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UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549



FORM 10-K

(Mark One)ý

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended April 1, 2010ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period
from                           to


Commission file number 1-33344



MARQUEE HOLDINGS INC.(Exact name of registrant as specified in its charter)

Delaware(State or other jurisdiction of
incorporation or organization)

77-0642885(I.R.S. Employer
Identification No.)920 Main
Kansas City, Missouri(Address of principal executive offices)

64105(Zip Code)


Registrant's
telephone number, including area code:(816) 221-4000



Securities
registered pursuant to Section 12(b) of the Act:None



Securities
registered pursuant to Section 12(g) of the Act:None.

Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes o    No ý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. Yes o    No ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes ý    No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulations S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period
that the registrant was required to submit such files). Yes o    No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter)
is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. ý

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o

Accelerated filer o

Non-accelerated filer ý (Do not check if a
smaller reporting company)

Smaller reporting company o


Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Act). Yes o    No ý

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at
which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter.

No
voting stock of Marquee Holdings Inc. is held by non-affiliates of Marquee Holdings Inc.

Title of each class of common stock

Number of shares Outstanding as of May 7, 2010Common Stock, 1¢ par value

1


DOCUMENTS INCORPORATED BY REFERENCENone



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MARQUEE HOLDINGS INC.

FORM 10-K

FOR THE FISCAL YEAR ENDED APRIL 1, 2010    INDEX



PagePART IItem 1.

Business


4Item 1A.

Risk Factors


17Item 1B.

Unresolved Staff Comments


25Item 2.

Properties


25Item 3.

Legal Proceedings


25Item 4.

Reserved


27PART IIItem 5.

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities


27Item 6.

Selected Financial Data


28Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations


29Item 7A.

Quantitative and Qualitative Disclosures about Market Risk


45Item 8.

Financial Statements and Supplementary Data


47Item 9.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure


114Item 9A(T).

Controls and Procedures


114Item 9B.

Other Information


114PART IIIItem 10.

Directors, Executive Officers and Corporate Governance


115Item 11.

Executive Compensation


120Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters


138Item 13.

Certain Relationships and Related Transactions, and Director Independence


142Item 14.

Principal Accounting Fees and Services


146PART IVItem 15.

Exhibits, Financial Statement Schedules


148


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Forward Looking Statements

In addition to historical information, this Annual Report on Form 10-K contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. The
words "forecast," "estimate," "project," "intend," "expect," "should," "believe" and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve
known and unknown risks, uncertainties, assumptions and other factors, including those discussed in "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of
Operations of Marquee Holdings Inc.," which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed
or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, the following:



This
list of factors that may affect future performance and the accuracy of forward-looking statements is illustrative but not exhaustive. In addition, new risks and uncertainties may
arise from time to time. Accordingly, all forward-looking statements should be evaluated with an understanding of their inherent uncertainty.

Except
as required by law, we assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ
materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

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PART I

Item 1.    Business

(a)   General Development of Business

Marquee Holdings Inc. ("Holdings" or the "Company") is organized as a holding company with no operations of its own. Holdings was incorporated on
July 16, 2004. We conduct our business through our subsidiaries including AMC Entertainment Inc. ("AMC Entertainment" or "AMCE"). AMCE's principal directly owned subsidiaries are
American Multi-Cinema, Inc. ("AMC"), and AMC Entertainment International, Inc. ("AMCEI"). We conduct our theatrical exhibition business through AMC and its subsidiaries and AMCEI.

AMCE
is a wholly owned subsidiary of Marquee Holdings Inc., an investment vehicle owned through AMC Entertainment Holdings, Inc. ("Parent") by J.P. Morgan
Partners, LLC ("JPMP"), Apollo Management, L.P. and certain related investments funds ("Apollo") and affiliates of Bain Capital Partners ("Bain"). The Carlyle Group ("Carlyle") and
Spectrum Equity Investors ("Spectrum") (collectively with JPMP and Apollo the "Sponsors").

AMCE
was founded in Kansas City, Missouri in 1920. AMCE was incorporated under the laws of the state of Delaware on June 13, 1983. We maintain our principal executive offices at
920 Main Street, Kansas City, Missouri 64105. Our telephone number at such address is (816) 221-4000. Our Internet address is www.amctheatres.com. Our Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and current reports on Form 8-K, and amendments to these Reports are available free of charge on our
Internet website under the heading "Investor relations" as soon as practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission.

(b)   Financial Information about Segments

In both fiscal 2010 and 2009, we identified one reportable segment for our theatrical exhibition operations. Previously, we had three operating segments which
consisted of United States and Canada Theatrical Exhibition, International Theatrical Exhibition, and Other. The reduction in the number of operating segments was a result of the disposition of
Cinemex in December 2008. Cinemex was previously reported in the International Theatrical Exhibition operating segment and accounted for a substantial majority of that segment. In addition, in fiscal
2009, we consolidated the Other operating
segment with the United States and Canada Theatrical Exhibition operating segment due to a previous contribution of advertising net assets to National CineMedia, LLC ("NCM"). In fiscal 2009,
the United States and Canada Theatrical Exhibition operating segment was renamed the Theatrical Exhibition operating segment. Certain prior period information has been reclassified to conform to the
current period presentation.

For
information about our operating segment, see Note 15Operating Segment to the Consolidated Financial Statements under Part II Item 8 of this Annual
Report on Form 10-K.

(c)   Narrative Description of Business

We are one of the world's leading theatrical exhibition companies based on a number of measures, including total revenues, total number of screens and annual
attendance. For the fiscal year ended April 1, 2010, AMCE had revenues of $2,417,739,000 and earnings from continuing operations of $77,324,000. As of April 1, 2010, we owned, operated
or held interests in 297 theatres with a total of 4,513 screens, approximately 99% of which were located in the United States and Canada. Our theatres are primarily located in large urban markets in
which we have a strong market position relative to our competition. As of April 1, 2010, we operated 81 IMAX screens, which made us the largest IMAX exhibitor in the world and we operated 594
digital screens, 475 of which were equipped with RealD 3D capabilities.

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We
have improved and plan to continue to invest in the quality of our theatre circuit by adding new screens through new builds (including expansions) and acquisitions, by repurposing
theatres to incorporate new concepts and technologies and by disposing of older screens through closures and sales. For instance, in the last two fiscal years we have invested $58,200,000 to introduce
new sight and sound platforms (IMAX, 3D, Enhanced Theatre Experience ("ETX")) and new food and beverage concepts including in-theatre dining, all of which provide our customers an enhanced
movie-going experience significantly differentiated from traditional offerings. We contributed 342 digital projection systems that we owned to Digital Cinema Implementation Partners, LLC on
March 10, 2010 as part of our initial investment in DCIP of $21,768,000.

The
following table provides detail with respect to Digital, IMAX, 3D and deployment of our expanded food and beverage offerings as deployed throughout our circuit on April 1,
2010.

Format

Theatres

Screens

Planned
Fiscal 2011
Screen
DeploymentDigital


262


594


1,150 - 1,2503D


250


475


550 - 650IMAX


81


81


25 - 30ETX


4


4


20 - 25In-theatre dining


3


20


40 - 60


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The
following table provides detail with respect to the geographic location of our Theatrical Exhibition circuit as of April 1, 2010:

Theatrical Exhibition

Theatres(1)

Screens(1)California


42


651Texas


22


437Florida


21


368New Jersey


23


304Illinois


18


271New York


25


267Michigan


11


194Arizona


9


183Georgia


11


177Pennsylvania


12


142Washington


13


141Massachusetts


10


129Maryland


12


127Missouri


9


123Virginia


7


113Ohio


5


86Colorado


4


74Louisiana


5


68Minnesota


4


64North Carolina


3


60Oklahoma


3


60Kansas


2


48Connecticut


2


36Indiana


2


28Nebraska


1


24District of Columbia


3


22Kentucky


1


20Wisconsin


1


18Arkansas


1


16South Carolina


1


14Utah


1


9Canada


8


184China (Hong Kong)(2)


2


13France


1


14United Kingdom


2


28Total Theatrical Exhibition


297


4,513


(1)Included
in the above table are eight theatres and 83 screens that we manage or in which we have a partial interest.(2)In
Hong Kong, we maintain a partial interest represented by a license agreement for use of our trademark.


We
have improved the quality of our theatre circuit by adding new screens through new builds (including expansions) and acquisitions, by transforming theatres to incorporate new concepts
and technologies, and by disposing of older screens through closures and sales. As of April 1, 2010, 3,505, or approximately 78%, of our screens were located in megaplex theatres. Our average
number of

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screens
per theatre as of April 1, 2010 was 15.2, which was more than twice the National Association of Theatre Owners average of 6.9 for calendar year 2009 and higher than any of our peer
competitors.

We
were founded in 1920 and since that time have pioneered many of the industry's most important innovations, including the multiplex theatre format in the early 1960s and the North
American megaplex theatre format in the mid-1990s. In addition, we have acquired some of the most respected companies in the theatrical exhibition industry, including Loews and General
Cinema and subsequent to the end of fiscal year 2010, Kerasotes. We have a demonstrated track record of successfully integrating those companies through timely conversion to AMC's operating
procedures, headcount reductions, consolidation of corporate functions and adoption of best practices.

The
following table sets forth historical information of AMC Entertainment, on a continuing operations basis, concerning new builds (including expansions), acquisitions and dispositions
and end of period operated theatres and screens through April 1, 2010:

New Builds

Acquisitions

Closures/Dispositions

Total TheatresFiscal Year

Number of
Theatres

Number of
Screens

Number of
Theatres

Number of
Screens

Number of
Theatres

Number of
Screens

Number of
Theatres

Number of
Screens2006


7


106


116


1,363


7


60


335


4,7702007


7


107


2


32


26


243


318


4,6662008


9


136








18


196


309


4,6062009


6


83








8


77


307


4,6122010


1


6








11


105


297


4,51330


438


118


1,395


70


681


Subsequent
to April 1, 2010, we completed our acquisition of Kerasotes, as more fully described under "Mergers and Acquisitions," which will increase our theatre and screen count
by 83 and 812, respectively.

We
have also created and invested in a number of allied businesses and strategic initiatives that have created differentiated viewing formats and experiences, greater variety in food and
beverage options and value appreciation for our Company. We believe these initiatives will continue to generate incremental value for our Company in the future. For example:



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Disposition of International Theatrical Exhibition Operating Segment

From fiscal 2006 to fiscal 2009 we disposed of the theatres owned and operated by us in Japan, Hong Kong, Spain, Portugal and Mexico,
as well as all joint venture ownership interests in international theatres in Argentina, Brazil, Chile, Uruguay and Spain. The operations and cash flows of these theatres have been eliminated from our
ongoing operations as a result of the dispositions. We do not have any significant continuing involvement in these theatres. The results of operations of those theatres owned and operated by us have
been classified as discontinued operations for all periods presented.

Mergers and Acquisitions

In January 2006, Holdings merged with LCE Holdings Inc. ("LCE Holdings"), the parent of Loews Cineplex Entertainment Corporation
("Loews"), with Holdings continuing as the holding company for the merged businesses, and Loews merged with and into AMC Entertainment, with AMCE continuing after the merger (the "Merger," and
collectively, the "Mergers"). Operating results of the acquired theatres are included in our consolidated statements of operations from January 26, 2006.

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On
June 11, 2007, Marquee Merger Sub Inc. ("merger sub"), a wholly-owned subsidiary of Parent, merged with and into Holdings, with Holdings continuing as the surviving
corporation (the "holdco merger"). As a result of the holdco merger, (i) Holdings became a wholly owned subsidiary of Parent, a newly formed entity controlled by the Sponsors, (ii) each
share of Holdings' common stock that was issued and outstanding immediately prior to the effective time of the holdco merger was automatically converted into the right to receive a substantially
identical share of common stock of Parent, and (iii) as
further described in this report, each of Holdings' governance agreements was superseded by a substantially identical governance agreement entered into by and among Parent, the Sponsors and our other
stockholders. The holdco merger was effected by the Sponsors to facilitate a previously announced debt financing by Parent and a related dividend to Holdings' stockholders.

On
December 9, 2009, we entered into a definitive agreement with Kerasotes ShowPlace Theatres, LLC ("Kerasotes") to acquire substantially all of the assets of Kerasotes.
Kerasotes operated 95 theatres and 972 screens in mid-sized, suburban and metropolitan markets, primarily in the Midwest. More than three quarters of the Kerasotes theatres feature stadium
seating and almost 90 percent have been built since 1994. On May 24, 2010, we completed the acquisition. The purchase price for the Kerasotes theatres paid in cash at closing was
$275,000,000 and is subject to working capital and other purchase price adjustments as described in the Unit Purchase Agreement.

Our Competitive Strengths

There are several principal characteristics of our business that we believe make us a particularly effective competitor in our industry
and position us well for future growth. These include:



Major Market Position.We are one of the world's leading theatrical exhibition companies by having broad major market
diversification and leading
market share within our markets. As of April 1, 2010, 94% of our screens were in the top 50 Designated Market Areas as defined by Nielsen Media Research ("DMAs") and 79% were in the top
25 DMAs. We operated in 23 of the top 25 DMAs and had the number one or two market share in each of the top 15 DMAs, including New York City, Los Angeles, Chicago, Philadelphia,
San Francisco and Boston. In certain of our densely populated urban markets, we believe there is scarcity of attractive retail real estate opportunities, which enhances the strategic value of our
existing theatres. We believe that customers in our major markets are more affluent and culturally diverse as compared to those in smaller markets. During fiscal 2010, 59% of all U.S. box office
receipts derive from the top 25 DMAs and 75% derive from the top 50 DMAs, our major market presence makes our theatres more highly visible and more important to content providers who
rely on our markets for a disproportionate share of box office receipts.

Traditionally,
the population densities, affluence and ethnic and cultural diversity of top DMAs have created a greater opportunity to exhibit a broad array of film genres, which
we believe drives higher levels of attendance at our theatres as compared to theatres in less densely populated markets. Historically, this has produced the highest per screen and per theatre
operating metrics among the group consisting of us and Regal Entertainment Group and Cinemark Holdings, Inc., the companies we view as our peers. We believe our strong presence in major markets
positions us well relative to our peer competitors to take advantage of opportunities for incremental revenues associated with operating a digital theatre circuit, such as alternative content, given
our patrons' interest in a broader array of content offerings. We also believe the complexity inherent in operating in these major markets is a deterrent to other less sophisticated competitors,
protecting our share position in-market.

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Modern, Highly Productive Theatre Circuit.We are an industry leader in the development and operation of megaplex theatres,
typically defined as a
theatre having 14 or more screens and offering amenities to enhance the movie-going experience, such as stadium seating providing unobstructed viewing, digital sound, enhanced seat design and a
variety of food and beverage offerings. As of April 1, 2010, 3,505, or approximately 78%, of our screens were located in megaplex theatres. Over the past five years we invested approximately
$656,374,000 to improve and expand our theatre circuit, contributing to the modern portfolio of theatres we operate today.

We
believe the combination of our market and operating strategies enables us to deliver industry-leading theatre level operating metrics. For the fiscal year ended April 1, 2010,
our theatre exhibition circuit produced attendance per average theatre of 679,000 (approximately 19% higher than our closest peer competitor) and revenues per average theatre of $8.2 million
(approximately 52% higher than our closest peer competitor).

As
of April 1, 2010, we had installed 594 digital projectors in our existing theatre base. We intend to continue our rapid deployment of digital projectors through our
arrangements with DCIP. We intend to install 1,150 to 1,250 more digital projectors in fiscal 2011. We believe that our theatre circuit will be further enhanced with the installation of digital
projection systems in our theatres. We believe operating a digital theatre circuit will provide us with greater flexibility in exhibiting our content, which we expect will enhance our capacity
utilization, enable us to achieve higher ticket prices for
differentiated content formats such as 3D, and provide incremental revenue from exhibition of alternative content such as live concerts, sporting events, Broadway shows and opera.

We
believe our circuit is better positioned than our competitors to benefit from broader and more diverse food and beverage offerings. During fiscal 2010, we introduced proprietary food
and beverage offerings that can be deployed across our theatre circuit depending upon the needs and unique circumstances of each theatre. At the lowest capital investment, Concession Freshen engages
the traditional guest with better assortment and more appealing signage and merchandising fixtures. Concession Stand of the Future introduces a more efficient transaction-focused post-pay
format in addition to significantly expanded stock-keeping units. During the past two fiscal years, we also introduced in-theatre dining concepts featuring Fork & Screen, a casual
in-theatre dining and entertainment experience;Cinema
Suites, a premium, upscale in-theatre dining and entertainment option andMacGuffins, a bar and lounge
area.

Strong Cash Flow Generation.The U.S. theatrical exhibition industry has a long-term history of steady box office growth, even
during
times of economic downturn. When combined with our major market focus and highly productive theatre assets, we have been able to generate significant and stable cash flow provided by operating
activities. For the fiscal year ended April 1, 2010, our net cash provided by operating activities totaled $228,951,000. In future years, we expect to continue to generate cash flow sufficient
to allow us to grow our revenues, maintain our facilities, invest in our business and service our debt.

Proven Management Team.Our management team has a unique combination of industry experiences and skill-sets, equipping them to
effectively execute our strategies in an increasingly complex business environment. Our CEO's broad experience in a number of Consumer Packaged Goods ("CPG") and entertainment-related businesses
expands AMC's growth perspectives well beyond traditional theatrical exhibition and has increased our focus on providing more value to our guests. Recent additions, including a Chief Marketing Officer
("CMO") and heads of Food & Beverage, Programming and Development/Real Estate augment our deep bench of industry experience with additional skill-sets and diverse expertise. The expanded
breadth of our management team complements the established team known for operational excellence and a demonstrated history of innovation and industry consolidation.

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Our Strategy

Our strategy is rooted in our mission to drive social relevance by providing our guests with a compelling entertainment experience
while at the same time leading our industry in financial and operating metrics. Our strategy is driven by the following key elements:



Optimize our Theatres.We will continue to broaden our content offerings through the installation of additional IMAX, ETX and 3D
systems, present
attractive alternative content and enhance our food and beverage offerings.



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Maximizing Guest Engagement and Loyalty.In addition to differentiating the AMC movie-going experience by deploying new sight
and sound formats and
food and beverage concepts, we are also focused on creating differentiation through guest marketing. We have had success in the past and intend to generate incremental attendance and revenues in the
future by maximizing guest engagement and loyalty through a number of initiatives. Chief among these are:



Maximize Operating Efficiencies.We believe that the size of our circuit, major market concentration and the breadth of our
operations will allow us
to continue to achieve economies of scale and drive continued improvement in operating margins. Our operating strategies are focused in these areas:



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Film Licensing

We predominantly license "first-run" motion pictures from distributors owned by major film production companies and from
independent distributors. We license films on a film-by-film and theatre-by-theatre basis. We obtain these licenses based on several factors, including
number of seats and screens available for a particular picture, revenue potential and the location and condition of our theatres. We pay rental fees on a negotiated basis.

During
the period from 1990 to 2009, the annual number of first-run motion pictures released by distributors in the United States ranged from a low of 370 in 1995 to a high
of 633 in 2008, according to the Motion Picture Association 2009 Theatrical Market Statistics.

North
American film distributors typically establish geographic film licensing zones and generally allocate available film to one theatre within each zone. Film zones generally encompass
a radius of three to five miles in metropolitan and suburban markets, depending primarily upon population density. In film zones where we are the sole exhibitor, we obtain film licenses by selecting a
film from among those offered and negotiating directly with the distributor. As of April 1, 2010, approximately 88% of our screens in the United States and Canada were located in film licensing
zones where we are the sole exhibitor.

Licenses
that we enter into typically state that rental fees are based on either aggregate terms established prior to the opening of the picture or on a mutually agreed settlement upon
the conclusion of the picture run. Under an aggregate terms formula, we pay the distributor a specified percentage of box office receipts or pay based on a scale of percentages tied to different
amounts of box office gross. The settlement process allows for negotiation based upon how a film actually performs.

There
are several distributors which provide a substantial portion of quality first-run motion pictures to the exhibition industry. These include Paramount Pictures,
Twentieth Century Fox, Warner Bros. Distribution, Buena Vista Pictures (Disney), Sony Pictures Releasing, and Universal Pictures. Films licensed from these distributors accounted for approximately 84%
of our U.S. and Canadian admissions revenues during fiscal 2010. Our revenues attributable to individual distributors may vary significantly from year to year depending upon the commercial success of
each distributor's motion pictures in any given year. In fiscal 2010, no single distributor accounted for more than 20% of our box office admissions.

Concessions

Concessions sales are our second largest source of revenue after box office admissions. Concessions items include popcorn, soft drinks,
candy, hot dogs and other products. Different varieties of candy and soft drinks are offered at our theatres based on preferences in that particular geographic region. We have also implemented
"combo-meals" for patrons, which offer a pre-selected assortment of concessions products and offer co-branded and private label products that are unique to us.

Our
strategy emphasizes prominent and appealing concessions counters designed for rapid service and efficiency. We design our megaplex theatres to have more concessions capacity to make
it easier to serve larger numbers of customers. Strategic placement of large concessions stands within theatres

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heightens
their visibility, aids in reducing the length of lines, allows flexibility to introduce new concepts and improves traffic flow around the concessions stands.

We
negotiate prices for our concessions products and supplies directly with concessions vendors on a national or regional basis to obtain high volume discounts or bulk rates and
marketing incentives.

Our
entertainment and dining experience at certain theatres features casual and premium upscale in-theatre dining options as well as bar and lounge areas.

Employees

As of April 1, 2010, we employed approximately 800 full-time and 16,000 part-time employees.
Approximately 39% of our U.S. theatre associates were paid the minimum wage.

