STARZ ENTERTAINMENT CORP /CN/

Currency and Interest Rate Risk Management

Market risks relating to our operations result primarily from changes in interest rates and, to a lesser extent, changes in foreign currency exchange rates. Our exposure to interest rate risk results primarily from variable-rate borrowings under our debt arrangements, while our exposure to foreign currency exchange rate risk relates to transactions denominated in currencies other than the U.S. Dollar. As part of our overall risk management program, we evaluate our exposure to changes in interest rates and foreign currency exchange rates on an ongoing basis and may utilize derivative financial instruments to manage identified risks.

Interest Rate Risk. Certain of our borrowings, primarily borrowings under our credit facilities, are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on this variable rate indebtedness would increase even though the amount borrowed remained the same, and our net loss would increase. The Company’s objective is to mitigate the impact of interest rate changes on earnings and cash flows and has entered into $150.0 million worth of pay-fixed interest rate exchange swaps to facilitate its interest rate risk management activities. Pay-fixed swaps effectively convert floating-rate borrowings to fixed-rate borrowings. Refer to Note 12, Derivative Instruments and Hedging Activities, for further details.

Currency Rate Risk. The Company is exposed to foreign currency exchange rate fluctuations related to certain programming, production and operating costs denominated in foreign currencies. However, the Company does not believe that foreign currency exchange rate fluctuations represent a material market risk as of September 30, 2026.

Our variable interest rate production loans incur SOFR-based interest of 6.3%.

At September 30, 2026, our Term Loan A had an outstanding carrying value of $357.0 million, with a fair value of $362.4 million, and our 5.5% Senior Notes had an outstanding carrying value of $320.7 million, with a fair value of $277.1 million.

The following table presents information about our financial instruments that are sensitive to changes in interest rates. The table also presents the cash flows of the principal amounts of the financial instruments, and related weighted-average interest rates by expected maturity or required principal payment dates and the fair value of the instrument as of September 30, 2026: