.30) 13.05 20.87 -7.82
31 LOOK U 14.1 18.3 (0.23) 13.2 24.0 (0.45) 8.28 16.92 -8.64
32 CASUAL 11.4 26.9 (0.57) 12.3 35.3 (0.65) 7.72 24.89 -17.17
33 CHANCE 10.8 19.4 (0.44) 10.9 25.4 (0.57) 6.84 17.91 -11.07
34 FAMILY 8.3 19.4 (0.57) 10.2 25.4 (0.60) 6.40 17.91 -11.51
35 SHE’S 10.5 16.1 (0.35) 9.0 21.2 (0.58) 5.65 14.95 -9.30
36 WHO’S 7.6 15.1 (0.49) 7.9 19.7 (0.60) 4.96 13.89 -8.93
37 ADVEN 11.6 55.9 (0.79) 7.0 73.4 (0.90) 4.39 51.74 -47.35
38 TRUE B 5.8 15.1 (0.61) 6.7 19.7 (0.66) 4.20 13.89 -9.68
39 TROOP 6.9 19.4 (0.64) 6.5 25.4 (0.74) 4.08 17.91 -13.83
40 TAP (TS 6.7 16.1 (0.58) 6.4 21.2 (0.70) 4.02 14.95 -10.93
41 DEEPST 7.1 8.6 (0.17) 5.8 11.3 (0.49) 3.64 7.97 -4.33
42 JOHNN 6.0 21.5 (0.72) 5.0 28.2 (0.82) 3.14 19.88 -16.74
43 MUSIC 7.1 19.4 (0.63) 4.9 25.4 (0.81) 3.07 17.91 -14.83
44 IMMEDI 2.2 15.1 (0.85) 4.3 19.7 (0.78) 2.70 13.89 -11.19
45 LISTEN 1.6 16.1 (0.90) 3.8 21.2 (0.82) 2.38 14.95 -12.56
46 PHYSIC 3.6 18.3 (0.80) 3.4 24.0 (0.86) 2.13 16.92 -14.79
47 OLD GR 6.0 36.6 (0.84) 3.2 48.0 (0.93) 2.01 33.84 -31.83
48 LOVER 2.0 10.8 (0.81) 3.2 14.1 (0.77) 2.01 9.94 -7.93
49 SING (T 2.2 15.1 (0.85) 2.4 19.7 (0.88) 1.51 13.89 -12.38
50 WINTER 4.4 17.2 (0.74) 2.1 22.6 (0.91) 1.32 15.93 -14.61
51 WELCO 5.1 15.1 (0.66) 1.7 19.7 (0.91) 1.07 13.89 -12.82
52 ADVENT 3.1 8.6 (0.64) 1.2 11.3 (0.89) 0.75 7.97 -7.21
53 THE BI 8.4 8.6 (0.02) 1.2 11.3 (0.89) 0.75 7.97 -7.21
54 SLAVES 7.8 6.5 0.20 1.2 8.5 (0.85) 0.75 5.99 -5.24
55 EAT A 8.4 2.2 2.92 1.2 2.8 (0.56) 0.75 1.97 -1.22
56 TO KILL 8.2 10.8 (0.24) 1.1 14.1 (0.92) 0.69 9.94 -9.25
57 ME AND $8.2 $8.6 (0.05) $1.1 $11.3 (0.90) 0.69 7.97 -7.28
58 BLOOD 8.2 3.2 1.54 1.1 4.2 (0.74) 0.69 2.96 -2.27

TWENTIETH CENTURY FOX

59 THE W $80.8 $26.9 2.01 $63.8 $35.3 0.81 40.03 24.89 15.14
60 THE A 48.4 48.4 0.00 44.6 63.5 (0.30) 27.98 44.76 -16.78
61 WEEKE 30.2 10.8 1.81 22.3 14.1 0.58 13.99 9.94 4.05
62 SAY A 17.5 14.0 0.25 14.6 18.3 (0.21) 9.16 12.90 -3.74
63 SKIN D 16.6 10.8 0.54 14.0 14.1 (0.01) 8.78 9.94 -1.16
64 THE F 14.1 14.0 0.01 13.2 18.3 (0.28) 8.28 12.90 -4.62
65 MILLE 8.2 16.1 (0.49) 4.7 21.2 (0.78) 2.95 14.95 -12.00
66 WORTH 2.2 14.0 (0.84) 3.4 18.3 (0.82) 2.13 12.90 -10.77
67 GLEAM 5.3 11.8 (0.55) 2.7 15.5 (0.82) 1.69 10.93 -9.23
68 HOW I 1.3 12.9 (0.90) 1.8 16.9 (0.89) 1.13 11.91 -10.78
69 WHEN 7.5 4.3 0.75 1.1 5.6 (0.81) 0.69 3.95 -3.26