Fewer
than 2% of our U.S. employees, consisting primarily of motion picture projectionists, are represented by a union, the International Alliance of Theatrical Stagehand Employees and
Motion Picture Machine Operators (and affiliated local unions). We believe that our relationship with this union is satisfactory. We consider our employee relations to be good.

Theatrical Exhibition Industry and Competition

Theatrical exhibition is the primary initial distribution channel for new motion picture releases, and we believe that the theatrical
success of a motion picture is often the most important factor in establishing its value in the other parts of the product life cycle (DVD, cable television and other ancillary markets).

Theatrical
exhibition has demonstrated long-term steady growth. U.S. and Canadian box office revenues increased by a 3.8% Compound Annual Growth Rate ("CAGR") over the last
20 years, driven by increases in both ticket prices and attendance. Ticket prices have grown steadily over the past 20 years, growing at a 3.2% CAGR. In calendar 2009, industry box
office revenues for the United States and Canada were $10,600,000,000, an increase of 10% from calendar 2008.

The
following table represents information about the exhibition industry obtained from the National Association of Theatre Owners ("NATO").

Calendar Year

Box Office
Revenues
(in millions)

Attendance
(in millions)

Average
Ticket
Price

Number of
Theatres

Indoor
Screens

Screens
Per
Theatre2009

$
10,600


1,414

$
7.50


5,561


38,605


6.92008


9,634


1,341


7.18


5,403


38,934


7.22007


9,632


1,400


6.88


5,545


38,159


6.92006


9,170


1,401


6.55


5,543


37,776


6.82005


8,820


1,376


6.41


5,713


37,092


6.5


There
are approximately 816 companies competing in the North American theatrical exhibition industry, approximately 442 of which operate four or more screens. Industry participants vary
substantially in size, from small independent operators to large international chains. Based on information obtained from Rentrak, we believe that the four largest exhibitors (in terms of box office
revenue) generated approximately 54% of the box office revenues in 2009. This statistic is up from 33% in 2000 and is evidence that the theatrical exhibition business in the United States and Canada
has been consolidating. According to NATO, average screens per theatre have increased from 6.5 in 2005 to 6.9 in 2009, which we believe is indicative of the industry's development of megaplex
theatres.

Our
theatres are subject to varying degrees of competition in the geographic areas in which they operate. Competition is often intense with respect to attracting patrons, licensing
motion pictures and finding new theatre sites. Where real estate is readily available, there are few barriers preventing

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another
company from opening a theatre near one of our theatres, which may adversely affect operations at our theatre.

The
theatrical exhibition industry faces competition from other forms of out-of-home entertainment, such as concerts, amusement parks and sporting events, and
from other distribution channels for filmed entertainment, such as cable television, pay per view and home video systems, as well as from all other forms of entertainment.

We
believe the theatrical exhibition industry is and will continue to be attractive for a number of key reasons, including:

A Highly Popular and Affordable Out-of-Home Entertainment Experience.Going to the movies is one of the most popular and
affordable out-of-home entertainment options. In calendar 2009, attendance at indoor movie theatres in United States and Canada was 1,414,000,000. This contrasts to the
119,800,000 combined annual attendance generated by professional baseball, basketball and football over the same time period. The estimated average price of a movie ticket was $7.50 in calendar 2009,
considerably less than other out-of-home entertainment alternatives such as concerts and sporting events.

Long History of Steady Growth.The theatrical exhibition industry is a mature business which has, over an extended period,
produced steady growth in
revenues. The combination of the popularity of movie-going, its steady long-term growth characteristics, industry consolidation that has resulted in more rational capital deployment and
the relative maturity of the business makes theatrical exhibition a highly cash flow generative business today. Box office revenues in the United States and Canada have increased at a 3.8% CAGR over
the last 20 years, driven by increases in both ticket prices and attendance across multiple economic cycles. During this period, the industry experienced short-term variability in
attendance and resulting revenues which we believe were highly correlated to the quality of film product being exhibited. We believe that these long-term trends will continue.

Importance to Content Providers.We believe that the theatrical success of a motion picture is often the key determinant in
establishing its value in
the other parts of the product life cycle, such as DVD, cable television, merchandising and other ancillary markets. As a result, we believe motion picture studios will continue to work cooperatively
with theatrical exhibitors to ensure the continued value of the theatrical window.

Adoption of Digital Technology.The theatrical exhibition industry is in the initial stages of conversion from film-based to
digital
projection technology. Virtually all filmed entertainment content today can be exhibited digitally. Digital projection results in a premium visual experience for patrons as there is no degradation of
image over the life of a film. Digital content also gives the theatre operator greater flexibility in programming content. For example, theatre operators are able to better address capacity
utilization and meet demand in their theatres by making real-time decisions on the number and size of auditoriums to program with content. Moreover, digital technology provides theatres
with the opportunity for additional revenues through 3D
and alternative content offerings. Recent experience with digital has produced increased attendance and average ticket prices. For example, theatres are able to charge $1 to $5 more per ticket for a
3D film than for a standard 2D film. Furthermore, 3D screens have generated approximately 40% more in attendance than standard 2D versions of the same movie. Digital technology also facilitates live
and pre-recorded networked and single-site meetings and corporate events in movie theatres and will allow for the distribution of live and pre-recorded
entertainment content and the sale of associated sponsorships.

Regulatory Environment

The distribution of motion pictures is, in large part, regulated by federal and state antitrust laws and has been the subject of
numerous antitrust cases. The consent decrees resulting from one of those cases, to which we were not a party, have a material impact on the industry and us. Those consent

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decrees
bind certain major motion picture distributors and require the motion pictures of such distributors to be offered and licensed to exhibitors, including us, on a
film-by-film and theatre-by-theatre basis. Consequently, we cannot assure ourselves of a supply of motion pictures by entering into
long-term arrangements with major distributors, but must compete for our licenses on a film-by-film and theatre-by-theatre basis.

Our
theatres must comply with Title III of the Americans with Disabilities Act of 1990 (the "ADA"). Compliance with the ADA requires that public accommodations "reasonably accommodate"
individuals with disabilities and that new construction or alterations made to "commercial facilities" conform to accessibility guidelines unless "structurally impracticable" for new construction or
technically infeasible for alterations. Non-compliance with the ADA could result in the imposition of injunctive relief, fines, and awards of damages to private litigants or additional
capital expenditures to remedy such noncompliance. Although we believe that our theatres are in substantial compliance with the ADA, in January 1999 the Civil Rights Division of the Department of
Justice, or the Department, filed suit against us alleging that certain of our theatres with stadium-style seating violate the ADA. In separate rulings in 2002 and 2003, the court ruled against us in
the "line of sight" and the "non-line of sight" aspects of this case. In 2003, the court entered a consent order and final judgment about the non-line of sight aspects of this
case. On December 5, 2008, the Ninth Circuit Court of Appeals reversed the trial court as to the appropriate remedy and remanded the case back to the trial court for findings consistent with
its decision. AMCE and the Department are negotiating the extent of betterments related to the remaining remedies required for line-of-sight violations consistent with the
Ninth Circuit's decision. Absent settlement, the case will be tried in February 2011. See Part I Item 3Legal Proceedings of this Annual Report on
Form 10-K.

As
an employer covered by the ADA, we must make reasonable accommodations to the limitations of employees and qualified applicants with disabilities, provided that such reasonable
accommodations do not pose an undue hardship on the operation of our business. In addition, many of our employees are covered by various government employment regulations, including minimum wage,
overtime and working conditions regulations.

Our
operations also are subject to federal, state and local laws regulating such matters as construction, renovation and operation of theatres as well as wages and working conditions,
citizenship, health and sanitation requirements and licensing. We believe our theatres are in material compliance with such requirements.

We
also own and operate theatres and other properties which may be subject to federal, state and local laws and regulations relating to environmental protection. Certain of these laws
and regulations may impose joint and several liability on certain statutory classes of persons for the costs of investigation or remediation of contamination, regardless of fault or the legality of
original disposal. We believe our theatres are in material compliance with such requirements.

Seasonality

Our revenues are dependent upon the timing of motion picture releases by distributors. The most marketable motion pictures are usually
released during the summer and the year-end holiday seasons. Therefore, our business is highly seasonal, with higher attendance and revenues generally occurring during the summer months
and holiday seasons. Our results of operations may vary significantly from quarter to quarter.

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(d)   Financial Information About Geographic Areas

For information about the geographic areas in which we operate, see Note 15Operating Segment to the Consolidated Financial Statements under
Part II Item 8 of this Annual Report on Form 10-K. During fiscal 2010, revenues from our theatre operations outside the United States accounted for 4% of our total
revenues. There are significant differences between the theatrical exhibition industry in the United States and in these international markets.

(e)   Available Information.

We make available on our web site (www.amctheatres.com) under "Investor ResourcesSEC Filings" free of charge, Holdings' and AMCE's annual reports on
Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports as soon as reasonably practicable after
we electronically file or furnish such material with the Securities and Exchange Commission. In addition, the public may read and copy any materials that we file with the Securities and Exchange
Commission at the Securities and Exchange Commission Public Reference Room at 100 F Street, NW, Washington, DC 20549. The public may obtain information about the operation of the Public
Reference
Room by calling the Securities and Exchange Commission at 1-800-SEC-0330.

Item 1A.

RISK FACTORS

Risks Related to Our Business

Our substantial debt could adversely affect our operations and prevent us from satisfying those debt obligations.

We have a significant amount of debt. As of April 1, 2010, we had $2,130,935,000 of outstanding indebtedness. As of
April 1, 2010, our subsidiaries had approximately $3,883,632,000 of undiscounted rental payments under operating leases (with initial base terms of between 15 and 20 years).

The
amount of our indebtedness and lease and other financial obligations could have important consequences to you. For example, it could:



If
we fail to make any required payment under our senior secured credit facility or to comply with any of the financial and operating covenants contained therein, we would be in default.
Lenders under our senior secured credit facility could then vote to accelerate the maturity of the indebtedness under the senior secured credit facility and foreclose upon the stock and personal
property of our subsidiaries that is pledged to secure the senior secured credit facility. Other creditors might then accelerate other indebtedness. If the lenders under the senior secured credit
facility accelerate the maturity of the indebtedness thereunder, we might not have sufficient assets to satisfy our obligations under the senior

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secured
credit facility or our other indebtedness. See "Management's Discussion and Analysis of Financial Condition and Results of Operations of AMC EntertainmentLiquidity and Capital
Resources."

Our
indebtedness under our senior secured credit facility bears interest at rates that fluctuate with changes in certain prevailing interest rates (although, subject to certain
conditions, such rates may be fixed for certain periods). If interest rates increase, we may be unable to meet our debt service obligations under our senior secured credit facility and other
indebtedness.

We have had significant financial losses in recent years.

Prior to fiscal 2007, AMC Entertainment had reported net losses in each of the last nine fiscal years totaling approximately
$510,088,000. For fiscal 2007 and 2008, AMCE reported net earnings of $134,079,000 and $43,445,000, respectively. AMCE reported a net loss of $81,172,000 in fiscal 2009 and net earnings of $69,790,000
in fiscal 2010. If we experience losses in the future, we may be unable to meet our payment obligations while attempting to expand our theatre circuit and withstand competitive pressures or adverse
economic conditions.

We face significant competition for new theatre sites, and we may not be able to build or acquire theatres on terms favorable to us.

We anticipate significant competition from other exhibition companies and financial buyers when trying to acquire theatres, and there
can be no assurance that we will be able to acquire such theatres at reasonable prices or on favorable terms. Moreover, some of these possible buyers may be stronger financially than we are. In
addition, given our size and market share, as well as our recent experiences with the Antitrust Division of the United States Department of Justice in connection with the acquisition of Kerasotes and
prior acquisitions, we may be required to dispose of theatres in connection with future acquisitions that we make. As a result of the foregoing, we may not succeed in acquiring theatres or may have to
pay more than we would prefer to make an acquisition.

Acquiring or expanding existing circuits and theatres may require additional financing, and we cannot be certain that we will be able to obtain new financing on favorable
terms, or at all.

Our net capital expenditures aggregated approximately $97,011,000 for fiscal 2010. We estimate that our planned capital expenditures
will be between $120,000,000 and $150,000,000 in fiscal 2011. Actual capital expenditures in fiscal 2011 may differ materially from our estimates. We may have to seek additional financing or issue
additional securities to fully implement our growth strategy. We cannot be certain that we will be able to obtain new financing on favorable terms, or at all. In addition, covenants under our existing
indebtedness limit our ability to incur additional indebtedness, and the performance of any additional theatres may not be sufficient to service the related indebtedness that we are permitted to
incur.

We may be reviewed by antitrust authorities in connection with acquisition opportunities that would increase our number of theatres in markets where we have a leading market
share.

Given our size and market share, pursuit of acquisition opportunities that would increase the number of our theatres in markets where
we have a leading market share would likely result in significant review by the Antitrust Division of the United States Department of Justice, and we may be required to dispose of theatres in order to
complete such acquisition opportunities. For example, in connection with the acquisition of Kerasotes, we are required to dispose of 11 theatres located in various markets across the United States,
including Chicago, Denver and Indianapolis. As a result, we may not be able to succeed in acquiring other exhibition companies or we may have to dispose of a significant number of theatres in key
markets in order to complete such acquisitions.

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The agreements governing our indebtedness contain covenants that may limit our ability to take advantage of certain business opportunities advantageous to us.

The agreements governing our indebtedness contain various covenants that limit our ability to, among other
things:



These
restrictions could limit our ability to obtain future financing, make acquisitions or needed capital expenditures, withstand economic downturns in our business or the economy in
general, conduct operations or otherwise take advantage of business opportunities that may arise.

Although
the indentures for our notes contain a fixed charge coverage test that limits our ability to incur indebtedness, this limitation is subject to a number of significant exceptions
and qualifications. Moreover, the indentures do not impose any limitation on our incurrence of capital or finance lease obligations or liabilities that are not considered "Indebtedness" under the
indentures (such as operating leases), nor do they impose any limitation on the amount of liabilities incurred by subsidiaries, if any, that might be designated as "unrestricted subsidiaries," which
are subsidiaries that we designate, that are not subject to the restrictive covenants contained in the indentures governing our notes. Furthermore, there are no restrictions in the indentures on our
ability to invest in other entities (including unaffiliated entities) and no restrictions on the ability of our subsidiaries to enter into agreements restricting their ability to pay dividends or
otherwise transfer funds to us. Also, although the indentures limit our ability to make restricted payments, these restrictions are subject to significant exceptions and qualifications.

We may not generate sufficient cash flow from our theatre acquisitions to service our indebtedness.

In any acquisition, we expect to benefit from cost savings through, for example, the reduction of overhead and theatre level costs, and
from revenue enhancements resulting from the acquisition. However, there can be no assurance that we will be able to generate sufficient cash flow from these acquisitions to service any indebtedness
incurred to finance such acquisitions or realize any other anticipated benefits. Nor can there be any assurance that our profitability will be improved by any one or more acquisitions. Any acquisition
may involve operating risks, such as:



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If our cash flows prove inadequate to service our debt and provide for our other obligations, we may be required to refinance all or a portion of our existing debt or future
debt at terms unfavorable to us.

Our ability to make payments on and refinance our debt and other financial obligations and to fund our capital expenditures and
acquisitions will depend on our ability to generate substantial operating cash flow. This will depend on our future performance, which will be subject to prevailing economic conditions and to
financial, business and other factors beyond our control. As of August 16, 2007, Holdings began paying cash interest on its 12% senior discount notes due 2014 and made its first
semi-annual cash interest payment on February 15, 2008. Holdings' ability to service the 12% senior discount notes due 2014 is subject to the restrictions on distributions from AMCE
contained in our senior secured credit facility and the indentures governing AMCE's debt securities. The maximum amount AMCE was permitted to distribute to Holdings in compliance with its senior
secured credit facility and the indentures governing AMCE's debt securities was approximately $309,752,000 as of April 1, 2010.

In
addition, our notes require us to repay or refinance those notes when they come due. If our cash flows were to prove inadequate to meet our debt service, rental and other obligations
in the future, we may be required to refinance all or a portion of our existing or future debt, on or before maturity, to sell assets or to obtain additional financing. We cannot assure you that we
will be able to refinance any of our indebtedness, including our senior secured credit facility, sell any such assets or obtain additional financing on commercially reasonable terms or at all.

The
terms of the agreements governing our indebtedness restrict, but do not prohibit us from incurring additional indebtedness. If we are in compliance with the financial covenants set
forth in the senior secured credit facility and our other outstanding debt instruments, we may be able to incur substantial additional indebtedness. If we incur additional indebtedness, the related
risks that we face may intensify.

Our investment in and revenues from NCM may be negatively impacted by the competitive environment in which NCM operates.

We have maintained an investment in NCM. NCM's in-theatre advertising operations compete with other cinema advertising
companies and other advertising mediums including, most notably, television, newspaper, radio and the Internet. There can be no guarantee that in-theatre advertising will continue to
attract major advertisers or that NCM's in-theatre advertising format will be favorably received by the theatre-going public. If NCM is unable to generate expected sales of advertising, it
may not maintain the level of profitability we hope to achieve, its results of operations and cash flows may be adversely affected and our investment in and revenues and dividends from NCM may be
adversely impacted.

We may suffer future impairment losses and lease termination charges.

The opening of large megaplexes by us and certain of our competitors has drawn audiences away from some of our older, multiplex
theatres. In addition, demographic changes and competitive pressures have caused some of our theatres to become unprofitable. As a result, we may have to close certain theatres or recognize impairment
losses related to the decrease in value of particular theatres. We review long-lived assets, including intangibles, for impairment as part of our annual budgeting process and whenever
events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. We recognized non-cash impairment losses in 1996 and in each

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fiscal
year thereafter except for 2005. AMC Entertainment's impairment losses from continuing operations over this period aggregated to $285,044,000. Beginning fiscal 1999 through April 1,
2010, AMC Entertainment also incurred theatre and other closure expenses, including theatre lease termination charges aggregating approximately $56,217,000. Deterioration in the performance of our
theatres could require us to recognize additional impairment losses and close additional theatres, which could have an adverse effect on the results of our operations.

Our international and Canadian operations are subject to fluctuating currency values.

As of April 1, 2010, we owned, operated or held interests in megaplexes in Canada, China (Hong Kong), France and the United
Kingdom. Because the results of operations and the financial position of our foreign operations are reported in their respective local currencies and then translated into U.S. dollars at the
applicable exchange rates for inclusion in our consolidated financial statements, our financial results are impacted by currency fluctuations between the dollar and those local currencies. Revenues
from our theatre operations outside the United States accounted for 4% of our total revenues during the 52 weeks ended April 1, 2010. As a result of our international operations, we have
risks from fluctuating currency values. As of April 1, 2010, a 10% fluctuation in the value of the U.S. dollar against all foreign currencies of countries where we currently operate theatres
would either increase or decrease loss before income taxes and accumulated other comprehensive loss by approximately $722,000 and $8,345,000, respectively. We do not currently hedge against foreign
currency exchange rate risk.

We must comply with the ADA, which could entail significant cost.

Our theatres must comply with Title III of the Americans with Disabilities Act of 1990, or ADA. Compliance with the ADA requires that
public accommodations "reasonably accommodate" individuals with disabilities and that new construction or alterations made to "commercial facilities" conform to accessibility guidelines unless
"structurally impracticable" for new construction or technically infeasible for alterations. Non-compliance with the ADA could result in the imposition of injunctive relief, fines, and an
award of damages to private litigants or additional capital expenditures to remedy such noncompliance.

On
January 29, 1999, the Civil Rights Division of the Department of Justice, or the Department, filed suit alleging that AMC Entertainment's stadium-style theatres violated the
ADA and related regulations. On December 5, 2003, the trial court entered a consent order and final judgment on non-line-of-sight issues under which AMC
Entertainment agreed to remedy certain violations at its stadium-style theatres and at certain theatres it may open in the future. Currently we estimate that betterments related to
non-line of sight remedies will be required at approximately 140 stadium-style theatres. AMC Entertainment estimates that the total cost of these betterments will be approximately
$54,000,000 and through April 1, 2010 AMCE has incurred approximately $33,355,000 of these costs. See Part I Item 3Legal Proceedings of this Annual Report on
Form 10-K.

We are party to significant litigation.

We are subject to a number of legal proceedings and claims that arise in the ordinary course of our business. We cannot be assured that
we will succeed in defending any claims, that judgments will not be entered against us with respect to any litigation or that reserves we may set aside will be adequate to cover any such judgments. If
any of these actions or proceedings against us is successful, we may be subject to significant damages awards. For a description of our legal proceedings, see Part I
Item 3Legal Proceedings of this Annual Report on Form 10-K.

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We may be subject to liability under environmental laws and regulations.

We own and operate facilities throughout the United States and manage or own facilities in several foreign countries and are subject to
the environmental laws and regulations of those jurisdictions, particularly laws governing the cleanup of hazardous materials and the management of properties. We might in the future be required to
participate in the cleanup of a property that we own or lease, or at which we have been alleged to have disposed of hazardous materials from one of our facilities. In certain circumstances, we might
be solely responsible for any such liability under environmental laws, and such claims could be material.

We may not be able to generate additional ancillary revenues.

We intend to continue to pursue ancillary revenue opportunities such as advertising, promotions and alternative uses of our theatres
during non-peak hours. Our ability to achieve our business objectives may depend in part on our success in increasing these revenue streams. Some of our U.S. and Canadian competitors have
stated that they intend to make significant capital investments in digital advertising delivery, and the success of this delivery system could make it more difficult for us to compete for advertising
revenue. In addition, in March 2005 we contributed our cinema screen advertising business to NCM. As such, although we retain board seats and an ownership interest in NCM, we do not control this
business, and therefore do not control our revenues attributable to cinema screen advertising. We cannot assure you that we will be able to effectively generate additional ancillary revenue and our
inability to do so could have an adverse effect on our business and results of operations.

