Directors' dealings and proposed awards

ENTERTAINMENT ONE LTD.

23 May 2013

DIRECTORS' DEALINGS AND PROPOSED AWARDS UNDER THE NEW LONG TERM INCENTIVE PLAN

Directors' dealings

Following the announcement this morning of Entertainment One's intention to transfer to a premium listing ("Transfer"), Darren Throop, Patrice Theroux and Giles Willits ("Management") each intend to sell common shares in the Company ("Common Shares"), and trading plans have been set up with Cenkos Securities plc to facilitate the sale of those shares in two tranches. Darren Throop and Giles Willits each intend to sell a total of 750,000 Common Shares and Patrice Theroux intends to sell 500,000 Common Shares in advance of the Transfer.

Management Participation Scheme

Further, as outlined in the announcement on 21 May 2013 of the Company's results for the year ended 31 March 2013, the conditions of the Management Participation Scheme ("MPS") have been met. Management have indicated an intention to exercise their put option in relation to this scheme and have signed conditional put notices which will be delivered by them to Osler, Hoskin & Harcourt LLP, the Company's Canadian counsel, to hold in escrow until the transfer of the Common Shares from the standard listing segment to the premium listing segment of the Official List of the Financial Conduct Authority. The conditions of the escrow are such that Osler will deliver the put notice on behalf of Management to the Company on the date of the transfer of the Common Shares to the premium listing, unless otherwise directed by Management. 

Proposed awards under new long term incentive plan

As set out in the announcement on 21 May 2013 of the Company's results for the year ended 31 March 2013, the Board has proposed to put in place an executive incentive plan that is broadly similar to those of premium listed FTSE 250 companies for the benefit of Darren Throop, Patrice Theroux and Giles Willits. This scheme will include new proposals on salary, bonus and a long term incentive plan ("LTIP"). Performance will be measured against adjusted earnings per share, adjusted return on capital employed and total shareholder return. Shareholder approval will be sought in relation to the proposed adoption of the LTIP and further details are set out in the circular to shareholders issued by the Company and dated 23 May 2013, which includes notice convening an annual and special meeting of its shareholders to be held on 28 June 2013 ("Shareholder Circular"). A summary of the key terms of the LTIP is set out in the Shareholder Circular.

On or shortly after adoption of the LTIP, and subject to approval from the Remuneration Committee of the Company, the proposed first awards under the LTIP are:

·; Darren Throop will receive performance-related awards over Common Shares with a value at grant equal to 125% of base salary; and

·; Patrice Theroux and Giles Willits will each receive performance-related awards over Common Shares with a value at grant equal to 100% of base salary.

These awards will normally vest, subject to continued employment with a group company and any applicable performance and other conditions, on the later of the third anniversary of the date of award and the date on which the Remuneration Committee determines that the performance and other conditions have been satisfied (in whole or in part).

The proposed performance conditions that will apply to the above awards are as follows:

·; Vesting of 33% of each award will be based on the Entertainment One group of companies (the "Group") adjusted earnings per share ("EPS") performance; 34% on the Group's total shareholder return ("TSR") performance (measured on both an absolute and a relative basis); and 33% on the Group's return on capital employed ("ROCE") performance (with each measure applying independently);

·; the EPS performance measure involves achieving annual growth targets taking the basis as EPS for the year ended 31 March 2013.

For the portion of the award subject to the EPS measure:

(i) 30% will vest if the EPS compound annual growth rate ("CAGR") is 10.0%;

(ii) 100% will vest if a CAGR of 15.0% is achieved; and

(iii) if EPS growth falls between these targets, vesting will occur on a straight-line basis.

·; Performance periods for TSR measurement purposes will be the three consecutive financial years of the Company starting with that in which an award is granted. Relative TSR performance will be assessed by comparing the Group's average total returns for the last three months of the financial year immediately preceding that in which an award is granted with that for the last three months of the relevant performance period. This will be compared to the total returns of the FTSE 250 Index constituents (excluding financial services) for the same periods, or such other suitable comparator group / index as the Remuneration Committee shall determine from time to time.

·; Provided that TSR has grown in absolute terms by 5% or more over the performance period, using the same basis of measurement as described above, then for the portion of the award subject to the TSR measure:

(i) 30% will vest if the Group's TSR equals that of FTSE 250 Index(1) constituents (excluding financial services);

(ii) 100% will vest if the Group's TSR performance is at the upper quartile or above; and

(iii) if TSR performance is between these points, vesting will occur on a straight-line basis.

For the avoidance of doubt, no part of the award subject to the TSR measure shall vest unless the Group's TSR has grown by 5% over the period, measured as described above, regardless of performance against the FTSE 250 Index(2) constituents.

·; The ROCE performance measure will be measured from 31 March 2014 to 31 March 2016. For the portion of the award subject to the ROCE measure:

(i) 30% will vest if the average ROCE achieved over the three year period is 10% p.a;

(ii) 100% will vest if the average ROCE achieved over the three year period is 11.5% p.a.; and

(iii) If ROCE performance is between these levels, vesting will occur on a straight-line basis.

For these purposes, ROCE will be defined as: Adjusted net operating profit after tax divided into Capital Employed being the Total Assets from the audited balance sheet of the Group less current liabilities (excluding debt).

(1) Or that of the comparator group / index that has been selected

(2) Or that of the comparator group / index that has been selected

Enquiries

RedleafPolhill

Emma Kane/Rebecca Sanders-Hewett

+44 (0) 20 7382 4730

[email protected]

Entertainment One Ltd.

Giles Willits

Via Redleaf Polhill