WARNER BROTHERS
70 BATMA $311.5 $53.8 4.80 $229.1 $70.5 2.25 143.74 49.70 94.04
71 DRIVIN 101.2 8.6 10.76 77.6 11.3 5.87 48.69 7.97 40.72
72 TANGO 48.9 59.1 (0.17) 46.7 77.6 (0.40) 29.30 54.70 -25.40
73 LEAN 29.8 16.1 0.85 22.9 21.2 0.08 14.37 14.95 -0.58
74 HER AL 16.8 21.5 (0.22) 15.0 28.2 (0.47) 9.41 19.88 -10.47
75 NEXT O 13.2 12.9 0.02 11.7 16.9 (0.31) 7.34 11.91 -4.57
76 PINK C 10.1 20.4 (0.51) 11.4 26.8 (0.58) 7.15 18.89 -11.74
77 YOUNG 13.6 4.3 2.17 10.2 5.6 0.80 6.40 3.95 2.45
78 DEAD- 6.7 15.1 (0.55) 6.4 19.7 (0.68) 4.02 13.89 -9.87
79 DEAD 7.6 9.7 (0.22) 6.1 12.7 (0.52) 3.83 8.95 -5.13
80 SECON 5.8 10.8 (0.46) 4.9 14.1 (0.65) 3.07 9.94 -6.87
81 SEE Y 5.1 18.3 (0.72) 4.4 24.0 (0.82) 2.76 16.92 -14.16
82 IN CO 3.8 19.4 (0.80) 3.5 25.4 (0.86) 2.20 17.91 -15.71
83 COOKI 6.4 14.0 (0.54) 2.6 18.3 (0.86) 1.63 12.90 -11.27
84 HOW T 8.6 5.4 0.61 1.4 7.1 (0.80) 0.88 5.01 -4.13
85 POWW 8.4 4.3 0.96 1.2 5.6 (0.78) 0.75 3.95 -3.19
86 BERT R 7.5 14.0 (0.46) 1.1 18.3 (0.94) 0.69 12.90 -12.21
87 PENN & 8.2 8.6 (0.05) 1.1 11.3 (0.90) 0.69 7.97 -7.28
88 CHECK 8.2 5.4 0.53 1.1 7.1 (0.85) 0.69 5.01 -4.32
THE WALT DISNEY COMPANY
89 HONEY. $145.5 $23.7 5.15 $111.2 $31.0 2.58 69.77 21.85 47.91
90 DEAD P 92.5 21.5 3.30 74.4 28.2 1.64 46.68 19.88 26.80
91 THE LI 78.1 21.5 2.63 62.0 28.2 1.20 38.90 19.88 19.02
92 TURNE 71.2 19.4 2.68 54.6 25.4 1.15 34.26 17.91 16.35
93 THREE 36.3 18.3 0.98 29.1 24.0 0.21 18.26 16.92 1.34
94 AN INN 19.7 18.3 0.08 17.0 24.0 (0.29) 10.67 16.92 -6.25
95 BLAZE ( 15.0 19.4 (0.22) 14.7 25.4 (0.42) 9.22 17.91 -8.68
96 NEW YO 10.7 20.4 (0.47) 8.2 26.8 (0.69) 5.14 18.89 -13.75
97 GROSS 7.8 12.9 (0.39) 8.1 16.9 (0.52) 5.08 11.91 -6.83
98 DISORG 7.8 11.8 (0.34) 7.1 15.5 (0.54) 4.45 10.93 -6.47
99 CHEETA 9.2 7.5 0.22 7.1 9.9 (0.28) 4.45 6.98 -2.52

Averag $27.7 $17.3 0.67 $21.6 $22.6 (0.08)

Median $10.5 $16.1 (0.02) $8.7 $21.2 (0.54)
Standar $41.4 $10.1 2.07 $31.5 $13.3 1.21

Interqu $6.9 to $10.8 to (0.55) to $ 3.4 to $14.1 to (0.82) to

$34.3 $20.4 0.99 $29.1 $26.8 0.21

aNet inflows consist of all revenues minus associated distribution fees and expenses.

bOne-year return is defined as: [PV of net inflows minus PV of negative cost] divided by [PV of negative cost].

cC=Columbia Pictures; TS=Tri-Star. W=Walt Disney; T=Touchstone.

 Semiannual discount rate
0.06

Annual discount rate

0.1236

TOTAL NPV (only >0)

483.17

Total number of films

99

Value per film (only >0)

4.88

TOTAL NPV (all movies)

-240.38

PV Average cash inflow

$13.5 d1 = 0.97173
d2 = -1.128861
PV expected negative costs
$16.0 N(d1) = 0.834408
N(d2) = 0.129478
Time to maturity (years)
3 Value of the option rights
9.57
Annual risk-free rate
0.06

Annualized volatility
1.21

d1 = 0.97173
d2 = -1.128861

N(d1) = 0.834408
N(d2) = 0.129478
Value of the option rights
9.57
 DCF with option
Semi-annual discount rate Annual discount rate Total NPV NPV per-film
0.04 0.0816 582.27 5.88
0.05 0.1025 530.33 5.36
0.06 0.1236 483.17 4.88
0.07 0.1449 440.4 4.45
0.08 0.1664 401.69 4.06
 Black Scholes Model
Semi-annual discount rate Annual discount rate NPV per-film
0.04 0.0816 11.23
0.05 0.1025 10.36
0.06 0.1236 9.57
0.07 0.1449 8.84
0.08 0.1664 8.17
Exhibit 9 Summary Statistics for Samples of Films Released in 1987 and 1988 a (dollar figures in millions)

Table A 1987 Data

First Film Hypothetical Sequel

U.S. Distributi U.S. Distributi
Theater Other Distributi on Negative Theater Other Distributi on Negative
Rentals Revenue on Fees Expense Cost Rentals Revenue on Fees Expense Cost

Average (in 1991 $): $21.3 $64.4 $22.8 $21.5 $26.3 $14.9 $48.9 $17.0 $17.4 $31.6

First Film Hypothetical Sequel

PV of PV of
PV of Net Negative PV of Net Negative
Inflows Cost at One-Year Inflows Cost at One-Year
at Year 1 Year 0 Returna at Year 4 Year 3 Returna

Average: $39.4 $25.8 0.71 $30.4 $33.8 0.01

Median: $30.9 $22.3 0.04 $24.0 $29.3 (0.39)
Standard deviation: $38.4 $9.4 2.05 $29.4 $12.3 1.20

Interquartile range: $11.1 $18.8 (0.60) $8.8 $24.6 (0.75)

to to to to to to
$52.1 $29.3 1.22 $40.2 $38.5 0.31

Table B 1988 Data

First Film Hypothetical Sequel

U.S. Distributi U.S. Distributi
Theater Other Distributi on Negative Theater Other Distributi on Negative
Rentals Revenue on Fees Expense Cost Rentals Revenue on Fees Expense Cost

Average (in 1991 $): $19.7 $60.5 $21.3 $20.5 $24.4 $13.8 $46.1 $15.9 $16.7 $29.2
 First Film Hypothetical Sequel

PV of PV of
PV of Net Negative PV of Net Negative
Inflows Cost at One-Year Inflows Cost at One-Year
at Year 1 Year 0 Returna at Year 4 Year 3 Returna
Average: $36.4 $23.8 0.48 $28.2 $31.3 (0.13)
Median: $22.4 $20.3 0.01 $17.5 $26.6 (0.40)
Standard deviation: $38.2 $11.4 1.37 $29.3 $14.9 0.80
Interquartile range: $9.3 $16.9 (0.48) $7.5 $22.2 (0.69)
to to to to to to
$42.1 $24.8 0.93 $32.5 $32.5 0.14

a
One-year return is defined as: [PV of net inflows minus PV of negative cost] divided by [PV of negative cost].
Exhibit 7 Estimated Expected Present Values and One-Year Holding Period Returns
Based on Data in Exhibit 6 (in millions of dollars)

Hypothetical Sequels Hypothetical sequels

PV of PV of
PV of Net PV of Net
Negative One-Year Negative
Studio/Movie Title Inflows at Inflows at
Cost at Return cost at
Year 4a year 0
Year 3 Year 0

MCA UNIVERSAL
1 PARENTHOOD 76.8 28.2 1.72 48.19 19.88
2 BORN ON THE FOURTH OF JULY 56.8 25.4 1.24 35.64 17.91
3 FIELD OF DREAMS 47.3 22.6 1.1 29.68 15.93
4 UNCLE BUCK 47.0 21.2 1.22 29.49 14.95
5 SEA OF LOVE 44.4 35.3 0.26 27.86 24.89
6 ALWAYS 31.4 43.7 (0.28) 19.70 30.81
7 K-9 29.3 16.9 0.73 18.38 11.91
8 THE ‘BURBS 27.3 24.0 0.14 17.13 16.92
9 THE DREAM TEAM 22.9 21.2 0.08 14.37 14.95
10 DO THE RIGHT THING 21.2 9.9 1.15 13.30 6.98
11 DAD 17.4 26.8 (0.35) 10.92 18.89
12 SHOCKER 12.4 8.5 0.47 7.78 5.99
13 THE WIZARD 8.7 11.3 (0.23) 5.46 7.97
14 RENEGADES 7.4 16.9 (0.56) 4.64 11.91

PARAMOUNT PICTURES
15 HARLEM NIGHTS $51.1 $42.3 0.21 32.06 29.82
16 PET SEMATARY 41.1 15.5 1.65 25.79 10.93
17 BLACK RAIN 39.0 42.3 (0.08) 24.47 29.82
18 MAJOR LEAGUE 33.7 16.9 0.99 21.14 11.91
19 COUSINS 16.2 18.3 (0.11) 10.16 12.90
20 WE’RE NO ANGELS 8.7 31.0 (0.72) 5.46 21.85
21 LET IT RIDE 4.3 25.4 (0.83) 2.70 17.91
22 SHIRLEY VALENTINE 4.3 11.3 (0.62) 2.70 7.97
23 FAT MAN AND LITTLE BOY 3.2 26.8 (0.88) 2.01 18.89
24 THE EXPERTS 1.1 16.9 (0.94) 0.69 11.91

SONY PICTURES ENTERTAINMENTc

25 LOOK WHO’S TALKING (TS) $105.5 $14.1 6.48 66.19 9.94
26 WHEN HARRY MET SALLY (C) 64.6 26.8 1.41 40.53 18.89
27 STEEL MAGNOLIAS (TS) 61.7 31.0 0.99 38.71 21.85
28 SEE NO EVIL; HEAR NO EVIL (TS) 32.0 25.4 0.26 20.08 17.91
29 THE BEAR (TS) 21.5 29.6 (0.27) 13.49 20.87
30 GLORY (TS) 20.8 29.6 (0.30) 13.05 20.87
31 LOOK UP (TS) 13.2 24.0 (0.45) 8.28 16.92
32 CASUALTIES OF WAR (C) 12.3 35.3 (0.65) 7.72 24.89
33 CHANCES ARE (TS) 10.9 25.4 (0.57) 6.84 17.91
34 FAMILY BUSINESS (TS) 10.2 25.4 (0.60) 6.40 17.91
35 SHE’S OUT OF CONTROL (C) 9.0 21.2 (0.58) 5.65 14.95
36 WHO’S HARRY CRUMB? (TS) 7.9 19.7 (0.60) 4.96 13.89
37 ADVENTURES OF BARON MUNCHAUSEN (C) 7.0 73.4 (0.90) 4.39 51.74
38 TRUE BELIEVER (C) 6.7 19.7 (0.66) 4.20 13.89
39 TROOP BEVERLY HILLS (C) 6.5 25.4 (0.74) 4.08 17.91
40 TAP (TS) 6.4 21.2 (0.70) 4.02 14.95
41 DEEPSTAR SIX (TS) 5.8 11.3 (0.49) 3.64 7.97
42 JOHNNY HANDSOME (TS) 5.0 28.2 (0.82) 3.14 19.88
43 MUSIC BOX (TS) 4.9 25.4 (0.81) 3.07 17.91
44 IMMEDIATE FAMILY (C) 4.3 19.7 (0.78) 2.70 13.89
45 LISTEN TO ME (C) 3.8 21.2 (0.82) 2.38 14.95
46 PHYSICAL EVIDENCE (C) 3.4 24.0 (0.86) 2.13 16.92
47 OLD GRINGO (C) 3.2 48.0 (0.93) 2.01 33.84
48 LOVERBOY (TS) 3.2 14.1 (0.77) 2.01 9.94
49 SING (TS) 2.4 19.7 (0.88) 1.51 13.89
50 WINTER PEOPLE (C) 2.1 22.6 (0.91) 1.32 15.93
51 WELCOME HOME (C) 1.7 19.7 (0.91) 1.07 13.89
52 ADVENTURES OF MILO AND OTIS (C) 1.2 11.3 (0.89) 0.75 7.97
53 THE BIG PICTURE (C) 1.2 11.3 (0.89) 0.75 7.97
54 SLAVES OF NEW YORK (TS) 1.2 8.5 (0.85) 0.75 5.99
55 EAT A BOWL OF TEA (C) 1.2 2.8 (0.56) 0.75 1.97
56 TO KILL A PRIEST (C) 1.1 14.1 (0.92) 0.69 9.94
57 ME AND HIM (C) $1.1 $11.3 (0.90) 0.69 7.97
58 BLOODHOUNDS OF BROADWAY (C) 1.1 4.2 (0.74) 0.69 2.96

TWENTIETH CENTURY FOX

59 THE WAR OF THE ROSES $63.8 $35.3 0.81 40.03 24.89
60 THE ABYSS 44.6 63.5 (0.30) 27.98 44.76
61 WEEKEND AT BERNIE’S 22.3 14.1 0.58 13.99 9.94
62 SAY ANYTHING 14.6 18.3 (0.21) 9.16 12.90
63 SKIN DEEP 14.0 14.1 (0.01) 8.78 9.94
64 THE FABULOUS BAKER BOYS 13.2 18.3 (0.28) 8.28 12.90
65 MILLENNIUM 4.7 21.2 (0.78) 2.95 14.95
66 WORTH WINNING 3.4 18.3 (0.82) 2.13 12.90
67 GLEAMING THE CUBE 2.7 15.5 (0.82) 1.69 10.93
68 HOW I GOT INTO COLLEGE 1.8 16.9 (0.89) 1.13 11.91
69 WHEN THE WHALES CAME 1.1 5.6 (0.81) 0.69 3.95

WARNER BROTHERS
70 BATMAN $229.1 $70.5 2.25 143.74 49.70
71 DRIVING MISS DAISY 77.6 11.3 5.87 48.69 7.97
72 TANGO & CASH 46.7 77.6 (0.40) 29.30 54.70
73 LEAN ON ME 22.9 21.2 0.08 14.37 14.95
74 HER ALIBI 15.0 28.2 (0.47) 9.41 19.88
75 NEXT OF KIN 11.7 16.9 (0.31) 7.34 11.91
76 PINK CADILLAC 11.4 26.8 (0.58) 7.15 18.89
77 YOUNG EINSTEIN 10.2 5.6 0.80 6.40 3.95
78 DEAD-BANG 6.4 19.7 (0.68) 4.02 13.89
79 DEAD CALM 6.1 12.7 (0.52) 3.83 8.95
80 SECOND SIGHT 4.9 14.1 (0.65) 3.07 9.94
81 SEE YOU IN THE MORNING 4.4 24.0 (0.82) 2.76 16.92
82 IN COUNTRY 3.5 25.4 (0.86) 2.20 17.91
83 COOKIE 2.6 18.3 (0.86) 1.63 12.90
84 HOW TO GET AHEAD IN ADVERTISING 1.4 7.1 (0.80) 0.88 5.01
85 POWWOW HIGHWAY 1.2 5.6 (0.78) 0.75 3.95
86 BERT RIGBY. YOU’RE A FOOL 1.1 18.3 (0.94) 0.69 12.90
87 PENN & TELLER GET KILLED 1.1 11.3 (0.90) 0.69 7.97
88 CHECKING OUT 1.1 7.1 (0.85) 0.69 5.01
THE WALT DISNEY COMPANY
89 HONEY. I SHRUNK THE KIDS (W) $111.2 $31.0 2.58 69.77 21.85
90 DEAD POETS SOCIETY (T) 74.4 28.2 1.64 46.68 19.88
91 THE LITTLE MERMAID (W) 62.0 28.2 1.20 38.90 19.88
92 TURNER & HOOTCH (T) 54.6 25.4 1.15 34.26 17.91
93 THREE FUGITIVES (T) 29.1 24.0 0.21 18.26 16.92
94 AN INNOCENT MAN (T) 17.0 24.0 (0.29) 10.67 16.92
95 BLAZE (T) 14.7 25.4 (0.42) 9.22 17.91
96 NEW YORK STORIES (T) 8.2 26.8 (0.69) 5.14 18.89
97 GROSS ANATOMY (T) 8.1 16.9 (0.52) 5.08 11.91
98 DISORGANIZED CRIME (T) 7.1 15.5 (0.54) 4.45 10.93
99 CHEETAH (W) 7.1 9.9 (0.28) 4.45 6.98

Average: $21.6 $22.6 (0.08)

Median: $8.7 $21.2 (0.54)
Standard deviation: $31.5 $13.3 1.21

Interquartile range: $ 3.4 to $14.1 to (0.82) to

$29.1 $26.8 0.21

aNet inflows consist of all revenues minus associated distribution fees and expenses.

bOne-year return is defined as: [PV of net inflows minus PV of negative cost] divided by [PV of negative cost].

cC=Columbia Pictures; TS=Tri-Star. W=Walt Disney; T=Touchstone.

thetical sequels

NPV Year
0

Semiannual discount rate 0.06

28.31 Annual discount rate 0.1236
17.73 TOTAL NPV (only >0) 483.17
13.74 Total number of films 99
14.54 Value per film (only >0) 4.88
2.97 TOTAL NPV (all movies) -240.38
-11.11
6.47
0.21
-0.58
6.32
-7.98
1.79
-2.51
-7.27

2.24
14.86
-5.35
9.23
-2.74
-16.40
-15.21
-5.27
-16.89
-11.22

56.25
21.64
16.86
2.17
-7.38
-7.82
-8.64
-17.17
-11.07
-11.51
-9.30
-8.93
-47.35
-9.68
-13.83
-10.93
 -4.33
-16.74
-14.83
-11.19
-12.56
-14.79
-31.83
-7.93
-12.38
-14.61
-12.82
-7.21
-7.21
-5.24
-1.22
-9.25
-7.28
-2.27

15.14
-16.78
4.05
-3.74
-1.16
-4.62
-12.00
-10.77
-9.23
-10.78
-3.26

94.04
40.72
-25.40
-0.58
-10.47
-4.57
-11.74
2.45
-9.87
-5.13
-6.87
-14.16
-15.71
-11.27
-4.13
-3.19
-12.21
-7.28
-4.32
 47.91
26.80
19.02
16.35
1.34
-6.25
-8.68
-13.75
-6.83
-6.47
-2.52
Assumptions
1. Given that Arundel has the option to exercise its sequel rights, it will apply them only if the expecte
2. The discount rate consider to report the net cash flow at present value was 0.1236%
3. If Arundel doesn't use the rights, it can sell them, but we are not consider this value in the DCF com

Doubts
The case states 'all the sequels followed successful films, but not all the successful films are followed by sequels'. If only a part
considered only some of them (e.g, multiplying the NPV for a percentage, but we have no data about which percentage is follow
estimations are referred to only one sequel of the film of all of them (e.g., one film was followed by 16 films). We could make so
have a sequel in order to comply with the 2 milion desired by the studios
utation consider only positive NPV films.
and One-Year Holding Period Returns Based on
Data in Exhibit 6 (in millions of dollars)

Hypothetical sequels

PV of
PV of Net
Negative NPV Year
Studio/Movie Title Inflows at
cost at 0
year 0
Year 0

MCA UNIVERSAL
1 PARENTHOOD 48.19 19.88 28.31
2 BORN ON THE FOURTH OF JULY 35.64 17.91 17.73
3 FIELD OF DREAMS 29.68 15.93 13.74
4 UNCLE BUCK 29.49 14.95 14.54
5 SEA OF LOVE 27.86 24.89 2.97
6 ALWAYS 19.70 30.81 -11.11
7 K-9 18.38 11.91 6.47
8 THE ‘BURBS 17.13 16.92 0.21
9 THE DREAM TEAM 14.37 14.95 -0.58
10 DO THE RIGHT THING 13.30 6.98 6.32
11 DAD 10.92 18.89 -7.98
12 SHOCKER 7.78 5.99 1.79
13 THE WIZARD 5.46 7.97 -2.51
14 RENEGADES 4.64 11.91 -7.27

PARAMOUNT PICTURES
15 HARLEM NIGHTS 32.06 29.82 2.24
16 PET SEMATARY 25.79 10.93 14.86
17 BLACK RAIN 24.47 29.82 -5.35
18 MAJOR LEAGUE 21.14 11.91 9.23
19 COUSINS 10.16 12.90 -2.74
20 WE’RE NO ANGELS 5.46 21.85 -16.40
21 LET IT RIDE 2.70 17.91 -15.21
22 SHIRLEY VALENTINE 2.70 7.97 -5.27
23 FAT MAN AND LITTLE BOY 2.01 18.89 -16.89
24 THE EXPERTS 0.69 11.91 -11.22

SONY PICTURES ENTERTAINMENTc

25 LOOK WHO’S TALKING (TS) 66.19 9.94 56.25
26 WHEN HARRY MET SALLY (C) 40.53 18.89 21.64
27 STEEL MAGNOLIAS (TS) 38.71 21.85 16.86
28 SEE NO EVIL; HEAR NO EVIL (TS) 20.08 17.91 2.17
29 THE BEAR (TS) 13.49 20.87 -7.38
30 GLORY (TS) 13.05 20.87 -7.82
31 LOOK UP (TS) 8.28 16.92 -8.64
32 CASUALTIES OF WAR (C) 7.72 24.89 -17.17
33 CHANCES ARE (TS) 6.84 17.91 -11.07
34 FAMILY BUSINESS (TS) 6.40 17.91 -11.51
35 SHE’S OUT OF CONTROL (C) 5.65 14.95 -9.30
36 WHO’S HARRY CRUMB? (TS) 4.96 13.89 -8.93
37 ADVENTURES OF BARON MUNCHAUSEN (C) 4.39 51.74 -47.35
38 TRUE BELIEVER (C) 4.20 13.89 -9.68
39 TROOP BEVERLY HILLS (C) 4.08 17.91 -13.83
40 TAP (TS) 4.02 14.95 -10.93
41 DEEPSTAR SIX (TS) 3.64 7.97 -4.33
42 JOHNNY HANDSOME (TS) 3.14 19.88 -16.74
43 MUSIC BOX (TS) 3.07 17.91 -14.83
44 IMMEDIATE FAMILY (C) 2.70 13.89 -11.19
45 LISTEN TO ME (C) 2.38 14.95 -12.56
46 PHYSICAL EVIDENCE (C) 2.13 16.92 -14.79
47 OLD GRINGO (C) 2.01 33.84 -31.83
48 LOVERBOY (TS) 2.01 9.94 -7.93
49 SING (TS) 1.51 13.89 -12.38
50 WINTER PEOPLE (C) 1.32 15.93 -14.61
51 WELCOME HOME (C) 1.07 13.89 -12.82
52 ADVENTURES OF MILO AND OTIS (C) 0.75 7.97 -7.21
53 THE BIG PICTURE (C) 0.75 7.97 -7.21
54 SLAVES OF NEW YORK (TS) 0.75 5.99 -5.24
55 EAT A BOWL OF TEA (C) 0.75 1.97 -1.22
56 TO KILL A PRIEST (C) 0.69 9.94 -9.25
57 ME AND HIM (C) 0.69 7.97 -7.28
58 BLOODHOUNDS OF BROADWAY (C) 0.69 2.96 -2.27

TWENTIETH CENTURY FOX

59 THE WAR OF THE ROSES 40.03 24.89 15.14
60 THE ABYSS 27.98 44.76 -16.78
61 WEEKEND AT BERNIE’S 13.99 9.94 4.05
62 SAY ANYTHING 9.16 12.90 -3.74
63 SKIN DEEP 8.78 9.94 -1.16
64 THE FABULOUS BAKER BOYS 8.28 12.90 -4.62
65 MILLENNIUM 2.95 14.95 -12.00
66 WORTH WINNING 2.13 12.90 -10.77
67 GLEAMING THE CUBE 1.69 10.93 -9.23
68 HOW I GOT INTO COLLEGE 1.13 11.91 -10.78
69 WHEN THE WHALES CAME 0.69 3.95 -3.26

WARNER BROTHERS
70 BATMAN 143.74 49.70 94.04
71 DRIVING MISS DAISY 48.69 7.97 40.72
72 TANGO & CASH 29.30 54.70 -25.40
73 LEAN ON ME 14.37 14.95 -0.58
74 HER ALIBI 9.41 19.88 -10.47
75 NEXT OF KIN 7.34 11.91 -4.57
76 PINK CADILLAC 7.15 18.89 -11.74
77 YOUNG EINSTEIN 6.40 3.95 2.45
78 DEAD-BANG 4.02 13.89 -9.87
79 DEAD CALM 3.83 8.95 -5.13
80 SECOND SIGHT 3.07 9.94 -6.87
81 SEE YOU IN THE MORNING 2.76 16.92 -14.16
82 IN COUNTRY 2.20 17.91 -15.71
83 COOKIE 1.63 12.90 -11.27
84 HOW TO GET AHEAD IN ADVERTISING 0.88 5.01 -4.13
85 POWWOW HIGHWAY 0.75 3.95 -3.19
86 BERT RIGBY. YOU’RE A FOOL 0.69 12.90 -12.21
87 PENN & TELLER GET KILLED 0.69 7.97 -7.28
88 CHECKING OUT 0.69 5.01 -4.32
THE WALT DISNEY COMPANY
89 HONEY. I SHRUNK THE KIDS (W) 69.77 21.85 47.91
90 DEAD POETS SOCIETY (T) 46.68 19.88 26.80
91 THE LITTLE MERMAID (W) 38.90 19.88 19.02
92 TURNER & HOOTCH (T) 34.26 17.91 16.35
93 THREE FUGITIVES (T) 18.26 16.92 1.34
94 AN INNOCENT MAN (T) 10.67 16.92 -6.25
95 BLAZE (T) 9.22 17.91 -8.68
96 NEW YORK STORIES (T) 5.14 18.89 -13.75
97 GROSS ANATOMY (T) 5.08 11.91 -6.83
98 DISORGANIZED CRIME (T) 4.45 10.93 -6.47
99 CHEETAH (W) 4.45 6.98 -2.52