If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results.

Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. Because of
inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. In the past, we have identified a material
weakness in our internal control over financial reporting and concluded that our disclosure controls and procedures were ineffective. In addition, we may in the future discover areas of our internal
controls that need improvement or that constitute material weaknesses. A material weakness is a control deficiency or combination of control deficiencies that results in more than a remote likelihood
that a material misstatement of annual or interim financial statements will not be prevented or detected. Any failure to remediate any future material weaknesses in our internal control over financial
reporting or to implement and maintain effective internal controls, or difficulties encountered in their implementation, could cause us to fail to timely meet our reporting obligations, result in
material misstatements in our financial statements or could
result in defaults under our senior secured credit facility, the indentures governing our debt securities or under any other debt instruments we may enter into in the future. Deficiencies in our
internal controls could also cause investors to lose confidence in our reported financial information.

We depend on key personnel for our current and future performance.

Our current and future performance depends to a significant degree upon the retention of our senior management team and other key
personnel. The loss or unavailability to us of any member of our senior management team or a key employee could have a material adverse effect on our business, financial condition and results of
operations. We cannot assure you that we would be able to locate or employ qualified replacements for senior management or key employees on acceptable terms.

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Risks Related to Our Industry

We have no control over distributors of the films and our business may be adversely affected if our access to motion pictures is limited or delayed.

We rely on distributors of motion pictures, over whom we have no control, for the films that we exhibit. Major motion picture
distributors are required by law to offer and license film to exhibitors, including us, on a film-by-film and theatre-by-theatre basis. Consequently, we
cannot assure ourselves of a supply of motion pictures by entering into long-term arrangements with major distributors, but must compete for our licenses on a
film-by-film and theatre-by-theatre basis. Our business depends on maintaining good relations with these distributors, as this affects our ability to
negotiate commercially favorable licensing terms for first-run films or to obtain licenses at all. Our business may be adversely affected if our access to motion pictures is limited or
delayed because of deterioration in our relationships with one or more distributors or for some other reason. To the extent that we are unable to license a popular film for exhibition in our theatres,
our operating results may be adversely affected.

We depend on motion picture production and performance.

Our ability to operate successfully depends upon the availability, diversity and appeal of motion pictures, our ability to license
motion pictures and the performance of such motion pictures in our markets. We license first-run motion pictures, the success of which has increasingly depended on the marketing efforts of
the major motion picture studios. Poor performance of, or any disruption in the production of these motion pictures (including by reason of a strike or lack of adequate financing), or a reduction in
the marketing efforts of the major motion picture studios, could hurt our business and results of operations. In addition, a change in the type and breadth of movies offered by motion picture studios
may adversely affect the demographic base of moviegoers.

We are subject, at times, to intense competition.

Our theatres are subject to varying degrees of competition in the geographic areas in which we operate. Competitors may be national
circuits, regional circuits or smaller independent exhibitors. Competition among theatre exhibition companies is often intense with respect to the following factors:



The
theatrical exhibition industry also faces competition from other forms of out-of-home entertainment, such as concerts, amusement parks and sporting events and
from other distribution channels for filmed entertainment, such as cable television, pay per view and home video systems and from other forms of in-home entertainment.

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Industry-wide screen growth has affected and may continue to affect the performance of some of our theatres.

In recent years, theatrical exhibition companies have emphasized the development of large megaplexes, some of which have as many as 30
screens in a single theatre. The industry-wide strategy of aggressively building megaplexes generated significant competition and rendered many older, multiplex theatres obsolete more
rapidly than expected. Many of these theatres are under long-term lease commitments that make closing them financially burdensome, and some companies have elected to continue operating
them notwithstanding their lack of profitability. In other instances, because theatres are typically limited use design facilities, or for other reasons, landlords have been willing to make rent
concessions to keep them open. In recent years many older theatres that had closed are being reopened by small theatre operators and in some instances by sole proprietors that are able to negotiate
significant rent and other concessions from landlords. As a result, there has been growth in the number of screens in the U.S. and Canadian exhibition industry from 2005 to 2008. This has affected and
may continue to affect the performance of some of our theatres. The number of screens in the U.S. and Canadian exhibition industry slightly declined from 2008 to 2009.

An increase in the use of alternative film delivery methods or other forms of entertainment may drive down our attendance and limit our ticket prices.

We compete with other film delivery methods, including network, syndicated cable and satellite television, DVDs and video cassettes, as
well as video-on-demand, pay-per-view services and downloads via the Internet. We also compete for the public's leisure time and disposable income with
other forms of entertainment, including sporting events, amusement parks, live music concerts, live theatre and restaurants. An increase in the popularity of these alternative film delivery methods
and other forms of entertainment could reduce attendance at our theatres, limit the prices we can charge for admission and materially adversely affect our business and results of operations.

Our results of operations may be impacted by shrinking video release windows.

Over the last decade, the average video release window, which represents the time that elapses from the date of a film's theatrical
release to the date a film is available on DVD, an important downstream market, has decreased from approximately six months to approximately three to four months. If patrons choose to wait for a DVD
release rather than attend a theatre for viewing the film, it may adversely impact our business and results of operations, financial condition and cash flows. Film studios are currently considering a
premium video on demand product which could also cause the release window to shrink further. We cannot assure you that this release window, which is determined by the film studios, will not shrink
further or be eliminated altogether, which could have an adverse impact on our business and results of operations.

Development of digital technology may increase our capital expenses.

The industry is in the process of converting film-based media to digital-based media. We, along with some of our
competitors, have commenced a roll-out of digital equipment for exhibiting feature films and plan to continue the roll-out through our joint venture DCIP. However, significant
obstacles exist that impact such a roll-out plan, including the cost of digital projectors, and the supply of projectors by manufacturers. During fiscal 2010, DCIP completed its formation
and $660 million funding to facilitate the financing and deployment of digital technology in our theatres. We cannot assure you that DCIP will be able to obtain sufficient additional financing
to be able to purchase and lease to us the number of digital projectors ultimately needed for our roll-out or that the manufacturers will be able to supply the volume of projectors needed
for our roll-out. As a result, our roll-out of digital equipment could be delayed or not completed at all.

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General political, social and economic conditions can reduce our attendance.

Our success depends on general political, social and economic conditions and the willingness of consumers to spend money at movie
theatres. If going to motion pictures becomes less popular or consumers spend less on concessions, which accounted for 27% of our revenues in fiscal 2010, our operations could be adversely affected.
In addition, our operations could be adversely affected if consumers' discretionary income falls as a result of an economic downturn. Political events, such as terrorist attacks, could cause people to
avoid our theatres or other public places where large crowds are in attendance.

Item 1B.    Unresolved Staff Comments.

Not applicable.

Item 2.    Properties.

The following table sets forth the general character and ownership classification of our theatre circuit, excluding unconsolidated
joint ventures and managed theatres, as of April 1, 2010:

Property Holding Classification

Theatres

ScreensOwned


11


109Leased pursuant to ground leases


7


87Leased pursuant to building leases


271


4,234Total


289


4,430


Our
theatre leases generally have initial terms ranging from 15 to 20 years, with options to extend the lease for up to 20 additional years. The leases typically require
escalating minimum annual rent payments and additional rent payments based on a percentage of the leased theatre's revenue above a base amount and require us to pay for property taxes, maintenance,
insurance and certain other property-related expenses. In some instances our escalating minimum annual rent payments are contingent upon increases in the consumer price index. In some cases, our
rights as tenant are subject and subordinate to the mortgage loans of lenders to our lessors, so that if a mortgage were to be foreclosed, we could lose our lease. Historically, this has never
occurred.

We
lease our corporate headquarters in Kansas City, Missouri.

Currently,
the majority of the concessions, projection, seating and other equipment required for each of our theatres are owned. In the future we expect the majority of our digital
projection equipment will be leased from DCIP.

Item 3.    Legal Proceedings.

The Company, in the normal course of business, is party to various legal actions. Except as described below, management believes that
the potential exposure, if any, from such matters would not have a material adverse effect on the financial condition, cash flows or results of operations of the Company.

United States of America v. AMC Entertainment Inc. and American Multi Cinema, Inc.(No. 99 01034 FMC (SHx), filed in
the U.S. District Court for the Central District of California). On January 29, 1999, the Department filed suit alleging that AMCE's stadium-style theatres violated the ADA and related
regulations. The Department alleged that AMCE had failed to provide persons in wheelchairs seating arrangements with lines-of-sight comparable to the general public. The
Department alleged various non-line-of-sight violations as well. The Department sought declaratory and injunctive relief

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regarding
existing and future theatres with stadium-style seating, compensatory damages in the approximate amount of $75,000 and a civil penalty of $110,000.

As
to line-of-sight matters, the trial court entered summary judgment in favor of the Department as to both liability and as to the appropriate remedy. On
December 5, 2008, the Ninth Circuit Court of Appeals reversed the trial court as to the appropriate remedy and remanded the case back to the trial court for findings consistent with its
decision. AMCE and the Department are negotiating the extent of betterments related to the remaining remedies required for line-of-sight violations consistent with the Ninth
Circuit's decision. The improvements will likely be made over a five-year term. Absent settlement, the case will be tried in February 2011. AMCE has recorded a liability of approximately $349,000 for
estimated fines related to this matter.

As
to the non-line-of-sight aspects of the case, on January 21, 2003, the trial court entered summary judgment in favor of the Department on
matters such as parking areas, signage, ramps, location of toilets, counter heights, ramp slopes, companion seating and the location and size of handrails. On December 5, 2003, the trial court
entered a consent order and final judgment on non-line-of-sight issues under which AMCE agreed to remedy certain violations at its stadium-style theatres and at
certain theatres it may open in the future. Currently AMCE estimates that these betterments will be required at approximately 140 stadium-style theatres. AMCE estimates that the total cost of these
betterments will be approximately $54,000,000, and through April 1, 2010 AMCE has incurred approximately $33,355,000 of these costs. The estimate is based on actual costs incurred on
remediation work completed to date. The actual costs of betterments may vary based on the results of surveys of the remaining theatres.

Michael Bateman v. American Multi-Cinema, Inc.(No. CV07-00171). In January 2007, a class action complaint was filed
against AMC in the Central District of the United States District Court of California (the "District Court") alleging violations of the Fair and Accurate Credit Transactions Act ("FACTA"). FACTA
provides in part that neither expiration dates nor more than the last five numbers of a credit or debit card may be printed on receipts given to customers. FACTA imposes significant penalties upon
violators where the violation is deemed to have been willful. Otherwise damages are limited to actual losses incurred by the card holder. On October 24, 2008, the District Court denied
plaintiff's renewed motion for class certification. Plaintiff has appealed this decision to the Ninth Circuit Court of Appeals and the case is stayed pending this appeal.

On
May 14, 2009, Harout Jarchafjian filed a similar lawsuit alleging that AMC willfully violated FACTA and seeking statutory damages, but without alleging any actual injury
(Jarchafjian v. American Multi-Cinema, Inc.(C.D. Cal. Case No. CV09-03434). The Jarchafjian case has been deemed related to the
Bateman case and is stayed pending a Ninth Circuit decision in the Bateman case. The Company believes the plaintiff's allegations in both these cases, particularly those asserting AMC's willfulness,
are without merit.

Union Sponsored Pension Plan.On November 7, 2008, the Company received notice of a written demand for payment of a partial
withdrawal
liability assessment from a collectively bargained multiemployer pension plan that covers certain of its unionized theatre employees. Based on a payment schedule that the Company received from this
plan in December 2008, the Company began making quarterly payments on January 1, 2009 related to the $5,279,000 in partial withdrawal liability. In the second quarter of fiscal 2010, the
Company made a complete withdrawal from the plan which triggered an additional liability of $1,422,000 which was assessed by the plan on April 19, 2010. However, the Company also estimates that
approximately $2,839,000 of the total liability was discharged in bankruptcy by companies it acquired. As of April 1, 2010, the Company has recorded a liability related to this matter in the
amount of $4,016,000 and has made contributions including interest charges of approximately $2,905,000. The final withdrawal liability amount may be adjusted based on a legal review of the plan's
assessment, the Company's records and ensuing discussions with the plan's trustees.

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Item 4.    Reserved.

PART II

Item 5.    Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Our common equity consists of Common Stock. There is currently no established public trading market for our Common Stock.

Common Stock

On May 7, 2010, there was one stockholder of record of our Common Stock, AMC Entertainment Holdings, Inc.

During
April and May of 2009, Holdings made dividend payments to its stockholder, Parent, totaling $300,000,000, which were treated as a reduction of additional paid-in
capital. Parent made payments to purchase term loans and reduced the principal balance of its term loan facility from $466,936,000 to $193,290,000 with a portion of the dividend proceeds.

During
September of 2009 and March of 2010, Holdings used cash received from AMCE to pay a dividend distribution to Parent in an aggregate amount of $723,000 and $158,000, respectively.
Parent used the available funds to pay corporate overhead expenses incurred in the ordinary course of business.

Issuer Purchase of Equity Securities

There were no repurchases of Holding's Common Stock during the thirteen weeks ended April 1, 2010.

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Item 6.    Selected Financial Data.

Years Ended(1)(3)52 Weeks
Ended
April 1,
2010

52 Weeks
Ended
April 2,
2009

53 Weeks
Ended
April 3,
2008

52 Weeks
Ended
March 29,
2007

52 Weeks
Ended
March 30,
2006(4)(in thousands, except operating data)Statement of Operations Data:Revenues:Admissions

$
1,711,853

$
1,580,328

$
1,615,606

$
1,576,924

$
1,125,243Concessions


646,716


626,251


648,330


631,924


448,086Other revenue


59,170


58,908


69,108


94,374


90,631Total revenues


2,417,739


2,265,487


2,333,044


2,303,222


1,663,960Costs and Expenses:Film exhibition costs


928,632


842,656


860,241


838,386


604,393Concession costs


72,854


67,779


69,597


66,614


48,845Operating expense


610,774


576,022


572,740


564,206


436,028Rent


440,664


448,803


439,389


428,044


326,627General and administrative:Merger, acquisition and transactions costs


2,383


652


6,372


12,447


12,523Management fee


5,000


5,000


5,000


5,000


2,000Other


57,964


53,747


39,177


45,860


38,296Restructuring charge














3,980Depreciation and amortization


188,342


201,413


222,111


228,437


158,098Impairment of long-lived assets


3,765


73,547


8,933


10,686


11,974Total costs and expenses


2,310,378


2,269,619


2,223,560


2,199,680


1,642,764Other income


(2,559
)

(14,139
)

(12,932
)

(10,267
)

(9,818
)Interest expense:Corporate borrowings


156,420


145,657


160,902


214,539


136,932Capital and financing lease obligations


5,652


5,990


6,505


4,669


3,937Equity in (earnings) losses of non-consolidated entities(7)


(30,300
)

(24,823
)

(43,019
)

(233,704
)

7,807Investment income(8)


(240
)

(1,731
)

(23,923
)

(17,594
)

(3,333
)Earnings (loss) from continuing operations before income taxes


(21,612
)

(115,086
)

21,951


145,899


(114,329
)Income tax provision (benefit)


(68,800
)

5,800


1,020


28,246


70,660Earnings (loss) from continuing operation


47,188


(120,886
)

20,931


117,653


(184,989
)Earnings (loss) from discontinued operations, net of income tax provision(2)


(7,534
)

9,728


1,802


(746
)

(31,234
)Net earnings (loss)

$
39,654

$
(111,158
)
$
22,733

$
116,907

$
(216,223
)Balance Sheet Data (at period end):Cash and equivalents

$
497,948

$
536,580

$
108,717

$
319,533

$
232,366Corporate borrowings


2,073,649


1,928,736


1,856,467


1,864,670


2,455,686Other long-term liabilities


309,591


308,703


350,498


373,943


395,458Capital and financing lease obligations


57,286


60,709


69,983


53,125


68,130Stockholder's equity


546,098


826,178


917,416


1,167,053


1,042,642Total assets


3,683,204


3,756,741


3,879,007


4,118,149


4,407,351Other Data:Net cash provided by operating activities(6)

$
228,951

$
168,096

$
201,676

$
417,870

$
25,694Capital expenditures


(97,011
)

(121,456
)

(171,100
)

(142,969
)

(123,838
)Proceeds from sale/leasebacks


6,570











35,010Screen additions


6


83


136


107


106Screen acquisitions











32


1,363Screen dispositions


105


77


196


243


60Average screenscontinuing operations(5)


4,485


4,545


4,561


4,627


3,583Number of screens operated


4,513


4,612


4,606


4,666


4,770Number of theatres operated


297


307


309


318


335Screens per theatre


15.2


15.0


14.9


14.7


14.2Attendance (in thousands)continuing operations(5)


200,285


196,184


207,603


213,041


161,867


(1)Cash
dividends declared on common stock for fiscal 2010, 2009 and 2008 were $300,881,000, $3,349,000 and $270,588,000, respectively. There were no other
cash dividends declared on common stock.


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(2)All
fiscal years presented includes earnings and losses from discontinued operations related to 44 theatres in Mexico that were sold during fiscal 2009.
Both fiscal 2007 and 2006 includes losses from discontinued operations related to five theatres in Japan that were sold during fiscal 2006 and five theatres in Iberia that were sold during fiscal
2007.(3)Fiscal
2008 includes 53 weeks. All other years have 52 weeks.(4)We
acquired Loews Cineplex Entertainment Corporation on January 26, 2006, which significantly increased our size. In the Loews acquisition we
acquired 112 theatres with 1,308 screens throughout the United States that we consolidate.(5)Includes
consolidated theatres only.(6)Cash
flows provided by operating activities for the 52 weeks ended March 30, 2006 do not include $142,512,000 of cash acquired in the Mergers
which is included in cash flows from investing activities.(7)During
fiscal 2010, fiscal 2009 and fiscal 2008, equity in earnings including cash distributions from NCM were $34,436,000, $27,654,000 and $22,175,000,
respectively. During fiscal 2008, equity in (earnings) losses of non-consolidated entities includes a gain of $18,751,000 from the sale of Hoyts General Cinema South America and during
fiscal 2007 a gain of $238,810,000 related to the NCM, Inc. intial public offering.(8)Includes
gain of $15,977,000 for the 53 weeks ended April 3, 2008 from the sale of our investment in Fandango, Inc. Includes interest
income on temporary cash investments of $17,258,000 for the 52 weeks ended March 29, 2007.


Item 7.   Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion relates to the audited financial statements of Marquee Holdings Inc., included elsewhere in this
Form 10-K. This discussion contains forward-looking statements. Please see "Forward-Looking Statements" for a discussion of the risks, uncertainties and assumptions relating to
these statements.

Overview

We are one of the world's leading theatrical exhibition companies. As of April 1, 2010, we owned, operated or had interests in
297 theatres and 4,513 screens with 99%, or 4,458, of our screens in the U.S. and Canada, and 1%, or 55 of our screens in China (Hong Kong), France and the United Kingdom.

Our
principal directly owned subsidiaries are AMC Entertainment Inc. ("AMCE"), American Multi-Cinema, Inc. ("AMC") and AMC Entertainment International, Inc.
("AMCEI"). We conduct our theatrical exhibition business through AMC and its subsidiaries and AMCEI and its subsidiaries.

During
the fifty-two weeks ended April 1, 2010, we closed 11 theatres with 105 screens in the United States and opened one new managed theatre with six screens in the
United States pursuant to a joint venture arrangement resulting in a circuit total of 297 theatres and 4,513 screens.

Our
Theatrical Exhibition revenues are generated primarily from box office admissions and theatre concession sales. The balance of our revenues are generated from ancillary sources,
including on-screen advertising, rental of theatre auditoriums, fees and other revenues generated from the sale of gift cards and packaged tickets, on-line ticket fees and
arcade games located in theatre lobbies.

Box
office admissions are our largest source of revenue. We predominantly license "first-run" motion pictures from distributors owned by major film production companies and
from independent distributors. We license films on a film-by-film and theatre-by-theatre basis. Film exhibition costs are accrued based on the
applicable admissions revenues and estimates of the final settlement pursuant to our film licenses. Licenses that we enter into typically state that rental fees are based on either aggregate terms
established prior to the opening of the picture or on a mutually agreed settlement upon the conclusion of the picture run. Under an aggregate terms formula, we pay the distributor a specified
percentage of box office receipts or pay based on a scale of percentages tied to different amounts of box office gross. The settlement process allows for negotiation based upon how a film actually
performs.

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Concessions
sales are our second largest source of revenue after box office admissions. Concessions items include popcorn, soft drinks, candy, hot dogs and other products. We negotiate
prices for our concessions products and supplies directly with concessions vendors on a national or regional basis to obtain high volume discounts or bulk rates and marketing incentives.

Our
revenues are dependent upon the timing and popularity of motion picture releases by distributors. The most marketable motion pictures are usually released during the summer and the
year-end holiday seasons. Therefore, our business is highly seasonal, with higher attendance and revenues generally occurring during the summer months and holiday seasons. Our results of
operations will vary significantly from quarter to quarter.

During
fiscal 2010, films licensed from our six largest distributors based on revenues accounted for approximately 84% of our U.S. and Canada admissions revenues. Our revenues
attributable to individual distributors may vary significantly from year to year depending upon the commercial success of each distributor's motion pictures in any given year.

During
the period from 1990 to 2009, the annual number of first-run motion pictures released by distributors in the United States ranged from a low of 370 in 1995 to a high
of 633 in 2008, according to the Motion Picture Association of America 2009 MPAA Theatrical Market Statistics. The number of digital 3D films released increased to a high of 20 in 2009 from a low of 0
during this same time period.

We
continually upgrade the quality of our theatre circuit by adding new screens through new builds (including expansions) and acquisitions and by disposing of older screens through
closures and sales. We are an industry leader in the development and operation of megaplex theatres, typically defined as a theatre having 14 or more screens and offering amenities to enhance the
movie-going experience, such as stadium seating providing unobstructed viewing, digital sound and enhanced seat design. We have increased our 3D screens by 331 to 475 screens and our IMAX screens by
40 to 81 screens during the fifty-two weeks ended April 1, 2010; and as of April 1, 2010, approximately 10.5% of our screens were 3D screens and 1.8% were IMAX screens.

Significant Events

On March 10, 2010, Digital Cinema Implementation Partners, LLC ("DCIP") completed its financing transactions for the
deployment of digital projection systems to nearly 14,000 movie theatre screens across North America, including screens operated or managed by AMC Entertainment, Cinemark Holdings, Inc. and
Regal Entertainment Group. At closing we contributed 342 projection systems that we owned to DCIP, which we recorded at estimated fair value as part of an additional investment in DCIP of $21,768,000.
We also made cash investments in DCIP of $840,000 at closing and DCIP made a distribution of excess cash to us after the closing date and prior
to year-end of $1,262,000. We recorded a loss on contribution of the 342 projection systems of $563,000, based on the difference between estimated fair value and our carrying value on the date of
contribution. On March 26, 2010, we acquired 117 digital projectors from third party lessors for $6,784,000 and sold them together with seven digital projectors that we owned to DCIP for
$6,570,000. We recorded a loss on the sale of these 124 systems to DCIP of $697,000. As of April 1, 2010, we operated 568 digital projection systems leased from DCIP pursuant to operating
leases and anticipate that we will have deployed 4,000 of these systems in our existing theatres over the next three to four years. The additional digital projection systems will allow us to
add additional 3D screens to our circuit where we are generally able to charge a higher admission price than 2D. The digital projection systems leased from DCIP and its affiliates will replace most of
our existing 35 millimeter projection systems in our U.S. theatres. We are examining the estimated depreciable lives for our existing equipment that will be replaced and expect to accelerate the
depreciation of these existing 35 millimeter projection systems, based on the estimated digital projection system deployment timeframe.

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On
December 9, 2009, we entered into a definitive agreement with Kerasotes pursuant to which we acquired substantially all of the assets of Kerasotes. Kerasotes operated 95
theatres and 972 screens in mid-sized, suburban and metropolitan markets, primarily in the Midwest. More than three quarters of the Kerasotes theatres feature stadium seating and almost
90 percent have been built since 1994. On May 24, 2010, we completed the acquisition. The purchase price for the Kerasotes theatres paid in cash at closing was $275,000,000 and is
subject to working capital and other purchase price adjustments as described in the Unit Purchase Agreement.

On
June 9, 2009, we completed the offering of $600,000,000 aggregate principal amount of our 8.75% Senior Notes due 2019 (the "Notes due 2019"). Concurrently with the initial
notes offering, we launched a cash tender offer and consent solicitation for any and all of our then outstanding $250,000,000 aggregate principal amount of 85/8% Senior Notes due 2012
(the "Fixed Notes due 2012") at a purchase price of $1,000 plus a $30 consent fee for each $1,000 of principal amount of currently outstanding Fixed Notes due 2012 validly tendered and accepted by us
on or before the early tender date (the "Cash Tender Offer"). We used the net proceeds from the issuance of the Notes due 2019 to pay the consideration for the Cash Tender Offer plus accrued and
unpaid interest on the $238,065,000 principal amount of the Fixed Notes due 2012. We recorded a loss on extinguishment related to the Cash Tender Offer of $10,826,000 in Other expense during the
fifty-two weeks ended April 1, 2010, which included previously capitalized deferred financing fees of $3,312,000, consent fee paid to holders of $7,142,000, and other expenses of
$372,000. On August 15, 2009, we redeemed the remaining $11,935,000 of Fixed Notes due 2012 at a price of $1,021.56 per $1,000 principal in accordance with the terms of the indenture. We
recorded a loss of $450,000 in Other expense related to the extinguishment of the remaining Fixed Notes due 2012 principal during the fifty-two weeks ended April 1, 2010, which
included previously capitalized deferred financing fees of $157,000, a consent fee paid to the holder of $257,000 and other expenses of $36,000.

We
acquired Grupo Cinemex, S.A. de C.V. ("Cinemex") in January 2006 as part of a larger acquisition of Loews Cineplex Entertainment Corporation. We do not operate any other theatres in
Mexico and have divested of the majority of our other investments in international theatres in Japan, Hong Kong, Spain, Portugal, Argentina, Brazil, Chile, and Uruguay over the past several years as
part of our overall business strategy.

On
December 29, 2008, we sold all of our interests in Cinemex, which then operated 44 theatres with 493 screens primarily in the Mexico City Metropolitan Area, to Entretenimiento
GM de Mexico S.A. de C.V. ("Entretenimiento"). The purchase price received at the date of the sale and in accordance with the Stock Purchase Agreement was $248,141,000. During the year ended
April 1, 2010, we received payments of $4,315,000 for purchase price related to tax payments and refunds, and a working capital calculation and post closing adjustments. Additionally, we
estimate that we are contractually entitled to receive an additional $8,752,000 of the purchase price related to tax payments and refunds. While we believe we are entitled to these amounts from
Cinemex, the collection will require litigation which was initiated by us on April 30, 2010. Resolution could take place over a prolonged period. As a result of the litigation, we have
established an allowance for doubtful accounts related to this receivable in the amount of $7,480,000 and further directly charged off $1,381,000 of certain amounts as uncollectible with an offsetting
charge of $8,861,000 recorded to loss on disposal included as a component of discontinued operations.

The
operations and cash flows of the Cinemex theatres have been eliminated from our ongoing operations as a result of the disposal transaction. We do not have any significant continuing
involvement in the operations of the Cinemex theatres. The results of operations of the Cinemex theatres have been classified as discontinued operations for all periods presented.

In
May 2007, we disposed of our investment in Fandango, accounted for using the cost method, for total proceeds of $20,360,000, of which $17,977,000 was received in May and September
2007 and

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$2,383,000
was received in November 2008, and have recorded a gain on the sale, included in investment income, of approximately $15,977,000 during fiscal 2008 and $2,383,000 during fiscal 2009. In
July 2007 we disposed of our investment in HGCSA, an entity that operated 17 theatres in South America, for total proceeds of approximately $28,682,000 and recorded a gain on the sale, included in
equity earnings of non-consolidated entities, of approximately $18,751,000.

Critical Accounting Estimates

The accounting estimates identified below are critical to our business operations and the understanding of our results of operations.
The impact of, and any associated risks
related to, these estimates on our business operations are discussed throughout this Management's Discussion and Analysis of Financial Condition and Results of Operations where such estimates affect
our reported and expected financial results. For a detailed discussion on the application of these estimates and other accounting policies, see the notes to Holdings' Consolidated Financial Statements
included elsewhere in this Annual Report on Form 10-K. The methods and judgments we use in applying our accounting estimates have a significant impact on the results we report in
our financial statements. Some of our accounting estimates require us to make difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently
uncertain. Our most critical accounting estimates include the assessment of recoverability of long-lived assets, including intangibles, which impacts impairment of long-lived
assets when we impair assets or accelerate their depreciation; recoverability of goodwill, which creates the potential for write-offs of goodwill; recognition and measurement of current
and deferred income tax assets and liabilities, which impacts our tax provision; recognition and measurement of net periodic benefit costs for our pension and other defined benefit programs, which
impacts general and administrative expense; and estimation of film settlement terms and measurement of film rental fees which impacts film exhibition costs.

Impairments.We review long-lived assets, including definite-lived intangibles, investments in non-consolidated subsidiaries
accounted for under the equity method, marketable equity securities and internal use software for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets
may not be fully recoverable. We identify impairments related to internal use software when management determines that the remaining carrying value of the software will not be realized through future
use. We review internal management reports on a quarterly basis as well as monitor current and potential future competition in the markets where we operate for indicators of triggering events or
circumstances that indicate impairment of individual theatre assets. We evaluate theatres using historical and projected data of theatre level cash flow as our primary indicator of potential
impairment and consider the seasonality of our business when making these evaluations. We perform an annual impairment analysis during the fourth quarter because Christmas and New Year's holiday
results comprise a significant portion of our operating cash flow and the actual results from this period, which are available during the fourth quarter of each fiscal year, are an integral part of
our impairment analysis. Under these analyses, if the sum of the estimated future cash flows, undiscounted and without interest charges, are less than the carrying amount of the asset, an impairment
loss is recognized in the amount by which the carrying value of the asset exceeds its estimated fair value. Assets are evaluated for impairment on an individual theatre basis, which we believe is the
lowest level for which there are identifiable cash flows. The impairment evaluation is based on the estimated cash flows from continuing use until the expected disposal date or the fair value of
furniture, fixtures and equipment. The expected disposal date does not exceed the remaining lease period unless it is probable the lease period will be extended and may be less than the remaining
lease period when we do not expect to operate the theatre to the end of its lease term. The fair value of assets is determined as either the expected selling price less selling costs (where
appropriate) or the present value of the estimated future cash flows. The fair value of furniture, fixtures and equipment has been determined using similar asset sales and in some instances the
assistance of third party valuation studies. The discount rate used in determining the present value of the estimated future cash flows was based on

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management's
expected return on assets during fiscal 2010, 2009, and 2008. There is considerable management judgment necessary to determine the future cash flows, fair value and the expected operating
period of a theatre, and, accordingly, actual results could vary significantly from such management estimates, which fall under Level 3 within the fair value measurement hierarchy. See
Note 14Fair Value Measurements to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K. We have recorded impairments of
long-lived assets of $3,765,000, $73,547,000, and $8,933,000 during fiscal 2010, 2009, and 2008, respectively.

Goodwill.Our recorded goodwill was $1,836,731,000 as of April 1, 2010 and April 2, 2009, and unamortized trademark
intangible assets
were $74,000,000 as of April 1, 2010 and April 2, 2009. We evaluate goodwill and our trademark for impairment annually as of the beginning of the fourth fiscal quarter or more frequently
as specific events or circumstances dictate. Our goodwill is recorded in our Theatrical Exhibition operating segment, which is also the reporting unit for purposes of evaluating recorded goodwill for
impairment. If the carrying value of the reporting unit exceeds its fair value, we are required to reallocate the fair value of the reporting unit as if the reporting unit had been acquired
in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. We determine fair value by using an enterprise valuation methodology determined by
applying multiples to cash flow estimates less net indebtedness, which we believe is an appropriate method to determine fair value. There is considerable management judgment with respect to cash flow
estimates and appropriate multiples and discount rates to be used in determining fair value and such management estimates fall under Level 3 within the fair value measurement hierarchy.

We
performed our annual impairment analysis during the fourth quarter of fiscal 2010. The fair value of our Theatrical Exhibition operations exceed the carrying value by more than 10%
and management does not believe that impairment is probable.

Income taxes.In determining income for financial statement purposes, we must make certain estimates and judgments. These estimates and
judgments
occur in the calculation of certain tax liabilities and in the determination of the recoverability of certain of the deferred tax assets, which arise from temporary differences between the tax and
financial statement recognition of revenue and expense as well as operating loss and tax credit carryforwards. We must assess the likelihood that we will be able to recover our deferred tax assets in
each domestic and foreign tax jurisdiction in which we operate. If recovery is not more likely than not, we must record a valuation allowance for the deferred tax assets that we estimate are more
likely than not unrealizable. As of April 1, 2010, we had recorded approximately $104,500,000 of net deferred tax assets (net of valuation allowances of approximately $(302,535,000) related to
the estimated future tax benefits and liabilities of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying consolidated balance sheets, as well
as operating loss and tax credit carryforwards). Our income tax benefit in fiscal 2010 includes the release of $62,218,000 of valuation allowance for deferred tax assets. The recoverability of these
deferred income tax assets is dependent upon our ability to generate future taxable income in the relevant taxing jurisdictions. Projections of future taxable income require considerable management
judgment about future attendance levels, revenues and expenses.

Pension and Postretirement Assumptions.Pension and postretirement benefit obligations and the related effects on operations are
calculated using
actuarial models. Two critical assumptions, discount rate and expected return on assets, are important elements of plan expense and/or liability measurement. We evaluate these critical assumptions at
least annually. In addition, medical trend rates are an important assumption in projecting the medical claim levels for our postretirement benefit plan. Other assumptions affecting our pension and
postretirement obligations involve demographic factors such as retirement, expected increases in compensation, mortality and turnover. These assumptions are evaluated periodically and are updated to
reflect our experience. Actual results in any given year will often differ from actuarial assumptions because of economic and other factors.

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The
discount rate enables us to state expected future cash flows at a present value on the measurement date. A lower discount rate increases the present value of benefit obligations and
increases pension and postretirement expense. For our principal pension plans, a 50 basis point decrease in the discount rate would increase pension expense by approximately $660,000. For our
postretirement plans, a 50 basis point decrease in the discount rate would increase postretirement expense by approximately $33,000. For fiscal 2010, we decreased our discount rate from 7.43% to 6.16%
for our pension plans and from 7.42% to 5.97% for our postretirement benefit plan.

To
determine the expected long-term rate of return on pension plan assets, we consider the current and expected asset allocations, as well as historical and expected returns
on various categories of plan assets obtained from our investment portfolio manager. A 50 basis point decrease in the expected return on assets of our qualified defined benefit pension plan would
increase pension expense on our principal plans by approximately $269,000 per year.

The
annual rate of increase in the per capita cost of covered health care benefits assumed for 2010 was 8.0% for medical and 4.0% for dental and vision. The rates were assumed to
decrease gradually to 5.0% for medical in 2017 and remain at 4.0% for dental. In fiscal 2009 the rates for medical were assumed to decrease gradually to 5.0% for medical in 2012. The health care cost
trend rate assumption has a significant effect on the amounts reported. Increasing the assumed health care cost trend rates by one percentage point in each year would increase the accumulated
postretirement benefit obligation as of April 1, 2010 by $2,204,000 and the aggregate of the service and interest cost components of postretirement expense for fiscal 2010 by $147,000.
Decreasing the assumed health care cost trend rates by one percentage point in each year would decrease the accumulated postretirement obligation for fiscal 2010 by $1,879,000 and the aggregate
service and interest cost components of postretirement expense for fiscal 2010 by $125,000. Note 11Employee Benefit Plans to the Consolidated Financial Statements included
elsewhere in this Annual Report on Form 10-K includes disclosures of our pension plan and postretirement plan assumptions and information about our pension plan assets.

Film Exhibition Costs.We predominantly license "first-run" motion pictures on a film-by-film and
theatre-by-theatre basis from distributors owned by major film production companies and from independent distributors. We obtain these licenses based on several factors,
including number of seats and screens available for a particular picture, revenue potential and the location and condition of our theatres. We pay rental fees on a negotiated basis.

Licenses
that we enter into typically state that rental fees are based on either aggregate terms established prior to the opening of the picture or on a mutually agreed settlement upon
the conclusion of the picture run. Under an aggregate terms formula, we pay the distributor a specified percentage of box office receipts or pay based on a scale of percentages tied to different
amounts of box office gross. The settlement process allows for negotiation based upon how a film actually performs.

We
accrue film exhibition costs based on the applicable box office receipts and estimates of the final settlement pursuant to the film licenses entered into with our distributors.
Generally, less than one third of our quarterly film exhibition cost is estimated at period-end. The length of time until these costs are known with certainty depends on the ultimate
duration of the film play, but is typically "settled" within two to three months of a particular film's opening release. Upon settlement with our film distributors, film cost expense and the related
film cost payable are adjusted to the final film settlement. Such adjustments have been historically insignificant. However, actual film costs and film costs payable could differ materially from those
estimates. For fiscal years 2010, 2009, and 2008 there were no significant changes in our film cost estimation and settlement procedures.

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Operating Results

The following table sets forth our revenues, costs and expenses attributable to our operations. Reference is made to
Note 15Operating Segment to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for additional information therein.

Both
fiscal years 2010 and 2009 include 52 weeks and fiscal year 2008 includes 53 weeks.

(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

53 Weeks
Ended
April 3, 2008RevenuesTheatrical exhibitionAdmissions

$
1,711,853

$
1,580,328

$
1,615,606Concessions


646,716


626,251


648,330Other theatre


59,170


58,908


69,108Total revenues

$
2,417,739

$
2,265,487

$
2,333,044Costs and ExpensesTheatrical exhibitionFilm exhibition costs

$
928,632

$
842,656

$
860,241Concession costs


72,854


67,779


69,597Operating expense


610,774


576,022


572,740Rent


440,664


448,803


439,3892,052,924


1,935,260


1,941,967General and administrative expense:Merger, acquisition and transaction costs


2,383


652


6,372Management fee


5,000


5,000


5,000Other


57,964


53,747


39,177Depreciation and amortization


188,342


201,413


222,111Impairment of long-lived assets


3,765


73,547


8,933Total costs and expenses

$
2,310,378

$
2,269,619

$
2,223,560Operating Data (at period end):Screen additions


6


83


136Screen dispositions


105


77


196Average screenscontinuing operations(1)


4,485


4,545


4,561Number of screens operated


4,513


4,612


4,606Number of theatres operated


297


307


309Screens per theatre


15.2


15.0


14.9Attendance (in thousands)continuing operations(1)


200,285


196,184


207,603


(1)Includes
consolidated theatres only.


We
present Adjusted EBITDA as a supplemental measure of our performance. We define Adjusted EBITDA as earnings (loss) from continuing operations plus (i) income tax provisions
(benefit), (ii) interest expense and (iii) depreciation and amortization, as further adjusted to eliminate the impact of certain items that we do not consider indicative of our ongoing
operating performance. These further adjustments are itemized below. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In
evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Adjusted
EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.

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Reconciliation of Adjusted EBITDA(unaudited)

(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

53 Weeks
Ended
April 3, 2008Earnings (loss) from continuing operations

$
47,188

$
(120,886
)
$
20,931Plus:Income tax provision (benefit)


(68,800
)

5,800


1,020Interest expense


162,072


151,647


167,407Depreciation and amortization


188,342


201,413


222,111Impairment of long-lived assets


3,765


73,547


8,933Certain operating expenses (1)


6,099


1,517


(16,248
)Equity in non-consolidated entities


(30,300
)

(24,823
)

(43,019
)Investment loss (income)


(240
)

(1,731
)

(23,923
)Other (income) expense(2)


11,276





(1,246
)General and administrative expense:Merger, acquisition and transaction costs


2,383


652


6,372Management fee


5,000


5,000


5,000Stock-based compensation expense


1,384


2,622


207Adjusted EBITDA

$
328,169

$
294,758

$
347,545


(1)Amounts
represent preopening expense, theatre and other closure expense (income) and disposition of assets and other gains included in operating expenses.(2)Other
expense for fiscal 2010 is comprised of the loss on extinguishment of indebtedness related to the Cash Tender Offer and remaining redemption. Other
income for fiscal 2008 is comprised of recoveries for property loss related to Hurricane Katrina.


Adjusted
EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net earnings (loss) as an indicator of
operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance with GAAP). Adjusted EBITDA may not be comparable to
similarly titled measures reported by other companies. We have included Adjusted EBITDA because we believe it provides management and investors with additional information to measure our performance
and liquidity, estimate our value and evaluate our ability to service debt. In addition, we use Adjusted EBITDA for incentive compensation purposes.

Adjusted
EBITDA has important limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under
U.S. GAAP. For example, Adjusted EBITDA:



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For the Year Ended April 1, 2010 and April 2, 2009

Revenues.Total revenues increased 6.7%, or $152,252,000, during the year ended April 1, 2010 compared to the year ended
April 2, 2009.
Admissions revenues increased 8.3%, or $131,525,000, during the year ended April 1, 2010 compared to the year ended April 2, 2009, due to a 6.1% increase in average ticket prices and a
2.1% increase in attendance. Admissions revenues at comparable theatres (theatres opened on or before the first quarter of fiscal 2009) increased 8.5%, or $131,470,000, during the year ended
April 1, 2010 from the comparable period last year. The increase in average ticket price was primarily due to increases in attendance from IMAX and 3D film product where we are able to charge
more per ticket than for a standard 2D film, as well as our practice of periodically reviewing ticket prices and making selective adjustments based upon such factors as general inflationary trends and
conditions in local markets. Attendance was positively impacted by more favorable 3D and IMAX film product during the year ended April 1, 2010 as compared to the year ended April 2,
2009, as well as by
an increase in the number of IMAX and 3D screens that we operate. Concessions revenues increased 3.3%, or $20,465,000, during the year ended April 1, 2010 compared to the year ended
April 2, 2009, due primarily to the increase in attendance. Other theatre revenues increased 0.4%, or $262,000, during the year ended April 1, 2010 compared to the year ended
April 2, 2009, primarily due to increases in on-line ticket fees, partially offset by a reduction in theatre rentals.

