EFTA01366600.pdf

Amendment #4 Page 171 of 868 cgItt.F.M1 taxable income and the expected timing of the reversals ci existing temporary differences In arnving at these Judgments the weight gven to the potential effect of all paatrve and negative evidence it commensurate with the extent towhich it can be obiecnvely vented 'AP believe ix, tax peahens are in compliance with applicable tax laws and regitatons Tax benef s are recognized only for tax paeans that are more likely than not to te sustained upon exameetion by tea authantes The amount recognized is measured as the largest &newt of benefit that is greater then 50% likely to be realized upon tamale settlement We believe that our liableres for uvecconeed tax benefit inctudirg related awed, are adequate in ration to the potential for additional tax assessments There is a risk however, that the amount ultmately paid upon resolution of audits could be mentally differed from the arouses previously included in our stone tax expense and, therefore. could rase a metenal impact on our tax erasion, net more and cash flows. Common stock befuetion We are regured to etiolate the far value of the cornrow stock when performing the far value calculators The law value of the restricted Mares was demented by ow board of °recta's, with input from management are cortemporaneous ntd-party valuated-is We behave that our board of (erectors hes de relevant expenence and expertise to determine the far value dots common Mack Gwen the absence of a ionic tradng market of our common stock and in accordance with the Arnerken Instate. of Certified Retitle AccoulaMs Accountry and Valuation Gude Valuation of R.varaµNSW Company Equity Securities Issued as Canpensaaco ow board d direclors exercised reasonable Judgment and considered numerals abjectly< and subrectrm factors to determine the best estimate of Me far value of our common stock includrg • conterrporaneous valuators performed by unrelated tried-party spectalists, • cur operatag and franca! performance. current business cordibons and pitiedcm, • Nang of key personnel and the experenoe of our management • cur stage or development stage of moted scone ens construction and revenue arrangements! • likelihood of achieving a Nudity event, such as an wheel pitlic dewing a a sale of the company, • lack of marketability of ow common stock • the market performance of comparabe public's, traded companies and • United States and global captal market cantons In valung our camera, stock. ow board of threads determined the equity value of our business wary the inccme approach valuation method. The income approach estimates value based on the expectation of facie cash flows that a company will generate. These haure cash flows are discounted to their present values rang a discount rate denied from an analysis of the cost d capital of compared, publicly traded companies in our inamby or sass lines of business as d the vahaton date and are adjusted to reflect the risks inherent in ou• cash flows Once we cletemsned an equty value, we used the Probability Weighted Expected Return Method, or 'PWERM' to allccale ar equty value among the venous outcomes Under the PVvERM, the value of equty is estimated 163 http://cfdocs.btogo.com:27638/cf/drv7/pub/edgar/2015/07/20/0001193125-15-256461/d78... 7/20/2015 CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0058128 CONFIDENTIAL SONY GM_00204312 EFTA01366600