Average:
Median:
Standard deviation:

Interquartile range:

aNet inflows consist of all revenues minus associated distribution fees and expenses.

bOne-year return is defined as: [PV of net inflows minus PV of negative cost] divided by [PV of negative cost].

cC=Columbia Pictures; TS=Tri-Star. W=Walt Disney; T=Touchstone.

 TRADITIONAL DCF
Semi-annual discount rate 0.06
Annualized discount rate 0.1236
Total number of films 99
TOTAL NPV -240.38
Assumptions
1. Given that Arundel has the option to exercise its sequel rights, it will apply them only if the expecte
2. The discount rate consider to report the net cash flow at present value was 0.1236%
3. If Arundel doesn't use the rights, it can sell them, but we are not consider this value in the DCF com

Doubts
The case states 'all the sequels followed successful films, but not all the successful films are followed by sequels'. If only a part
considered only some of them (e.g, multiplying the NPV for a percentage, but we have no data about which percentage is follow
estimations are referred to only one sequel of the film of all of them (e.g., one film was followed by 16 films). We could make so
have a sequel in order to comply with the 2 milion desired by the studios
utation consider only positive NPV films.
and One-Year Holding Period Returns Based on
Data in Exhibit 6 (in millions of dollars)

Hypothetical sequels

PV of
PV of Net
Negative NPV Year
Studio/Movie Title Inflows at
cost at 0
year 0
Year 0

MCA UNIVERSAL
1 PARENTHOOD 48.19 19.88 28.31
2 BORN ON THE FOURTH OF JULY 35.64 17.91 17.73
3 FIELD OF DREAMS 29.68 15.93 13.74
4 UNCLE BUCK 29.49 14.95 14.54
5 SEA OF LOVE 27.86 24.89 2.97
6 ALWAYS 19.70 30.81 -11.11
7 K-9 18.38 11.91 6.47
8 THE ‘BURBS 17.13 16.92 0.21
9 THE DREAM TEAM 14.37 14.95 -0.58
10 DO THE RIGHT THING 13.30 6.98 6.32
11 DAD 10.92 18.89 -7.98
12 SHOCKER 7.78 5.99 1.79
13 THE WIZARD 5.46 7.97 -2.51
14 RENEGADES 4.64 11.91 -7.27

PARAMOUNT PICTURES
15 HARLEM NIGHTS 32.06 29.82 2.24
16 PET SEMATARY 25.79 10.93 14.86
17 BLACK RAIN 24.47 29.82 -5.35
18 MAJOR LEAGUE 21.14 11.91 9.23
19 COUSINS 10.16 12.90 -2.74
20 WE’RE NO ANGELS 5.46 21.85 -16.40
21 LET IT RIDE 2.70 17.91 -15.21
22 SHIRLEY VALENTINE 2.70 7.97 -5.27
23 FAT MAN AND LITTLE BOY 2.01 18.89 -16.89
24 THE EXPERTS 0.69 11.91 -11.22

SONY PICTURES ENTERTAINMENTc

25 LOOK WHO’S TALKING (TS) 66.19 9.94 56.25
26 WHEN HARRY MET SALLY (C) 40.53 18.89 21.64
27 STEEL MAGNOLIAS (TS) 38.71 21.85 16.86
28 SEE NO EVIL; HEAR NO EVIL (TS) 20.08 17.91 2.17
29 THE BEAR (TS) 13.49 20.87 -7.38
30 GLORY (TS) 13.05 20.87 -7.82
31 LOOK UP (TS) 8.28 16.92 -8.64
32 CASUALTIES OF WAR (C) 7.72 24.89 -17.17
33 CHANCES ARE (TS) 6.84 17.91 -11.07
34 FAMILY BUSINESS (TS) 6.40 17.91 -11.51
35 SHE’S OUT OF CONTROL (C) 5.65 14.95 -9.30
36 WHO’S HARRY CRUMB? (TS) 4.96 13.89 -8.93
37 ADVENTURES OF BARON MUNCHAUSEN (C) 4.39 51.74 -47.35
38 TRUE BELIEVER (C) 4.20 13.89 -9.68
39 TROOP BEVERLY HILLS (C) 4.08 17.91 -13.83
40 TAP (TS) 4.02 14.95 -10.93
41 DEEPSTAR SIX (TS) 3.64 7.97 -4.33
42 JOHNNY HANDSOME (TS) 3.14 19.88 -16.74
43 MUSIC BOX (TS) 3.07 17.91 -14.83
44 IMMEDIATE FAMILY (C) 2.70 13.89 -11.19
45 LISTEN TO ME (C) 2.38 14.95 -12.56
46 PHYSICAL EVIDENCE (C) 2.13 16.92 -14.79
47 OLD GRINGO (C) 2.01 33.84 -31.83
48 LOVERBOY (TS) 2.01 9.94 -7.93
49 SING (TS) 1.51 13.89 -12.38
50 WINTER PEOPLE (C) 1.32 15.93 -14.61
51 WELCOME HOME (C) 1.07 13.89 -12.82
52 ADVENTURES OF MILO AND OTIS (C) 0.75 7.97 -7.21
53 THE BIG PICTURE (C) 0.75 7.97 -7.21
54 SLAVES OF NEW YORK (TS) 0.75 5.99 -5.24
55 EAT A BOWL OF TEA (C) 0.75 1.97 -1.22
56 TO KILL A PRIEST (C) 0.69 9.94 -9.25
57 ME AND HIM (C) 0.69 7.97 -7.28
58 BLOODHOUNDS OF BROADWAY (C) 0.69 2.96 -2.27