Costs and expenses.Total costs and expenses increased 1.8%, or $40,759,000 during the year ended April 1, 2010 compared to the
year ended
April 2, 2009. Film exhibition costs increased 10.2%, or $85,976,000, during the year ended April 1, 2010 compared to the year ended April 2, 2009 due to the increase in
admissions revenues and the increase in film exhibition costs as a percentage of admissions revenues. As a percentage of admissions revenues, film exhibition costs were 54.2% in the current period and
53.3% in the prior year period primarily due to an increase in admissions revenues on higher grossing films, which typically carry a higher film cost as a percentage of admissions revenues. Concession
costs increased 7.5%, or $5,075,000, during the year ended April 1, 2010 compared to the year ended April 2, 2009 due to an increase in concession costs as a percentage of concessions
revenues and the increase in concession revenues. As a percentage of concessions revenues, concession costs were 11.3% in the current period compared with 10.8% in the prior period. As a percentage of
revenues, operating expense was 25.3% in the current period as compared to 25.4% in the prior period. Rent expense decreased 1.8%, or $8,139,000, during the year ended April 1, 2010 compared to
the year ended April 2, 2009 primarily due to rent reductions from landlords related to their failure to meet co-tenancy provisions in certain lease agreements and renegotiations on
more favorable terms. Rent reductions related to co-tenancy may not continue should our landlords meet the related co-tenancy provisions in the future.

General and Administrative Expense:

Merger, acquisition and transaction costs.Merger, acquisition and transaction costs increased $1,731,000 during the year ended
April 1, 2010
compared to the year ended April 2, 2009 primarily due to costs incurred related to the Kerasotes acquisition during the current year.

Management fees.Management fees were unchanged during the year ended April 1, 2010. Management fees of $1,250,000 are paid
quarterly, in
advance, to our Sponsors in exchange for consulting and other services.

Other.Other general and administrative expense increased 7.8%, or $4,217,000, during the year ended April 1, 2010 compared to the
year ended
April 2, 2009 due primarily to increases in annual incentive compensation of approximately $12,000,000 based on improved operating performance and increases in net periodic pension expense of
$4,654,000, partially offset by decreases in cash severance payments of $7,014,000 to our former Chief Executive Officer made in the prior year and a decrease in expense related to a union-sponsored
pension plan of $3,879,000. During the year ended April 2, 2009,

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we
recorded $5,279,000 of expense related to our partial withdrawal liability for a union-sponsored pension plan. During the year ended April 1, 2010, we recorded $1,400,000 of expense related
to our estimated complete withdrawal from the union-sponsored pension plan.

Depreciation and Amortization.Depreciation and amortization decreased 6.5%, or $13,071,000, compared to the prior year due primarily to
the
impairment of long-lived assets in fiscal 2009.

Impairment of Long-Lived Assets.During the year ended April 1, 2010, we recognized non-cash impairment losses of
$3,765,000 related to theatre fixed assets and real estate recorded in other long-term assets. We recognized an impairment loss of $2,330,000 on five theatres with 41 screens (in Florida,
California, New York, Utah and Maryland). Of the theatre charge, $2,330,000 was related to property, net. We also adjusted the carrying value of undeveloped real estate assets based on a recent
appraisal which resulted in an impairment charge of $1,435,000. During the year ended April 2, 2009, we recognized non-cash impairment losses of $73,547,000 related to theatre fixed
assets, internal use software and assets held for sale. We recognized an impairment loss of $65,636,000 on 34 theatres with 520 screens (in Arizona, California, Canada, Florida, Georgia, Illinois,
Maryland, Massachusetts, Michigan, New York, North Carolina, Ohio, Texas, Virginia, Washington and Wisconsin). Of the theatre charge, $1,365,000 was related to intangible assets, net, and $64,271,000
was related to property, net. We recognized an impairment loss on abandonment of internal use software, recorded in other long-term assets of $7,125,000 when management determined that the
carrying value would not be realized through future use. We adjusted the carrying value of our assets held for sale to reflect the subsequent sales proceeds received in January 2009 and declines in
fair value, which resulted in impairment charges of $786,000.

Other (Income) Expense.Other (income) expense includes $(13,591,000) and $(14,139,000) of income related to the derecognition of gift
card
liabilities, as to which we believe future redemption to be remote, during the year ended April 1, 2010 and April 2, 2009, respectively. Other (income) expense
includes a loss on extinguishment of indebtedness of $11,276,000 related to the Cash Tender Offer during the year ended April 1, 2010.

Interest Expense.Interest expense increased 6.9%, or $10,425,000, primarily due to an increase in interest expense related to the
issuance of the
Notes due 2019, partially offset by a decrease in interest rates on the senior secured credit facility and extinguishment of debt from the Cash Tender Offer.

Equity in Earnings of Non-Consolidated Entities.Equity in earnings of non-consolidated entities was $30,300,000 in the
current year compared to $24,823,000 in the prior year. Equity in earnings related to our investment in National CineMedia, LLC were $34,436,000 and $27,654,000 for the year ended
April 1, 2010 and April 2, 2009, respectively. We recognized an impairment loss of $2,742,000 related to an equity method investment in one U.S. motion picture theatre during the year
ended April 2, 2009.

Investment Income.Investment income was $240,000 for the year ended April 1, 2010 compared to $1,731,000 for the year ended
April 2,
2009. The year ended April 2, 2009 includes a gain of $2,383,000 from the May 2008 sale of our investment in Fandango, which was the result of receiving the final distribution from the general
claims escrow account. During the year ended April 2, 2009, we recognized an impairment loss of $1,512,000 related to unrealized losses previously recorded in accumulated other comprehensive
income on marketable securities related to one of our deferred compensation plans when we determined the decline in fair value below historical cost to be other than temporary.

Income Tax Provision (Benefit).The income tax provision (benefit) from continuing operations was a benefit of ($68,800,000) for the
year ended
April 1, 2010 and a provision of $5,800,000 for the year ended April 2, 2009. Our income tax benefit in fiscal 2010 includes the release of $62,218,000 of valuation allowance for
deferred tax assets. See Note 9Income Taxes to the Consolidated Financial

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Statements
included elsewhere in this Annual Report on Form 10-K for our effective income tax rate reconciliation.

Earnings (Loss) from Discontinued Operations, Net.On December 29, 2008, we sold our operations in Mexico, including 44 theatres
and 493
screens. The results of operations of the Cinemex theatres have been classified as discontinued operations for all years presented and includes bad debt expense related to amounts due from Cinemex of
$8,861,000 for the year ended April 1, 2010. See Note 2Discontinued Operations to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K
for the components of the earnings from discontinued operations.

Net Earnings (Loss).Net earnings (loss) were $39,654,000 and $(111,158,000) for the year ended April 1, 2010 and April 2,
2009,
respectively. Net earnings were favorably impacted by a $62,218,000 reduction in the valuation allowance for deferred income tax assets. Net earnings during the year ended April 1, 2010 were
negatively impacted by an expense of $11,276,000 related to the Cash Tender Offer and by losses of $8,861,000 related to the allowance for doubtful accounts and direct write-offs of
amounts due from Cinemex included in discontinued operations. Net loss for the year ended April 2, 2009 was primarily due to impairment charges of $73,547,000.

For the Year Ended April 2, 2009 and April 3, 2008

Revenues.Total revenues decreased 2.9%, or $67,557,000, during the year ended April 2, 2009 compared to the year ended
April 3, 2008.
Fiscal year 2009 includes 52 weeks and fiscal year 2008 includes 53 weeks which we estimate contributed approximately $30,000,000 to the decline in our total revenues. Admissions
revenues decreased 2.2%, or $35,278,000, during the year ended April 2, 2009 compared to the year ended April 3, 2008, due to a 5.5% decrease in attendance partially offset by a 3.6%
increase in average ticket price. The increase in average ticket price was primarily due to our practice of periodically reviewing ticket prices and making selective adjustments based upon such
factors as general inflationary trends and conditions in local markets. Admissions revenues at comparable theatres (theatres opened on or before the first quarter of fiscal 2008) decreased 4.1%, or
$63,821,000, during the year ended April 2, 2009 from the comparable period last year. Based upon available industry sources, box office revenues of our comparable theatres slightly
underperformed the overall industry comparable theatres in the markets where we operate. We believe our underperformance is primarily the result of changes in distribution patterns and an increase in
the number of prints released in our markets. While our box office performance on such films was in line with our expectations, the increase in prints in our market diluted our overall performance
against the industry. Concessions revenues decreased 3.4%, or $22,079,000, during the year ended April 2, 2009 compared to the year ended April 3, 2008 due to the decrease in attendance
partially offset by a 2.2% increase in average concessions per patron. Other theatre revenues decreased 14.8%, or $10,200,000, during the year ended April 2, 2009 compared to year ended
April 3, 2008, primarily due to a decrease in advertising revenues.
See Note 1The Company and Significant Accounting Policies, Revenues to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for discussion of
the change in estimate for revenues recorded during the years ended April 2, 2009 and April 3, 2008.

Costs and expenses.Total costs and expenses increased 2.1%, or $46,059,000, during the year ended April 2, 2009 compared to the
year ended
April 3, 2008. Film exhibition costs decreased 2.0%, or $17,585,000, during the year ended April 2, 2009 compared to the year ended April 3, 2008 due to the decrease in admissions
revenues partially offset by an increase in film exhibition costs as a percentage of admission revenues. As a percentage of admissions revenues, film exhibition costs were 53.3% in the current year as
compared with 53.2% in the prior year. Concession costs decreased 2.6%, or $1,818,000, during the year ended April 2, 2009 compared to the year ended April 3, 2008 due to the decrease in
concession revenues partially offset by an increase in concession costs as a percentage of concessions revenues. As a percentage of concessions revenues, concession costs were 10.8% in the

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current
year and 10.7% in the prior year. As a percentage of revenues, operating expense was 25.4% in the current year and 24.5% in the prior year. Operating expense in the current and prior year
includes $2,262,000 and $20,970,000 of theatre and other closure income, respectively, due primarily to lease terminations negotiated on favorable terms. Rent expense increased 2.1%, or $9,414,000,
during the year ended April 2, 2009 compared to the year ended April 3, 2008 due primarily to the opening of new theatres. Preopening expense decreased $1,709,000 during the year ended
April 2, 2009 due to a decline in screen additions.

General and Administrative Expense:

Merger, acquisition and transaction costs.Merger, acquisition and transaction costs decreased $5,720,000 during the year ended
April 2, 2009
compared to the year ended April 3, 2008. Prior year costs are primarily comprised of professional and consulting expenses related to a proposed initial public offering of common stock that was
withdrawn on June 19, 2007 and preacquisition expenses for casualty insurance losses that occurred prior to the merger with Loews.

Management fees.Management fees were unchanged during the year ended April 2, 2009. Management fees of $1,250,000 are paid
quarterly, in
advance, to our Sponsors in exchange for consulting and other services.

Other.Other general and administrative expense increased 37.2%, or $14,570,000, during the year ended April 2, 2009 compared to
the year
ended April 3, 2008. The increase in other general and administrative expenses is primarily due to a cash severance payment of $7,014,000 to our former Chief Executive Officer and an expense of
$5,279,000 related to our partial withdrawal liability for a union-sponsored pension plan, partially offset by a pension curtailment gain of $1,072,000 as a result of the retirement of our former
chief executive officer.

Depreciation and Amortization.Depreciation and amortization decreased 9.3%, or $20,698,000, compared to the prior year due primarily
to certain
intangible assets becoming fully amortized, the closing of theatres and impairment of long-lived assets.

Impairment of Long-Lived Assets.During fiscal 2009 we recognized non-cash impairment losses of $73,547,000 related to
theatre fixed assets, internal use software and assets held for sale. We recognized an impairment loss of $65,636,000 on 34 theatres with 520 screens (in Arizona, California, Canada, Florida, Georgia,
Illinois, Maryland, Massachusetts, Michigan, New York, North Carolina, Ohio, Texas, Virginia, Washington and Wisconsin). Of the theatre charge, $1,365,000 was related to intangible assets, net, and
$64,271,000 was related to property, net. We recognized an impairment loss on abandonment of internal use software, recorded in other long-term assets of $7,125,000 when management
determined that the carrying value would not be realized through future use, we adjusted the carrying value of our assets held for sale to reflect the sales proceeds received in fiscal 2009 and
declines in fair value, which resulted in impairment charges of $786,000. During fiscal 2008 we recognized a non-cash impairment loss of $8,933,000 that reduced property, net on 17
theatres with 176 screens (in New York, Maryland, Indiana, Illinois, Nebraska, Oklahoma, California, Arkansas, Pennsylvania, Washington, and the District of Columbia).

Other Income.Other income includes $14,139,000 and $11,289,000 of income related to the derecognition of gift card liabilities, as to
which we
believe future redemption to be remote, during the year ended April 2, 2009 and April 3, 2008, respectively. Other income includes insurance recoveries related to Hurricane Katrina of
$1,246,000 for property losses in excess of property carrying cost and $397,000 for business interruption during the year ended April 3, 2008.

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Interest Expense.Interest expense decreased 9.4%, or $15,760,000, primarily due to decreased interest rates on the senior secured
credit facility.

Equity in Earnings of Non-Consolidated Entities.Equity in earnings of non-consolidated entities was $24,823,000 in the
current year compared to $43,019,000 in the prior year. Equity in earnings related to our investment in National CineMedia, LLC were $27,654,000 and $22,175,000 for the year ended
April 2, 2009 and April 3, 2008, respectively. Equity in earnings related to HGCSA was $18,743,000 during the year ended April 3, 2008 and includes the gain related to the
disposition of $18,751,000. We recognized an impairment loss of $2,742,000 related to an equity method investment in one U.S. motion picture theatre during the year ended April 2, 2009.

Investment Income.Investment income was $1,731,000 for the year ended April 2, 2009 compared to $23,923,000 for the year ended
April 3, 2008. The year ended April 2, 2009 and April 3, 2008 include a gain on the sale of our investment in Fandango of $2,383,000 and $15,977,000, respectively. Interest income
decreased $6,672,000 from the prior year primarily due to decreases in temporary investments and decreases in rates of interest earned on temporary investments. During the year ended April 2,
2009, we recognized an impairment loss of $1,512,000 related to unrealized losses previously recorded in accumulated other comprehensive income on marketable securities related to one of our deferred
compensation plans when we determined the decline in fair value below historical cost to be other than temporary.

Income Tax Provision.The provision for income taxes from continuing operations was $5,800,000 for the year ended April 2, 2009
and $1,020,000
for the year ended April 3, 2008 with the reduction due primarily to the decrease in earnings from continuing operations before income taxes. See Note 9Income Taxes to the
Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.

Earnings from Discontinued Operations, Net.On December 29, 2008, we sold our operations in Mexico, including 44 theatres and 493
screens. The
results of operations of the Cinemex theatres have been classified as discontinued operations, and information presented for all years reflects the new classification. See
Note 2Discontinued Operations to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for the components of the earnings from discontinued
operations.

Net Earnings (Loss).Net earnings (loss) were $(111,158,000) and $22,733,000 for the year ended April 2, 2009 and April 3,
2008,
respectively. The decrease in net earnings was primarily due to impairment charges of $73,547,000 in the current year and the recognition of a gain on disposition of HGCSA of $18,751,000, a gain on
the disposition of Fandango of $15,977,000 and theatre and other closure income of $20,970,000 which were recorded in the prior year.

Liquidity and Capital Resources

Our consolidated revenues are primarily collected in cash, principally through box office admissions and theatre concessions sales. We
have an operating "float" which partially finances our operations and which generally permits us to maintain a smaller amount of working capital capacity. This float exists because admissions revenues
are received in cash, while exhibition costs (primarily film rentals) are ordinarily paid to distributors from 20 to 45 days following receipt of box office admissions revenues. Film
distributors generally release the films which they anticipate will be the most successful during the summer and holiday seasons. Consequently, we typically generate higher revenues during such
periods.

We
have the ability to borrow against our senior secured credit facility to meet obligations as they come due (subject to limitations on the incurrence of indebtedness in our various
debt instruments) and had approximately $187,168,000 under our senior secured revolving credit facility available to meet

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these
obligations as of April 1, 2010. Reference is made to Note 7Corporate Borrowings and Capital and Financing Lease Obligations to the Consolidated Financial Statements
included elsewhere in this Annual Report on Form 10-K for information about our outstanding indebtedness and outstanding indebtedness of Holdings and Parent.

We
fund the costs of constructing, maintaining and remodeling new theatres through existing cash balances, cash generated from operations or borrowed funds, as necessary. We generally
lease our theatres pursuant to long-term non-cancelable operating leases which may require the developer, who owns the property, to reimburse us for the construction costs. We
may decide to own the real estate assets of new theatres and, following construction, sell and leaseback the real estate assets pursuant to long-term non-cancelable operating
leases.

We
believe that cash generated from operations and existing cash and equivalents will be sufficient to fund operations and planned capital expenditures and acquisitions currently and for
at least the next 12 months and enable us to maintain compliance with covenants related to the senior secured credit facility and our 8% Senior Subordinated Notes due 2014 (the "Notes due
2014"), 11% Senior Subordinated Notes due 2016 (the "Notes due 2016"), Notes due 2019, and 12% Discount Notes due 2014. We are considering various options with respect to the utilization of cash and
equivalents on hand in excess of our anticipated operating needs. Such options might include, but are not limited to, acquisitions of theatres or theatre companies, repayment of corporate borrowings
of AMCE, Holdings and Parent and payment of dividends.

Holding Company Status

Marquee Holdings Inc. is a holding company with no operations of its own and has no ability to service interest or principal on
its indebtedness or pay dividends other than through any dividends it may receive from its subsidiaries. Under certain circumstances, AMC Entertainment is restricted from paying dividends to Holdings
by the terms of the indentures relating to its notes and its senior secured credit facility. AMC Entertainment's senior secured credit facility and note indentures contain provisions which limit the
amount of dividends and advances which it may pay or make to Holdings. Under the most restrictive of these provisions, set forth in the note indenture for the 11% Senior Subordinated notes due 2016,
(the "Notes due 2016") the amount of loans and dividends which AMC Entertainment could make to Holdings may not exceed approximately $309,752,000 in the aggregate as of April 1, 2010. Under the
note indentures, a loan to Holdings would
have to be on terms no less favorable to AMC Entertainment than could be obtained in a comparable transaction on an arm's length basis with an unaffiliated third party and be in the best interest of
AMC Entertainment. Provided no event of default has occurred or would result, the senior secured credit facility also permits AMC Entertainment to pay cash dividends to Holdings for specified
purposes, including indemnification claims, taxes, up to $4,000,000 annually for operating expenses, repurchases of equity awards to satisfy tax withholding obligations, specified management fees,
fees and expenses of permitted equity and debt offerings and to pay for the repurchase of stock from employees, directors and consultants under benefit plans up to specified amounts. Depending on the
net senior secured leverage ratio, as defined in the senior secured credit facility, AMC Entertainment may also pay Holdings a portion of net cash proceeds from specified assets sales.

Cash Flows from Operating Activities

Cash flows provided by operating activities, as reflected in the Consolidated Statements of Cash Flows, were $228,951,000, $168,096,000
and $201,676,000 during the years ended April 1, 2010, April 2, 2009 and April 3, 2008 respectively. The increase in operating cash flows during the year ended April 1,
2010 is primarily due to an increase in accrued expenses and other liabilities as a result of increases in accrued interest and annual incentive compensation and the increase in attendance. The
decrease in operating cash flows during the year ended April 2, 2009 is primarily due to the decrease in net

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earnings
which was partially offset by an increase in non-cash impairment charges. We had working capital surplus as of April 1, 2010 and April 2, 2009 of $141,685,000 and
$257,714,000, respectively. Working capital includes $125,842,000 and $121,628,000 of deferred revenue as of April 1, 2010 and April 2, 2009, respectively.

Cash Flows from Investing Activities

Cash provided by (used in) investing activities, as reflected in the Consolidated Statement of Cash Flows were $(96,337,000),
$100,925,000 and $(139,405,000) during the years ended April 1, 2010, April 2, 2009 and April 3, 2008, respectively. On March 26, 2010, we acquired 117 digital projection
systems from third party lessors for $6,784,000 and sold these systems together with seven digital projectors that we owned to DCIP for cash proceeds of $6,570,000 on the same day. Cash outflows from
investing activities include capital expenditures of $97,011,000 during the year ended April 1, 2010. We expect that our gross capital expenditures in fiscal 2011 will be approximately
$120,000,000 to $150,000,000.

Cash
flows for the year ended April 2, 2009 include proceeds from the sale of Cinemex of $224,378,000 and proceeds from the sale of Fandango of $2,383,000. We have received an
additional $4,315,000 of purchase price from Cinemex related to tax payments and refunds and a working capital calculation and post closing adjustments during the year ended April 1, 2010. Cash
flows for the year ended April 3, 2008 include proceeds from the disposal of HGCSA and Fandango of $28,682,000 and $17,977,000, respectively.

Cash Flows from Financing Activities

Cash flows provided by (used in) financing activities, as reflected in the Consolidated Statement of Cash Flows, were $(170,034,000),
$161,843,000 and $(270,690,000) during the years ended April 1, 2010, April 2, 2009 and April 3, 2008, respectively.

During
fiscal 2010, AMCE used cash on hand to pay two dividend distributions to Holdings in an aggregate amount of $329,981,000, and Holdings made two dividend payments to its
stockholder, Parent, totaling $300,881,000, which were treated as reductions of additional paid-in capital. Holdings used the available funds to make cash interest payments on its 12%
Senior Discount Notes due 2014, to pay corporate overhead expenses incurred in the ordinary course of business and to pay a dividend to Parent. Parent made payments to purchase term loans and reduced
the principal balance of its Parent Term Loan Facility from $466,936,000 to $193,290,000 with a portion of the dividend proceeds. During fiscal 2009, we paid two cash dividends totaling $3,349,000 to
Parent and borrowed $185,000,000 under AMCE's senior secured credit facility. During fiscal 2008, AMCE made principal payments of $26,295,000 on its corporate borrowings, capital and financing lease
obligation, and mortgage obligations. AMCE also paid two cash dividends to Holdings totaling $293,551,000, and Holdings paid cash dividends to Parent totaling $270,588,000.

On
June 9, 2009, we issued $600,000,000 aggregate principal amount of 8.75% Senior Notes due 2019. Proceeds from the issuance of the notes were $585,492,000, and deferred
financing costs paid related to the issuance of the notes were $16,259,000 during the fiscal year ended April 1, 2010.

During
the fiscal year ended April 1, 2010, we made principal payments of $250,000,000 in connection with a cash tender offer and redemption of all of our then outstanding
85/8% Senior Notes due 2012, and we repaid $185,000,000 of revolving credit borrowings under our senior secured credit facility.

43

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Table of Contents

Commitments and Contingencies

Minimum annual cash payments required under existing capital and financing lease obligations, maturities of corporate borrowings,
future minimum rental payments under existing operating leases, FF&E and leasehold purchase provisions, entry into a definitive agreement for the acquisition of Kerasotes, ADA related betterments and
pension funding that have initial or remaining non-cancelable terms in excess of one year as of April 1, 2010 are as follows:

(In thousands)

Minimum
Capital and
Financing
Lease
Payments

Principal
Amount of
Corporate
Borrowings(1)

Interest
Payments on
Corporate
Borrowings(2)

Minimum
Operating
Lease
Payments

Acquisitions
and Capital
Related
Betterments(3)

Pension
Funding(4)

Total
Commitments2011

$
9,225

$
6,500

$
153,521

$
390,558

$
293,234

$
5,753

$
858,7912012


8,023


6,500


153,391


392,317


10,323


976


571,5302013


7,055


609,375


151,250


380,224








1,147,9042014


6,706


300,000


139,145


353,535








799,3862015


6,728


240,795


99,086


350,352








696,961Thereafter


61,900


925,000


252,917


2,016,646








3,256,463Total

$
99,637

$
2,088,170

$
949,310

$
3,883,632

$
303,557

$
6,729

$
7,331,035


(1)Represents
cash requirements for the payment of principal on corporate borrowings. Total amount does not equal carrying amount due to unamortized discounts
on issuance.(2)Interest
expense on the term loan portion of our senior secured credit facility was estimated at 2.00% based upon the interest rate in effect as of
April 1, 2010.(3)Includes
committed capital expenditures and acquisitions including the estimated cost of ADA related betterments. Does not include planned, but
non-committed capital expenditures. Our cash outlays for the acquisition of Kerasotes are anticipated to be $275,000,000, subject to working capital and other purchase price adjustments.(4)Historically
we fund our pension plan such that the plan is 90% funded. The plan has been frozen effective December 31, 2006. The funding requirement
has been estimated based upon our expected funding amount. Also included are payments due under a withdrawal liability for a union sponsored plan. The retiree health plan is not funded.


As
discussed in Note 9Income Taxes to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K, we adopted accounting for
uncertainty in income taxes per the guidance in ASC 740. At April 1, 2010, our company has recognized an obligation for unrecognized benefits of $34,500,000. There are currently unrecognized
tax benefits which we anticipate will be resolved in the next 12 months; however, we are unable at this time to estimate what the impact
on our effective tax rate will be. Any amounts related to these items are not included in the table above.

Fee Agreement

In connection with the holdco merger, on June 11, 2007, Parent, Holdings, AMCE and the Sponsors entered into a Fee Agreement
(the "Management Fee Agreement"), which replaced the December 23, 2004 fee agreement among Holdings, AMCE and the Sponsors, as amended and restated on January 26, 2006 (the "original fee
agreement"). The Management Fee Agreement provides for an annual management fee of $5,000,000, payable quarterly and in advance to our Sponsors, on a pro rata basis, until the twelfth anniversary from
December 23, 2004, as well as reimbursements for each

44

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Table of Contents

Sponsor's
respective out-of-pocket expenses in connection with the management services provided under the Management Fee Agreement.

In
addition, the Management Fee Agreement provides for reimbursements by AMCE to the Sponsors for their out-of-pocket expenses, and by AMCE to Parent of up to
$3,500,000 for fees payable by Parent in any single fiscal year in order to maintain Parents' and AMCE's corporate existence, corporate overhead expenses and salaries or other compensation of certain
employees.

Upon
the consummation of a change in control transaction or an IPO, the Sponsors will receive, in lieu of quarterly payments of the annual management fee, an automatic fee equal to the
net present value of the aggregate annual management fee that would have been payable to the Sponsors during the remainder of the term of the fee agreement (assuming a twelve year term from the date
of the original fee agreement), calculated using the treasury rate having a final maturity date that is closest to the twelfth anniversary of the date of the original fee agreement date. As of
April 1, 2010, we estimate this amount would be $29,190,000 should a change in control transaction or an IPO occur.

The
Management Fee Agreement also provides that AMCE will indemnify the Sponsors against all losses, claims, damages and liabilities arising in connection with the management services
provided by the Sponsors under the fee agreement.

Investment in NCM

As discussed in Cash Flows From Investing Activities, we hold an investment in 18.23% of NCM accounted for following the equity method.
The fair market value of these shares is approximately $334,629,000 as of April 1, 2010. Because we have little tax basis in these units and because the sale of all these units would require us
to report taxable income of $468,686,000 including distributions received from NCM that were previously deferred, we expect that any sales of these units would be made ratably over a period of time to
most efficiently manage any related tax liability. We have available net operating loss carryforwards which could reduce any related tax liability.

Impact of Inflation

Historically, the principal impact of inflation and changing prices upon us has been to increase the costs of the construction of new
theatres, the purchase of theatre equipment, rent and the utility and labor costs incurred in connection with continuing theatre operations. Film exhibition costs, our largest cost of operations, are
customarily paid as a percentage of admissions revenues and hence, while the film exhibition costs may increase on an absolute basis, the percentage of admissions revenues represented by such expense
is not directly affected by inflation. Except as set forth above, inflation and changing prices have not had a significant impact on our total revenues and results of operations.

New Accounting Pronouncements

See Note 1The Company and Significant Accounting Policies to the Consolidated Financial Statements included
elsewhere in this Annual Report on Form 10-K for further information regarding recently issued accounting standards.

Item 7A.    Quantitative and Qualitative Disclosures about Market Risk

We are exposed to various market risks including interest rate risk and foreign currency exchange rate risk.

Market risk on variable-rate financial instruments.We maintain an $850,000,000 senior secured credit facility, comprised of a
$200,000,000 revolving credit facility and a $650,000,000 term loan facility, which permits borrowings at a rate equal to an applicable margin plus, at our option, either a base rate or LIBOR.
Increases in market interest rates would cause interest expense to increase and earnings

45

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Table of Contents

before
income taxes to decrease. The change in interest expense and earnings before income taxes would be dependent upon the weighted average outstanding borrowings during the reporting period
following an increase in market interest rates. We had no borrowings on our revolving credit facility as of April 1, 2010 and had $622,375,000 outstanding under the term loan facility on
April 1, 2010. A 100 basis point change in market interest rates would have increased or decreased interest expense on the senior secured credit facility by $6,549,000 during the
fifty-two weeks ended April 1, 2010.

Market risk on fixed-rate financial instruments.Included in long-term debt are $325,000,000 of our Notes due 2016,
$300,000,000 of our Notes due 2014, $600,000,000 of our Notes due 2019, and $240,795,000 of our Discount Notes due 2014. Increases in market interest rates would generally cause a decrease in the fair
value of the Notes due 2016, Notes due 2014, Notes due 2019, and Discount Notes due 2014 and a decrease in market interest rates would generally cause an increase in fair value of the Notes due 2016,
Notes due 2014, Notes due 2019, and Discount Notes due 2014.

Foreign currency exchange rates.We currently operate theatres in Canada, France and the United Kingdom. As a result of these
operations, we have
assets, liabilities, revenues and expenses denominated in foreign currencies. The strengthening of the U.S. dollar against the respective currencies causes a decrease in the carrying values of assets,
liabilities, revenues and expenses denominated in such foreign currencies and the weakening of the U.S. dollar against the respective currencies causes an increase in the carrying values of these
items. The increases and decreases in assets, liabilities, revenues and expenses are included in accumulated other comprehensive income. Changes in foreign currency exchange rates also impact the
comparability of earnings in these countries on a year-to-year basis. As the U.S. dollar strengthens, comparative translated earnings decrease, and as the U.S. dollar weakens
comparative translated earnings from foreign operations increase. A 10% increase in the value of the U.S. dollar against all foreign currencies of countries where we currently operate theatres would
decrease losses before income taxes by approximately $722,000 and decrease accumulated other comprehensive loss by approximately
$8,345,000, respectively, as of April 1, 2010. A 10% decrease in the value of the U.S. dollar against all foreign currencies of countries where we currently operate theatres would increase
losses before income taxes by approximately $883,000 and increase accumulated other comprehensive loss by approximately $10,199,000, respectively, as of April 1, 2010.

46

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Item 8.    Financial Statements and Supplementary Data

MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Marquee Holdings Inc.

TO THE STOCKHOLDER OF MARQUEE HOLDINGS INC.

Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company as
defined in Rule 12a-15(f) of the Exchange Act. With our participation, an evaluation of the effectiveness of internal control over financial reporting was conducted as of
April 1, 2010, based on the framework and criteria established inInternal ControlIntegrated Frameworkissued by the Committee of
Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management has concluded that our internal control over financial reporting was effective as of April 1, 2010.
This annual report does not include an attestation report of the Company's independent registered public accounting firm regarding internal control over financial reporting. Management's report was
not subject to attestation by the Company's independent registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only
management's report in this annual report.

GRAPHIC

Chief Executive Officer
and President

GRAPHIC

Executive Vice President and
Chief Financial Officer

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Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The
Board of Directors and Stockholder
Marquee Holdings Inc.:

We
have audited the accompanying consolidated balance sheet of Marquee Holdings Inc. (and subsidiaries) as of April 1, 2010, and the related consolidated statements of
operations, stockholder's equity, and cash flows for the year then ended. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audit.

We
conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.

In
our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Marquee Holdings Inc. (and
subsidiaries) as of April 1, 2010, and the results of their operations and their cash flows for the year then ended in conformity with U.S. generally accepted accounting principles.

As
discussed in Note 1 to the consolidated financial statements, the Company changed its accounting treatment for business combinations due to the adoption of new accounting
requirements issued by the FASB, as of April 3, 2009.

/s/ KPMG LLPKansas City, Missouri
June 14, 2010


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Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS AND STOCKHOLDER OF MARQUEE HOLDINGS INC.:

In our opinion, the accompanying consolidated balance sheet and the related consolidated statements of operations, of stockholder's
equity and of cash flows present fairly, in all material respects, the financial position of Marquee Holdings Inc. and its subsidiaries (the "Company") at April 2, 2009, and the results of
their operations and their cash flows for the 52 week period ended April 2, 2009 and the 53 week period ended April 3, 2008, in conformity with accounting principles
generally accepted in the United States of America. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As
discussed in Note 9, the Company changed the manner in which it accounts for uncertain tax positions in fiscal 2008.

/s/
PricewaterhouseCoopers LLP

Kansas
City, Missouri
May 26, 2009

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Marquee Holdings Inc.        CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

53 Weeks
Ended
April 3, 2008RevenuesAdmissions

$
1,711,853

$
1,580,328

$
1,615,606Concessions


646,716


626,251


648,330Other theatre


59,170


58,908


69,108Total revenues


2,417,739


2,265,487


2,333,044Costs and ExpensesFilm exhibition costs


928,632


842,656


860,241Concession costs


72,854


67,779


69,597Operating expense


610,774


576,022


572,740Rent


440,664


448,803


439,389General and administrative:Merger, acquisition and transaction costs


2,383


652


6,372Management fee


5,000


5,000


5,000Other


57,964


53,747


39,177Depreciation and amortization


188,342


201,413


222,111Impairment of long-lived assets


3,765


73,547


8,933Total costs and expenses


2,310,378


2,269,619


2,223,560Other expense (income)Other income


(2,559
)

(14,139
)

(12,932
)Interest expenseCorporate borrowings


156,420


145,657


160,902Capital and financing lease obligations


5,652


5,990


6,505Equity in earnings of non-consolidated entities


(30,300
)

(24,823
)

(43,019
)Investment income


(240
)

(1,731
)

(23,923
)Total other expense


128,973


110,954


87,533Earnings (loss) from continuing operations before income taxes


(21,612
)

(115,086
)

21,951Income tax provision (benefit)


(68,800
)

5,800


1,020Earnings (loss) from continuing operations


47,188


(120,886
)

20,931Earnings (loss) from discontinued operations, net of income taxes


(7,534
)

9,728


1,802Net earnings (loss)

$
39,654

$
(111,158
)
$
22,733


See
Notes to Consolidated Financial Statements.

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Marquee Holdings Inc.        CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

April 1,
2010

April 2,
2009AssetsCurrent assets:Cash and equivalents

$
497,948

$
536,580Receivables, net of allowance for doubtful accounts of $2,103 and $1,564


25,539


29,782Other current assets


72,919


80,526Total current assets


596,406


646,888Property, net


863,532


964,668Intangible assets, net


148,432


162,366Goodwill


1,836,731


1,836,731Other long-term assets


238,103


146,088Total assets

$
3,683,204

$
3,756,741Liabilities and Stockholder's EquityCurrent liabilities:Accounts payable

$
175,142

$
155,553Accrued expenses and other liabilities


143,274


102,070Deferred revenues and income


125,842


121,628Current maturities of corporate borrowings and capital and financing lease obligations


10,463


9,923Total current liabilities


454,721


389,174Corporate borrowings


2,067,149


1,922,236Capital and financing lease obligations


53,323


57,286Deferred revenues for exhibitor services agreement


252,322


253,164Other long-term liabilities


309,591


308,703Total liabilities


3,137,106


2,930,563Commitments and contingenciesStockholder's equity:Common Stock, 1 share issued with 1¢ par value





Additional paid-in capital


747,206


1,046,703Accumulated other comprehensive income (loss)


(3,176
)

17,061Accumulated deficit


(197,932
)

(237,586
)Total stockholder's equity


546,098


826,178Total liabilities and stockholder's equity

$
3,683,204

$
3,756,741


See
Notes to Consolidated Financial Statements.

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Marquee Holdings Inc.        CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

52 Weeks Ended
April 1, 2010

52 Weeks Ended
April 2, 2009

53 Weeks Ended
April 3, 2008Cash flows from operating activities:Net earnings (loss)

$
39,654

$
(111,158
)
$
22,733Adjustments to reconcile net earnings (loss) to cash provided by operating activities:Depreciation and amortization


188,342


222,483


251,194Impairment of long-lived assets


3,765


73,547


8,933Deferred income taxes


(66,500
)

400


(2,800
)Write-off of issuance costs related to early extinguishment of debt


3,468





Loss (gain) on disposition of Cinemex


7,534


(14,772
)

Excess distributions/(Equity in earnings losses from investments, net of distributions)


5,862


6,600


(18,354
)Change in assets and liabilities:Receivables


(2,130
)

9,296


10,128Other assets


2,323


(2,861
)

(40,379
)Accounts payable


13,383


20,423


5,906Accrued expenses and other liabilities


40,524


(24,130
)

(23,166
)Other, net


(7,274
)

(11,732
)

(12,519
)Net cash provided by operating activities


228,951


168,096


201,676Cash flows from investing activities:Capital expenditures


(97,011
)

(121,456
)

(171,100
)Purchase of digital projection equipment for sale/leaseback


(6,784
)




Proceeds from sale/leaseback of digital projection equipment


6,570





Proceeds on disposition of Fandango





2,383


17,977Proceeds on disposition of HGCSA








28,682Proceeds on disposition of Cinemex, net of cash disposed


4,315


224,378


LCE screen integration


(81
)

(4,700
)

(11,201
)Other, net


(3,346
)

320


(3,763
)Net cash provided by (used in) investing activities


(96,337
)

100,925


(139,405
)Cash flows from financing activities:Proceeds from issuance of senior notes due 2019


585,492





Repurchase of senior notes due 2012


(250,000
)




Payments on Term Loan B


(6,500
)

(6,500
)

(8,125
)Principal payments under mortgages and capital and financing lease obligations


(3,423
)

(3,452
)

(6,070
)Deferred financing costs


(16,436
)

(525
)

(4,265
)Change in construction payables


6,714


(9,331
)

13,586Borrowing (repayment) under Revolving credit facility


(185,000
)

185,000


(Repayment of) borrowing under Cinemex credit facility








(12,100
)Dividends paid to Parent


(300,881
)

(3,349
)

(270,588
)Proceeds from financing lease obligations








16,872Net cash provided by (used in) financing activities


(170,034
)

161,843


(270,690
)Effect of exchange rate changes on cash and equivalents


(1,212
)

(3,001
)

(2,397
)Net increase (decrease) in cash and equivalents


(38,632
)

427,863


(210,816
)Cash and equivalents at beginning of year


536,580


108,717


319,533Cash and equivalents at end of year

$
497,948

$
536,580

$
108,717SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:Cash paid (refunded) during the period for:Interest (including amounts capitalized of $14, $415, and $1,114)

$
148,018

$
154,830

$
161,303Income taxes, net


(2,033
)

16,731


17,064Schedule of non-cash investing and financing activities:Assets capitalized under ASC 840-40-05-5

$


$


$
4,600Investment in NCM (See Note 5Investments)


2,290


5,453


21,598Investment in DCIP (See Note 5Investments)


21,768








See Notes to Consolidated Financial Statements.

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Marquee Holdings Inc.

CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY

Class A-1
Voting
Common Stock

Class A-2
Voting
Common Stock

Class N
Nonvoting
Common Stock

Class L-1
Voting
Common Stock

Class L-2
Voting
Common StockCommon Stock



Accumulated
Other
Comprehensive
Income (Loss)Additional
Paid-in Capital

Accumulated
Deficit

Total
Stockholder's
Equity(In thousands, except
share and per share data)

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

Shares

AmountMarch 29, 2007 through April 1, 2010Balance March 29, 2007




$



382,475.00000

$
4


382,475.00000

$
4


5,128.77496

$



256,085.61252

$
3


256,085.61252

$
3

$
1,314,579

$
(3,834
)
$
(143,706
)
$
1,167,053Comprehensive earnings:Net earnings












































22,733


22,733ASC 740 (formerly FIN 48) adoption adjustment












































(5,373
)

(5,373
)Foreign currency translation adjustment









































(1,708
)




(1,708
)Change in fair value of cash flow hedges









































(5,507
)




(5,507
)Losses on interest rate swaps reclassified to interest expense corporate borrowings









































1,523





1,523Pension and other benefit adjustments









































6,532





6,532Unrealized loss on marketable securities









































(674
)




(674
)Comprehensive earnings















































17,526Stock-based compensationoptions






































3,439








3,439Dividends paid to AMC Entertainment Holdings, Inc.






































(270,588
)







(270,588
)Conversion of stock upon creation of AMC Entertainment Holdings, Inc.


1





(382,475.00000
)

(4
)

(382,475.00000
)

(4
)

(5,128.77496
)




(256,085.61252
)

(3
)

(256,085.61252
)

(3
)










(14
)Balance April 3, 2008


1



































1,047,430


(3,668
)

(126,346
)

917,416Comprehensive earnings (loss):Net loss












































(111,158
)

(111,158
)Foreign currency translation adjustment









































25,558





25,558Change in fair value of cash flow hedges









































(1,833
)




(1,833
)Losses on interest rate swaps reclassified to interest expense corporate borrowings









































5,230





5,230Pension and other benefit adjustments









































(8,117
)




(8,117
)Unrealized loss on marketable securities









































(109
)




(109
)Comprehensive loss















































(90,429
)ASC 715 (formerly SFAS 158) adoption adjustment












































(82
)

(82
)Stock-based compensationoptions






































2,622








2,622Dividends paid to AMC Entertainment Holdings, Inc.






































(3,349
)







(3,349
)Balance April 2, 2009


1



































1,046,703


17,061


(237,586
)

826,178


53

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Table of Contents

Marquee Holdings Inc.

CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY (Continued)

Class A-1
Voting
Common Stock

Class A-2
Voting
Common Stock

Class N
Nonvoting
Common Stock

Class L-1
Voting
Common Stock

Class L-2
Voting
Common StockCommon Stock



Accumulated
Other
Comprehensive
Income (Loss)Additional
Paid-in Capital

Accumulated
Deficit

Total
Stockholder's
Equity(In thousands, except
share and per share data)

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

Shares

AmountComprehensive earnings:Net earnings












































39,654


39,654Foreign currency translation adjustment









































(13,021
)




(13,021
)Change in fair value of cash flow hedges









































(6
)




(6
)Losses on interest rate swaps reclassified to interest expense corporate borrowings









































558





558Pension and other benefit adjustments









































(8,499
)




(8,499
)Unrealized gain on marketable securities









































731





731Comprehensive earnings















































19,417Stock-based compensationoptions






































1,384








1,384Dividends paid to AMC Entertainment Holdings, Inc.






































(300,881
)







(300,881
)Balance April 1, 2010


1

$





$





$





$





$





$


$
747,206

$
(3,176
)
$
(197,932
)
$
546,098


See Notes to Consolidated Financial Statements

54

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Table of Contents



Marquee Holdings Inc.        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS        Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES

Marquee Holdings Inc. ("Holdings") is an investment vehicle owned through AMC Entertainment Holdings, Inc. ("Parent") by J.P. Morgan Partners, LLC ("JPMP"), Apollo
Management, L.P. and certain related investment funds ("Apollo") and affiliates of Bain Capital Partners ("Bain"), The Carlyle Group ("Carlyle") and Spectrum Equity Investors ("Spectrum")
(collectively with JPMP and Apollo the "Sponsors"). Holdings was formed for the purpose of acquiring AMC Entertainment Inc. ("AMCE") pursuant to a definitive merger agreement approved by AMCE's
Board of Directors on July 22, 2004. Holdings is a holding company with no operations of its own and it has one direct subsidiary, AMCE.