TWENTIETH CENTURY FOX

59 THE WAR OF THE ROSES 40.03 24.89 15.14
60 THE ABYSS 27.98 44.76 -16.78
61 WEEKEND AT BERNIE’S 13.99 9.94 4.05
62 SAY ANYTHING 9.16 12.90 -3.74
63 SKIN DEEP 8.78 9.94 -1.16
64 THE FABULOUS BAKER BOYS 8.28 12.90 -4.62
65 MILLENNIUM 2.95 14.95 -12.00
66 WORTH WINNING 2.13 12.90 -10.77
67 GLEAMING THE CUBE 1.69 10.93 -9.23
68 HOW I GOT INTO COLLEGE 1.13 11.91 -10.78
69 WHEN THE WHALES CAME 0.69 3.95 -3.26

WARNER BROTHERS
70 BATMAN 143.74 49.70 94.04
71 DRIVING MISS DAISY 48.69 7.97 40.72
72 TANGO & CASH 29.30 54.70 -25.40
73 LEAN ON ME 14.37 14.95 -0.58
74 HER ALIBI 9.41 19.88 -10.47
75 NEXT OF KIN 7.34 11.91 -4.57
76 PINK CADILLAC 7.15 18.89 -11.74
77 YOUNG EINSTEIN 6.40 3.95 2.45
78 DEAD-BANG 4.02 13.89 -9.87
79 DEAD CALM 3.83 8.95 -5.13
80 SECOND SIGHT 3.07 9.94 -6.87
81 SEE YOU IN THE MORNING 2.76 16.92 -14.16
82 IN COUNTRY 2.20 17.91 -15.71
83 COOKIE 1.63 12.90 -11.27
84 HOW TO GET AHEAD IN ADVERTISING 0.88 5.01 -4.13
85 POWWOW HIGHWAY 0.75 3.95 -3.19
86 BERT RIGBY. YOU’RE A FOOL 0.69 12.90 -12.21
87 PENN & TELLER GET KILLED 0.69 7.97 -7.28
88 CHECKING OUT 0.69 5.01 -4.32
THE WALT DISNEY COMPANY
89 HONEY. I SHRUNK THE KIDS (W) 69.77 21.85 47.91
90 DEAD POETS SOCIETY (T) 46.68 19.88 26.80
91 THE LITTLE MERMAID (W) 38.90 19.88 19.02
92 TURNER & HOOTCH (T) 34.26 17.91 16.35
93 THREE FUGITIVES (T) 18.26 16.92 1.34
94 AN INNOCENT MAN (T) 10.67 16.92 -6.25
95 BLAZE (T) 9.22 17.91 -8.68
96 NEW YORK STORIES (T) 5.14 18.89 -13.75
97 GROSS ANATOMY (T) 5.08 11.91 -6.83
98 DISORGANIZED CRIME (T) 4.45 10.93 -6.47
99 CHEETAH (W) 4.45 6.98 -2.52

Average:
Median:
Standard deviation:

Interquartile range:

aNet inflows consist of all revenues minus associated distribution fees and expenses.

bOne-year return is defined as: [PV of net inflows minus PV of negative cost] divided by [PV of negative cost].

cC=Columbia Pictures; TS=Tri-Star. W=Walt Disney; T=Touchstone.

 DCF WITH OPTION
Semi-annual discount rate 0.06
Annualized discount rate 0.1236
TOTAL NPV (only >0) 483.17
Total number of films 99
Value per film (only >0) 4.88
Assumptions
1. Given that Arundel has the option to exercise its sequel rights, it will apply them only if the expecte
2. The discount rate consider to report the net cash flow at present value was 0.1236%
3. If Arundel doesn't use the rights, it can sell them, but we are not consider this value in the DCF com

Doubts
The case states 'all the sequels followed successful films, but not all the successful films are followed by sequels'. If only a part
considered only some of them (e.g, multiplying the NPV for a percentage, but we have no data about which percentage is follow
estimations are referred to only one sequel of the film of all of them (e.g., one film was followed by 16 films). We could make so
have a sequel in order to comply with the 2 milion desired by the studios
utation consider only positive NPV films.