AMCE,
through its direct and indirect subsidiaries, including American Multi-Cinema, Inc. ("AMC") and its subsidiaries' and AMC Entertainment International, Inc. ("AMCEI")
and its subsidiaries (collectively with Holdings and AMCE, unless the context otherwise requires, the "Company"), is principally involved in the theatrical exhibition business and owns, operates or
has interests in theatres located in the United States and Canada, China (Hong Kong), France and the United Kingdom. The Company discontinued its operations in Spain and Portugal during the third
quarter of fiscal 2007 and discontinued its operations in Mexico during the third quarter of fiscal 2009. The Company's theatrical exhibition business is conducted through AMC and its subsidiaries and
AMCEI.

Use of Estimates:The preparation of financial statements in conformity with generally accepted accounting principles requires
management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Significant estimates and assumptions are used for, but not limited to: (1) Impairments, (2) Goodwill, (3) Income
Taxes, (4) Pension and Postretirement Assumptions and (5) Film Exhibition Costs. Actual results could differ from those estimates.

Principles of Consolidation:The consolidated financial statements include the accounts of Marquee Holdings Inc. and all
subsidiaries, as
discussed above. All significant intercompany balances and transactions have been eliminated in consolidation. There are no noncontrolling (minority) interests in the Company's consolidated
subsidiaries; consequently, all of its stockholder's equity, net earnings (loss) and comprehensive earnings (loss) for the periods presented are attributable to controlling interests.

Fiscal Year:The Company has a 52/53 week fiscal year ending on the Thursday closest to the last day of March. Both fiscal 2010
and fiscal 2009
reflect 52 week periods, while fiscal 2008 reflects a 53 week period.

Revenues:Revenues are recognized when admissions and concessions sales are received at the theatres. The Company defers 100% of
the revenue
associated with the sales of gift cards and packaged tickets until such time as the items are redeemed or management believes future redemption to be remote. During fiscal 2008, management changed its
estimate of when it believes future redemption to be remote for discounted theatre tickets from 24 months from the date of sale to 18 months from the date of sale. During fiscal 2009,
management changed its estimate of redemption rates for packaged tickets. Management believes the 18 month estimate and revised redemption rates are supported by its continued development of
redemption history and that they are reflective of management's current best estimate. These changes in estimate had the effect of increasing other theatre revenues and earnings

55

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

from
continuing operations by approximately $4,200,000 and $2,600,000, respectively, during fiscal 2008 and by approximately $2,600,000 and $1,600,000, respectively, during fiscal 2009. During the
periods ended April 1, 2010, April 2, 2009, and April 3, 2008, the Company recognized $13,591,000, $14,139,000, and $11,289,000 of income, respectively, related to the
derecognition of gift card liabilities where management believes future redemption to be remote which was recorded in other expense (income) in the Consolidated Statements of Operations.

Film Exhibition Costs:Film exhibition costs are accrued based on the applicable box office receipts and estimates of the final
settlement to the
film licenses. Film exhibition costs include certain advertising costs. As of April 1, 2010 and April 2, 2009, the Company recorded film payables of $78,499,000 and $60,286,000,
respectively, which is included in accounts payable in the accompanying consolidated balance sheets.

Concession Costs:The Company records payments from vendors as a reduction of concession costs when earned unless it is
determined that the payment
was for the fair value of services provided to the vendor where the benefit to the vendor is sufficiently separable from the Company's purchase of the vendor's products. In the latter instance,
revenue is recorded when and if the consideration received is in excess of fair value, then the excess is recorded as a reduction of concession costs. In addition, if the payment from the vendor is
for a reimbursement of expenses, then those expenses are offset.

Screen Advertising:On March 29, 2005, the Company and Regal Entertainment Group combined their respective cinema screen
advertising
businesses into a new joint venture company called National CineMedia, LLC ("NCM") and on July 15, 2005, Cinemark Holdings, Inc. ("Cinemark") joined NCM, as one of the founding
members. NCM engages in the marketing and sale of cinema advertising and promotions products; business communications and training services; and the distribution of digital alternative content. The
Company records its share of on-screen advertising revenues generated by NCM in other theatre revenues.

Loyalty Program:The Company records the estimated incremental cost of providing free concession items for awards under its Moviewatcherloyalty program when the awards are earned. Historically, the costs of these awards have not been significant.

Advertising Costs:The Company expenses advertising costs as incurred and does not have any direct-response advertising recorded
as assets.
Advertising costs were $9,103,000, $18,121,000 and $20,677,000 for the periods ended April 1, 2010, April 2, 2009 and April 3, 2008, respectively.

Cash and Equivalents:Under the Company's cash management system, checks issued but not presented to banks frequently result in
book overdraft
balances for accounting purposes and are classified within
accounts payable in the balance sheet. The change in book overdrafts are reported as a component of operating cash flows for accounts payable as they do not represent bank overdrafts. The amount of
these checks included in accounts payable as of April 1, 2010 and April 2, 2009 was $60,943,000 and $55,302,000, respectively. All highly liquid debt instruments and investments
purchased with an original maturity of three months or less are classified as cash equivalents.

56

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

Intangible Assets:Intangible assets are recorded at cost or fair value, in the case of intangible assets resulting from
acquisitions, and are
comprised of lease rights, amounts assigned to theatre leases acquired under favorable terms, customer relationship intangible assets, management contracts and trademarks, each of which are being
amortized on a straight-line basis over the estimated remaining useful lives of the assets except for a customer relationship intangible asset and the AMC Trademark intangible asset
associated with the merger with Marquee. The customer relationship intangible asset is amortized over eight years based upon the pattern in which the economic benefits of the intangible asset are
expected to be consumed or otherwise used up. This pattern indicates that over 2/3rds of the cash flow generated from the asset is derived during the first five years. The AMC Trademark intangible
asset is considered an indefinite lived intangible asset, and therefore is not amortized but rather evaluated for impairment annually. In fiscal 2009, the Company impaired a favorable lease intangible
asset in the amount of $1,364,000.

Investments:The Company accounts for its investments in non-consolidated entities using either the cost or equity methods of
accounting
as appropriate, and has recorded the investments within other long-term assets in its consolidated balance sheets and records equity in earnings and losses of those entities accounted for
following the equity method of accounting within equity in (earnings) losses of non-consolidated entities in its consolidated statements of operations. The Company follows the guidance in
ASC 323-30-35-3, which prescribes the use of the equity method for investments that are not considered to be minor in limited liability companies that maintain
specific ownership accounts. The Company classifies gains and losses on sales of and changes of interest in equity method investments within equity in (earnings) losses of non-consolidated
entities, and classifies gains and losses on sales of investments accounted for using the cost method in investment income. As of April 1, 2010, the Company holds an 18.23% interest in NCM, a
joint venture that markets and sells cinema advertising and promotions; a 26% interest in Movietickets.com, a joint venture that provides moviegoers with a way to buy movie tickets online, access
local showtime information, view trailers and read reviews; a 29.0% interest in Digital Cinema Implementation Partners LLC, a joint venture charged with implementing digital cinema in the
Company's theatres; a 50% interest in three theatres that are accounted for following the equity method of accounting; and a 50% interest in Midland Empire Partners, LLC, a joint venture
developing live and film entertainment venues in the Power & Light District of Kansas City, Missouri. In February 2007, the Company recorded a change of interest gain of $132,622,000 and
received distributions in excess of its investment in NCM
related to the redemption of preferred and common units of $106,188,000. Future equity in earnings from NCM will not be recognized until cumulative earnings exceed the redemption gain or cash
distributions of earnings are received. At April 1, 2010, the Company's recorded investments are less than its proportional ownership of the underlying equity in these entities by approximately
$2,868,000, excluding NCM. These differences will be amortized to equity in earnings or losses over the estimated useful lives of the related assets or evaluated for impairment. Included in equity in
earnings of non-consolidated entities for the fifty-two weeks ended April 2, 2009 is an impairment charge of $2,742,000 related to a theatre joint venture investment.
The decline in the fair market value of the investment was considered other than temporary due to competitive theatre builds.

Goodwill:Goodwill represents the excess of cost over fair value of net tangible and identifiable intangible assets related to
acquisitions. The
Company is not required to amortize goodwill as a charge

57

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

to
earnings; however, the Company is required to conduct an annual review of goodwill for impairment.

The
Company's recorded goodwill was $1,836,731,000 as of both April 1, 2010 and April 2, 2009. The Company evaluates goodwill and its trademark for impairment annually as
of the beginning of the fourth fiscal quarter or more frequently as specific events or circumstances dictate. The Company's goodwill is recorded in its Theatrical Exhibition operating segment which is
also the reporting unit for purposes of evaluating recorded goodwill for impairment. If the carrying value of the reporting unit exceeds its fair value the Company is required to reallocate the fair
value of the reporting unit as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. The Company
determines fair value by using an enterprise valuation methodology determined by applying multiples to cash flow estimates less net indebtedness, which the Company believes is an appropriate method to
determine fair value. There is considerable management judgment with respect to cash flow estimates and appropriate multiples and discount rates to be used in determining fair value and such
management estimates fall under Level 3 within the fair value measurement hierarchy, see Note 14Fair Value Measurements.

The
Company performed its annual impairment analysis during the fourth quarter of fiscal 2010. The fair value of the Company's Theatrical Exhibition operations exceed the carrying value
by more than 10% and management does not believe that impairment is probable.

Other Long-term Assets:Other long-term assets are comprised principally of investments in partnerships and joint ventures,
costs incurred in connection with the issuance of debt
securities, which are being amortized to interest expense over the respective lives of the issuances, and capitalized computer software, which is amortized over the estimated useful life of the
software.

Leases:The majority of the Company's operations are conducted in premises occupied under lease agreements with initial base
terms ranging generally
from 15 to 20 years, with certain leases containing options to extend the leases for up to an additional 20 years. The Company does not believe that exercise of the renewal options are
reasonably assured at the inception of the lease agreements and, therefore, considers the initial base term as the lease term. Lease terms vary but generally the leases provide for fixed and
escalating rentals, contingent escalating rentals based on the Consumer Price Index not to exceed certain specified amounts and contingent rentals based on revenues with a guaranteed minimum.

The
Company's lease terms commence at the time it obtains "control and access" to the leased premises which is generally a date prior to the "lease commencement date" contained in the
lease agreements.

The
Company records rent expense for its operating leases on a straight-line basis over the base term of the lease agreements commencing with the date the Company has
"control and access" to the leased premises, which is generally a date prior to the "lease commencement date" in the lease agreement. Rent expense related to any "rent holiday" is recorded as
operating expense, until construction of the leased premises is complete and the premises are ready for their intended use. Rent charges upon completion of the leased premises subsequent to the
theatre opening date are expensed as a component of rent expense.

58

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

Occasionally,
the Company will receive amounts from developers in excess of the costs incurred related to the construction of the leased premises. The Company records the excess amounts
received from developers as deferred rent and amortizes the balance as a reduction to rent expense over the base term of the lease agreement.

The
Company evaluates the classification of its leases following the guidance in ASC 540-10-25. Leases that qualify as capital leases are recorded at the present
value of the future minimum rentals over the base term of the lease using the Company's incremental borrowing rate. Capital lease assets are assigned an estimated useful life at the inception of the
lease that generally correspond with the base term of the lease.

Occasionally,
the Company is responsible for the construction of leased theatres and for paying project costs that are in excess of an agreed upon amount to be reimbursed from the
developer. ASC 840-40-05-5 requires the Company to be considered the owner (for accounting purposes) of these types of projects during the construction
period and therefore is required to account for these projects as sale and leaseback transactions. As a result, the Company has recorded $30,956,000 and $31,970,000 as financing lease obligations for
failed sale leaseback transactions on its Consolidated Balance Sheets related to these types of projects as of April 1, 2010 and April 2, 2009, respectively.

Sale and Leaseback Transactions:The Company accounts for the sale and leaseback of real estate assets in accordance with ASC
840-40.
Losses on sale leaseback transactions are recognized at the time of sale if the fair value of the property sold is less than the undepreciated cost of the property. Gains on sale and leaseback
transactions are deferred and amortized over the remaining base term of the lease.

Impairment of Long-lived Assets:The Company reviews long-lived assets, including definite-lived intangibles, investments in
non-consolidated subsidiaries accounted for under the equity method, marketable equity securities and internal use software for impairment whenever events or changes in circumstances
indicate that the carrying amount of the assets may not be fully recoverable. The Company identifies impairments related to internal use software when management determines that the remaining carrying
value of the software will not be realized through future use. The Company reviews internal management reports on a quarterly basis as well as monitors current and potential future competition in the
markets where it operates for indicators of triggering events or circumstances that indicate potential impairment of individual theatre assets. The Company evaluates theatres using historical and
projected data of theatre level cash flow as its primary indicator of potential impairment and considers the seasonality of its business when making these evaluations. The Company performs its annual
impairment analysis during the fourth quarter because Christmas and New Year's holiday results comprise a significant portion of the Company's operating cash flow, and the actual results from this
period, which are available during the fourth quarter of each fiscal year, are an integral part of the impairment analysis. Under these analyses, if the sum of the estimated future cash flows,
undiscounted and without interest charges, are less than the carrying amount of the asset, an impairment loss is recognized in the amount by which the carrying value of the asset exceeds its estimated
fair value. Assets are evaluated for impairment on an individual theatre basis, which management believes is the lowest level for which there are identifiable cash flows. The impairment evaluation is
based on the estimated cash flows from continuing use until the expected disposal date or the fair value of furniture,

59

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

fixtures
and equipment. The expected disposal date does not exceed the remaining lease period unless it is probable the lease period will be extended and may be less than the remaining lease period
when the Company does not expect to operate the theatre to the end of its lease term. The fair value of assets is determined as either the expected selling price less selling costs (where appropriate)
or the
present value of the estimated future cash flows. The fair value of furniture, fixtures and equipment has been determined using similar asset sales and in some instances with the assistance of third
party valuation studies. The discount rate used in determining the present value of the estimated future cash flows was based on management's expected return on assets during fiscal 2010.

There
is considerable management judgment necessary to determine the estimated future cash flows and fair values of our theatres and other long-lived assets, and,
accordingly, actual results could vary significantly from such estimates which fall under Level 3 within the fair value measurement hierarchy, see Note 14Fair Value
Measurements. During fiscal 2010, the Company recognized non-cash impairment losses of $3,765,000 related to theatre fixed assets. The Company recognized an impairment loss of $2,330,000
on five theatres with 41 screens (in California, Florida, Maryland, New York and Utah), which was related to property, net. The Company also adjusted the carrying value of undeveloped real estate
assets located in Illinois based on a recent appraisal which resulted in an impairment charge of $1,435,000.

Impairment
losses in the Consolidated Statements of Operations are included in the following captions:

(In thousands)

52 weeks
Ended
April 1, 2010

52 weeks
Ended
April 2, 2009

53 weeks
Ended
April 3, 2008Impairment of long-lived assets

$
3,765

$
73,547

$
8,933Equity in (earnings) losses of non-consolidated entities





2,742


Investment income





1,512


Total impairment losses

$
3,765

$
77,801

$
8,933


Foreign Currency Translation:Operations outside the United States are generally measured using the local currency as the
functional currency. Assets
and liabilities are translated at the rates of exchange at the balance sheet date. Income and expense items are translated at average rates of exchange. The resultant translation adjustments are
included in foreign currency translation adjustment, a separate component of accumulated other comprehensive income (loss). Gains and losses from foreign currency transactions, except those
intercompany transactions of a long-term investment nature, are included in net earnings (loss).

Stock-based Compensation:Holdings has no stock-based compensation arrangements of its own; however its ultimate parent, AMC
Entertainment
Holdings, Inc. granted options on 60,243.17873 shares to certain employees during the periods ended March 31, 2005, March 30, 2006, April 2, 2009 and April 1, 2010.
Because the employees to whom the options were granted are employed by AMCE, AMCE has reflected the stock-based compensation expense associated with the options within its consolidated statements of
operations. The options have a ten year term and the options granted

60

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

during
fiscal 2005 step-vest in equal amounts over five years with the final vesting having occurred on December 23, 2009. The options granted during fiscal 2006 step-vest in equal
amounts over three years with final vesting having occurred on December 23, 2008. The options granted during fiscal 2009 step-vest in equal amounts over five years with final
vesting occurring on March 6, 2014, but vesting may accelerate for certain participants if there is a change of control (as defined in the plan). The options granted during fiscal 2010
step-vest in equal amounts over 5 years with final vesting occurring on May 28, 2014. Holdings has recorded $1,384,000, $2,622,000 and $207,000 of stock-based compensation
expense related to these options within general and administrative: other for fiscal 2010, 2009 and 2008, respectively.

The
options have been accounted for using the fair value method of accounting for stock-based compensation arrangements, and the Company has valued the options using the Black-Scholes
formula and has elected to use the simplified method for estimating the expected term of "plain vanilla" share option grants as it does not have enough historical experience to provide a reasonable
estimate.

The
following table reflects the weighted average fair value per option granted during each year, as well as the significant weighted average assumptions used in determining fair value
using the Black-Scholes option-pricing model:

April 1, 2010

April 2, 2009Weighted average fair value on grant date

$
135.71

$
129.46Risk-free interest rate


2.6
%

2.6
%Expected life (years)


6.5


6.5Expected volatility(1)


35.0
%

35.0
%Expected dividend yield








(1)The
Company uses share values of its publicly traded competitor peer group for purposes of calculating volatility.


Income Taxes:The Company accounts for income taxes in accordance with ASC 740-10. Under ASC 740-10, deferred income tax
effects of transactions reported in different
periods for financial reporting and income tax return purposes are recorded by the liability method. This method gives consideration to the future tax consequences of deferred income or expense items
and recognizes changes in income tax laws in the period of enactment. The income statement effect is generally derived from changes in deferred income taxes on the balance sheet.

AMCE
entered into a tax sharing agreement with Holdings and Parent under which AMCE agreed to make cash payments to Holdings and Parent to enable it to pay any (i) federal, state
or local income taxes to the extent that such income taxes are directly attributable to AMCE or its subsidiaries' income and (ii) franchise taxes and other fees required to maintain Holdings'
and Parent's legal existence.

Casualty Insurance:The Company is self-insured for general liability up to $500,000 per occurrence and carries a $400,000
deductible
limit per occurrence for workers compensation claims. The Company utilizes actuarial projections of its ultimate losses to calculate its reserves and expense. The actuarial method includes an
allowance for adverse developments on known claims and an allowance for claims which have been incurred but which have not yet been reported. As of April 1,

61

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

2010
and April 2, 2009, the Company had recorded casualty insurance reserves of $16,253,000 and $19,179,000, respectively, net of estimated insurance recoveries. The Company recorded expenses
related to general liability and workers compensation claims of $11,363,000, $10,537,000 and $14,836,000 for the periods ended April 1, 2010, April 2, 2009 and April 3, 2008,
respectively.

New Accounting Pronouncements:In January 2010, the Financial Accounting Standards Board ("FASB") issued Accounting Standards
Update ("ASU")
No. 2010-06,Fair Value Measurements and Disclosures (Topic 820)Improving Disclosures about Fair Value Measurements,
("ASU 2010-06"). This Update provides a greater level of disaggregated information and enhanced disclosures about valuation techniques and inputs to fair value measurements. ASU
2010-06 is effective for interim and annual reporting periods beginning after December 15, 2009 and is effective for the Company as of the end of fiscal 2010 except for the
disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. Those disclosures are effective for fiscal years beginning
after December 15, 2010, and for interim periods within those fiscal years and is effective for the Company as of the beginning of fiscal 2011. See Note 11Employee Benefit
Plans and Note 14Fair Value Measurements for required disclosures.

In
October 2009, the FASB issued ASU No. 2009-13,Revenue Recognition (Topic 605)Multiple-Deliverable Revenue
ArrangementsA Consensus of the FASB Emerging Issues Task Force, ("ASU 2009-13"). This Update provides amendments to the criteria in Subtopic
605-25 that addresses how to separate multiple-deliverable
arrangements and how to measure and allocate arrangement consideration to one or more units of accounting. In addition, this amendment significantly expands the disclosure requirements related to
multiple-deliverable revenue arrangements. ASU 2009-13 will be effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after
June 15, 2010 and is effective for the Company as of the beginning of fiscal 2012. Early adoption is permitted. The Company is in the process of evaluating the impact ASU 2009-13
will have on its financial statements.

In
June 2009, the FASB amended guidance for determining whether an entity is a variable interest entity and requires an analysis to determine whether the variable interest gives a
company a controlling financial interest in the variable interest entity. This guidance is included in ASC 810,Consolidation, which will require an
ongoing reassessment and eliminates the quantitative approach previously required for determining whether a company is the primary beneficiary. This guidance is effective as of the beginning of the
first fiscal year beginning after November 15, 2009 and is effective for the Company in the first quarter of fiscal 2011. The Company is in the process of determining what effects the
application of this guidance may have on its consolidated financial position, but does not believe the guidance will have a material impact.

In
December 2008, the FASB issued ASC 715-20-65, guidance for employers' disclosures about postretirement benefit plan assets, which requires additional fair
value disclosures about employers' defined benefit pension or other postretirement plan assets. Specifically, employers are required to disclose information about how investment allocation decisions
are made, the fair value of each major category of plan assets and information about the inputs and valuation techniques used to develop the fair value measurements of plan assets. This guidance is
effective for financial statements issued for fiscal years ending after December 15, 2009 and is effective for the Company in fiscal 2010. See Note 11Employee Benefit Plans
for required disclosures.

62

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 1THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

In
December 2007, the FASB revised ASC 805,Business Combinations, which addresses the accounting and disclosure for identifiable assets
acquired, liabilities assumed, and noncontrolling interests in a business combination. This statement requires all business combinations completed after the effective date to be accounted for by
applying the acquisition method (previously referred to as the purchase method); expands the definition of transactions and events that qualify as business combinations; requires that the acquired
assets and liabilities, including contingencies, be recorded at the fair value determined on the acquisition date and changes thereafter reflected in income, not goodwill; changes the recognition
timing for restructuring costs; and requires acquisition costs to be expensed as incurred rather than being capitalized as part of the cost of acquisition. This standard became effective in the first
quarter of fiscal 2010. The Company changed its accounting treatment for business combinations on a prospective basis. In addition, the reversal of valuation allowance for deferred tax assets related
to business combinations will flow through the Company's income tax provision, on a prospective basis, as opposed to goodwill.

Presentation:Effective April 3, 2009, certain advertising costs related to film exhibition were reclassified from operating
expense to film
exhibition costs with a conforming reclassification made for the prior year presentation. Effective April 1, 2010, preopening expense, theatre and other closure expense (income), and
disposition of assets and other losses (gains) were reclassified to operating expense with a conforming reclassification made for the prior year presentation. Additionally, in the consolidated
statements of cash flows, certain operating activities were reclassified to other, net and certain investing activities were reclassified to other, net, with conforming reclassifications made for the
prior year presentation. These presentation reclassifications reflect how management evaluates information presented in the statement of operations and consolidated statements of cash flows.

NOTE 2DISCONTINUED OPERATIONS

On December 29, 2008, the Company sold all of its interests in Cinemex, which then operated 44 theatres with 493 screens primarily in the Mexico City Metropolitan Area, to
Entretenimiento GM de Mexico S.A. de C.V. The operations and cash flows of the Cinemex theatres have been eliminated from the Company's ongoing operations as a result of the disposal
transaction. The purchase price received at the date of the sale and in accordance with the Stock Purchase Agreement was $248,141,000. During the year ended April 1, 2010, the Company received
payments of $4,315,000 for purchase price related to tax payments and refunds, and a working capital calculation and post closing adjustments. Additionally, the Company estimates that it is
contractually entitled to receive an additional $8,752,000 of the purchase price related to other tax payments and refunds. While the Company believes it is entitled to these amounts from Cinemex, the
resolution and collection will require litigation which was initiated by the Company on April 30, 2010. Resolution could take place over a prolonged period. As a result of the litigation, the
Company has established an allowance for doubtful accounts related to this receivable in the amount of $7,480,000 and further directly charged off $1,381,000 of certain amounts as uncollectible with
an offsetting charge of $8,861,000 recorded to loss on disposal included as a component of discontinued operations. The Company does not have any significant continuing involvement in the operations
of the Cinemex theatres after the disposition. The results of operations of the Cinemex theatres have been classified as discontinued operations for all periods presented.

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 2DISCONTINUED OPERATIONS (Continued)

Components of amounts reflected as earnings (loss) from discontinued operations in the Company's Consolidated Statements of Operations are presented in the following table:

Statements of operations data:

(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

53 Weeks
Ended
April 3, 2008RevenuesAdmissions

$


$
62,009

$
87,469Concessions





44,744


60,456Other theatre





21,755


23,358Total revenues





128,508


171,283Costs and ExpensesFilm exhibition costs





27,338


37,435Concession costs





10,158


13,949Operating expense





32,699


42,302Rent





14,934


18,540General and administrativeother





8,880


10,720Depreciation and amortization





21,070


29,083Loss (gain) on disposal


7,534


(14,772
)

Total costs and expenses


7,534


100,307


152,029Other Expense (Income)Other expense





416


501Interest expenseCorporate borrowings





7,299


11,282Capital and financing lease obligations





582


645Investment income





(1,124
)

(1,756
)Total other expense





7,173


10,672Earnings (loss) before income taxes


(7,534
)

21,028


8,582Income tax provision





11,300


6,780Net earnings (loss) from discontinued operations

$
(7,534
)
$
9,728

$
1,802


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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 3PROPERTY

A summary of property is as follows:

(In thousands)

April 1, 2010

April 2, 2009Property owned:Land

$
43,384

$
43,384Buildings and improvements


157,142


156,665Leasehold improvements


824,461


812,972Furniture, fixtures and equipment


1,243,323


1,253,0502,268,310


2,266,071Less-accumulated depreciation and amortization


1,421,367


1,319,353846,943


946,718Property leased under capital leases:Buildings and improvements


33,864


33,864Less-accumulated amortization


17,275


15,91416,589


17,950$
863,532

$
964,668


Property
is recorded at cost or fair value, in the case of property resulting from acquisitions. The Company uses the straight-line method in computing depreciation and
amortization for financial reporting purposes. The estimated useful lives for leasehold improvements reflect the shorter of the base terms of the corresponding lease agreements or the expected useful
lives of the assets. The estimated useful lives are as follows:

Buildings and improvements

5 to 40 yearsLeasehold improvements

1 to 20 yearsFurniture, fixtures and equipment

1 to 10 years


Expenditures
for additions (including interest during construction) and betterments are capitalized, and expenditures for maintenance and repairs are charged to expense as incurred. The
cost of assets retired or otherwise disposed of and the related accumulated depreciation and amortization are eliminated from the accounts in the year of disposal. Gains or losses resulting from
property disposals are included in operating expense in the accompanying consolidated statements of operations.

Depreciation
expense was $163,506,000, $174,851,000, and $190,194,000 for the periods ended April 1, 2010, April 2, 2009, and April 3, 2008, respectively.

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 4GOODWILL AND OTHER INTANGIBLE ASSETS

Activity of goodwill is presented below.

(In thousands)Balance as of April 3, 2008

$
2,070,858Currency translation adjustment


(45,977
)Fair value deferred tax asset adjustments LCE(1)


(31,515
)Disposition of Cinemex


(156,635
)Balance as of April 1, 2010 and April 2, 2009

$
1,836,731


(1)Adjustments
to fair value relate to the release of a valuation allowance initially recorded in purchase accounting for deferred tax assets related to net
operating loss carryforwards expected to be utilized by Parent in the future for a deferred taxable gain related to the purchase of term loans by Parent.


Activity
of other intangible assets is presented below:

April 1, 2010

April 2, 2009(In thousands)

Remaining
Useful Life

Gross
Carrying
Amount

Accumulated
Amortization

Gross
Carrying
Amount

Accumulated
AmortizationAmortizable Intangible Assets:Favorable leases

3 to 11 years

$
104,301

$
(43,782
)
$
104,646

$
(35,949
)Loyalty program

3 years


46,000


(38,870
)

46,000


(34,914
)LCE trade name

1 year


2,300


(1,920
)

2,300


(1,460
)LCE management contracts

13 to 21 years


35,400


(29,209
)

35,400


(27,893
)Other intangible assets

1 to 12 years


13,654


(13,442
)

13,654


(13,418
)Total, amortizable



$
201,655

$
(127,223
)
$
202,000

$
(113,634
)Unamortized Intangible Assets:AMC trademark



$
74,000




$
74,000


Amortization
expense associated with the intangible assets noted above is as follows:

(In thousands)

52 Weeks Ended
April 1, 2010

52 Weeks Ended
April 2, 2009

53 Weeks Ended
April 3, 2008Recorded amortization

$
13,934

$
21,481

$
28,387


Estimated
amortization expense for the next five fiscal years for intangible assets is projected below:

(In thousands)

2011

2012

2013

2014

2015Projected amortization expense

$
11,980

$
10,856

$
10,147

$
7,769

$
7,120


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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 5INVESTMENTS

Investments in non-consolidated affiliates and certain other investments accounted for under the equity method generally include all entities in which the Company or its
subsidiaries have significant influence, but not more than 50% voting control. Investments in non-consolidated affiliates as of April 1, 2010, include an 18.23% interest in National
CineMedia, LLC ("NCM"), a 50% interest in three U.S. motion picture theatres, a 26% equity interest in Movietickets.com, Inc. ("MTC"), a 50% interest in Midland Empire
Partners, LLC and a 29% interest in Digital Cinema Implementation Partners, LLC ("DCIP"). Financial results for the fifty-three weeks ended April 3, 2008 include a 50% interest in
Hoyts General Cinemas South America ("HGCSA"), an entity that operated 17 theatres in South America, which was disposed of in July 2007.

In
May 2007, the Company disposed of its investment in Fandango, Inc. ("Fandango"), accounted for using the cost method, for total proceeds of approximately $20,360,000, of which
$17,977,000 was received in May and September 2007 and $2,383,000 was received in November 2008. The Company recorded a gain on the sale recorded in investment income of approximately $15,977,000
during fiscal 2008 and $2,383,000 during fiscal 2009. In July 2007, the Company disposed of its investment in HGCSA for total proceeds of approximately $28,682,000 and recorded a gain on the sale
included in equity earnings of non-consolidated entities of approximately $18,751,000.

DCIP Transactions

On March 10, 2010, DCIP completed its financing transactions for the deployment of digital projection systems to nearly 14,000
movie theatre screens across North America, including screens operated or managed by AMC Entertainment Inc., Cinemark Holdings, Inc. ("Cinemark") and Regal Entertainment Group ("Regal").
At closing the Company contributed 342 projection systems that it owned to DCIP which were recorded at estimated fair value as part of an additional investment in DCIP of $21,768,000. The Company also
made cash investments in DCIP of $840,000 at closing and DCIP made a distribution of excess cash to us after the closing date and prior to year-end of $1,262,000. The Company recorded a
loss on contribution of the 342 projection systems of $563,000, based on the difference between estimated fair value and its carrying value on the date of contribution. On March 26, 2010, the
Company acquired 117 digital projectors from third party lessors for $6,784,000 and sold them together with seven digital projectors that it owned to DCIP for $6,570,000. The Company recorded a loss
on the sale of these 124 systems to DCIP of $697,000. As of April 1, 2010, the Company operated 568 digital projection systems leased from DCIP pursuant to operating leases and anticipates that
it will have deployed 4,000 of these systems in its existing theatres over the next three to four years.

The
digital projection systems leased from DCIP and its affiliates will replace most of the Company's existing 35 millimeter projection systems in its U.S. theatres. The Company is
examining its estimated depreciable lives for its existing equipment, with a net book value of approximately $14,224,000 that will be replaced and expects to accelerate the depreciation of these
existing 35 millimeter projection systems, based on the estimated digital projection system deployment timeframe.

NCM Transactions

On March 29, 2005, the Company along with Regal combined their screen advertising operations to form NCM. On July 15,
2005, Cinemark joined the NCM joint venture by contributing its screen

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 5INVESTMENTS (Continued)

advertising
business. On February 13, 2007, National CineMedia, Inc. ("NCM, Inc."), a newly formed entity that now serves as the sole manager of NCM, closed its initial public
offering, or IPO, of 42,000,000 shares of its common stock at a price of $21.00 per share.

In
connection with the completion of NCM, Inc.'s IPO, on February 13, 2007, the Company entered into the Third Amended and Restated Limited Liability Company Operating
Agreement (the "NCM Operating Agreement") among American Multi-Cinema, Inc., Regal and Cinemark (the "Founding Members"). Pursuant to the NCM Operating Agreement, the members are granted a
redemption right to exchange common units of NCM for NCM, Inc. shares of common stock on a one-for-one basis, or at the option of NCM, Inc., a cash payment equal
to the market price of one share of NCM, Inc.'s common stock. Upon execution of the NCM Operating Agreement, each existing preferred unit of NCM held by the Founding Members was redeemed in
exchange for $13.7782 per unit, resulting in the cancellation of each preferred unit. NCM used the proceeds of a new $725,000,000 term loan facility and $59,800,000 of net proceeds from the
NCM, Inc. IPO to redeem the outstanding preferred units. The Company received approximately $259,347,000 in the aggregate for the redemption of all its preferred units in NCM. The Company
received approximately $26,467,000 from selling common units in NCM to NCM, Inc. in connection with the exercise of the underwriters' over-allotment option in the NCM, Inc.
IPO.

Also
in connection with the completion of NCM, Inc.'s IPO, the Company agreed to modify NCM's payment obligations under the prior Exhibitor Services Agreement ("ESA") in exchange
for approximately $231,308,000. The ESA provides a term of 30 years for advertising and approximately five year terms (with automatic renewal provisions) for meeting event and digital
programming services, and provides NCM with a five year right of first refusal for the services beginning one year prior to the end of the term. The ESA also changed the basis upon which the Company
is paid by NCM from a percentage of revenues associated with advertising contracts entered into by NCM to a monthly theatre access fee. The theatre access fee is now composed of a fixed payment per
patron and a fixed payment per digital screen, which increases by 8% every five years starting at the end of fiscal 2011 for payments per patron and by 5% annually starting at the end of fiscal 2007
for payments per digital screen. The theatre access fee paid in the aggregate to the Founding Members will not be less than 12% of NCM's aggregate advertising revenue, or it will be adjusted upward to
meet this minimum payment. Additionally, the Company entered into the First Amended and Restated Loews Screen Integration Agreement with NCM on February 13, 2007, pursuant to which the Company
paid NCM an amount that approximated the EBITDA that NCM would have generated if it had been able to sell advertising in the Loews Cineplex Entertainment Corporation ("Loews") theatre chain on an
exclusive basis
commencing upon the completion of NCM, Inc.'s IPO, and NCM issued to AMC common membership units in NCM, increasing the Company's ownership interest to approximately 33.7%; such Loews payments
were made quarterly until the former screen advertising agreements expired in fiscal 2009. The Loews Screen Integration payments totaling $15,982,000 have been paid in full in fiscal 2010. The Company
is also required to purchase from NCM any on-screen advertising time provided to the Company's beverage concessionaire at a negotiated rate. In addition, the Company expects to receive
mandatory quarterly distributions of excess cash from NCM. Immediately following the NCM, Inc. IPO, the Company held an 18.6% interest in NCM.

68

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 5INVESTMENTS (Continued)

Annual
adjustments to the common membership units are made pursuant to the Common Unit Adjustment Agreement dated as of February 13, 2007 between NCM, Inc. and the Founding
Members. The adjustments to common membership units reflect changes in the number of theatre screens operated and attendance. Effective March 27, 2008, the Company received 939,853 common
membership units of NCM as a result of the Common Unit Adjustment, increasing the Company's interest in NCM to 19.1%. The Company recorded the additional units received as a result of the Common Unit
Adjustment at fair value and as a new investment (Tranche 2 Investment) with an offsetting adjustment to deferred revenue. Effective May 29, 2008, NCM issued 2,913,754 common membership
units to another founding member due to an acquisition, which caused a decrease in AMC's ownership share from 19.1% to 18.52%. Effective March 17, 2009, the Company received 406,371 common
membership units of NCM as a result of the Common Unit Adjustment, increasing the Company's interest in NCM to 18.53%. Effective March 17, 2010, the Company received 127,290 common membership
units of NCM. As a result of the Common Unit Adjustment among the founding members, the Company's interest in NCM decreased to 18.23%. The Company recorded the additional units received at fair value
with an offsetting adjustment to deferred revenue.

As
a result of NCM, Inc's IPO and debt financing, the Company recorded a change of interest gain of $132,622,000 and received distributions in excess of its investment in NCM related to
the redemption of preferred and common units of $106,188,000. The Company reduced its investment in NCM to zero and recognized the change of interest gain and the excess distribution as a gain in
equity in earnings of non-consolidated entities, as it has not guaranteed any obligations of NCM and is not otherwise committed to provide further financial support for NCM.

Following
the NCM, Inc. IPO, the Company will not recognize undistributed equity in the earnings on the original NCM membership units until NCM's future net earnings, less
distributions received, surpass the amount of the excess distribution. The Company will recognize equity in earnings only to the extent it receives cash distributions from NCM. The Company considers
the excess distribution as an advance on NCM's future earnings and, accordingly, future earnings of NCM should not be recognized through the application of equity method accounting until such time as
the Company's share of NCM's future earnings, net of distributions received, exceeds the excess distribution. The Company believes that the accounting model provided by ASC
323-10-35-22 for recognition of equity investee losses in
excess of an investor's basis is analogous to the accounting for equity income subsequent to recognizing an excess distribution.

Pursuant
to the Company's Tax Receivable Agreement with National CineMedia, Inc., the Company receives periodic distributions based on certain tax benefits related to the NCM
Transactions. As of April 1, 2010, the Company owns 18,948,404 units or an 18.23% interest in NCM. As a founding member, the Company has the ability to exercise significant control over the
governance of NCM, and, accordingly accounts for its investment following the equity method. The fair market value of the units in National CineMedia, LLC was approximately $334,629,000, based
on a price for shares of National CineMedia, Inc. on April 1, 2010 of $17.66 per share.

Related Party Transactions

As of April 1, 2010 and April 2, 2009, the Company has recorded $1,462,000 and $1,342,000, respectively, of amounts due
from NCM related to on-screen advertising revenue. As of April 1, 2010

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 5INVESTMENTS (Continued)

and
April 2, 2009, the Company had recorded $1,502,000 and $1,657,000, respectively, of amounts due to NCM related to the ESA and the Loews Screen Integration Agreement. The Company recorded
revenues for advertising from NCM of $20,352,000, $19,116,000 and $14,531,000 during the fifty-two weeks ended April 1, 2010, April 2, 2009, and the fifty-three weeks ended
April 3, 2008, respectively. The Company recorded expenses related to its beverage advertising agreement with NCM of $12,107,000, $15,118,000 and $16,314,000 during fiscal years 2010, 2009, and
2008, respectively.

Summary Financial Information

Condensed financial information of the Company's non-consolidated equity method investments is shown below. Amounts are
presented under U.S. GAAP for the periods of ownership by the Company.

Financial
Condition:

(In thousands)

April 1, 2010

April 2, 2009Current assets

$
145,019

$
110,184Noncurrent assets


386,830


252,163Total assets


531,849


362,347Current liabilities


38,521


71,448Noncurrent liabilities


960,665


892,376Total liabilities


999,186


963,824Stockholders' deficit


(467,337
)

(601,477
)Liabilities and stockholders' deficit


531,849


362,347The Company's recorded investment(1)

$
69,922

$
47,439


(1)Certain
differences in the Company's recorded investment over its proportional ownership share are amortized to equity in (earnings) or losses over the
estimated useful life of the underlying assets or liabilities. The recorded equity in earnings of NCM on common membership units owned immediately following the IPO of NCM, Inc.
(Tranche 1 Investment) does not include undistributed equity in earnings. The Company considered the excess distribution received following NCM, Inc.'s IPO as an advance on NCM's future
earnings. As a result, the Company will not recognize any undistributed equity in earnings of NCM on the original common membership units (Tranche 1 Investment) until NCM's future net earnings
equal the amount of the excess distribution.


Included
in impairment of long-lived assets for the fifty-two weeks ended April 2, 2009 is an impairment charge of $2,742,000 related to a theatre joint
venture investment. The decline in the fair market value of the investment was considered other than temporary due to competitive theatre builds.

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 5INVESTMENTS (Continued)

Operating
Results:

(In thousands)

52 Weeks Ended
April 1, 2010

52 Weeks Ended
April 2, 2009

53 Weeks Ended
April 3, 2008Revenues

$
432,551

$
419,401

$
322,536Operating costs and expenses


310,819


318,774


214,144Net earnings


121,732


100,627


108,392The Company's recorded equity in earnings


30,300


24,823


43,019


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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 5INVESTMENTS (Continued)

The
Company recorded the following changes in the carrying amount of its investment in NCM and equity in (earnings) losses of NCM during the fifty-three weeks ended April 3, 2008,
and the fifty-two weeks ended April 2, 2009 and April 1, 2010.

(In thousands)

Investment in
NCM(1)

Deferred
Revenue(2)

Due to
NCM(3)

Cash
Received
(Paid)

Equity in
(Earnings)
Losses

Advertising
(Revenue)Ending balance March 29, 2007

$


$
(231,045
)
$
(15,850
)
$


$


$
Receipt of excess cash distributions











22,175


(22,175
)

Payments on Loews' Screen Integration Agreement








11,201


(11,201
)




Receipt of Common Units


21,598


(21,598
)










Amortization of deferred revenue





2,331











(2,331
)Ending balance April 3, 2008

$
21,598

$
(250,312
)
$
(4,649
)
$
10,974

$
(22,175
)
$
(2,331
)Receipt under Tax Receivable Agreement

$


$


$


$
3,796

$
(3,796
)
$
Receipt of Common Units


5,453


(5,453
)










Receipt of excess cash distributions


(1,241
)







24,308


(23,067
)

Payments on Loews' Screen Integration Agreement








4,700


(4,700
)




Increase Loews' Screen Integration Liability








(132
)




132


Change in interest loss(4)


(83
)










83


Amortization of deferred revenue





2,601











(2,601
)Equity in earnings(5)


1,006











(1,006
)

Ending balance April 2, 2009

$
26,733

$
(253,164
)
$
(81
)
$
23,404

$
(27,654
)
$
(2,601
)Receipt under Tax Receivable Agreement

$


$


$


$
8,788

$
(8,788
)
$
Receipt of Common Units


2,290


(2,290
)










Receipt of excess cash distributions


(1,847
)







25,827


(23,980
)

Payment on Loews' Screen Integration Agreement








81


(81
)




Receipt of tax credits


(1
)







18


(17
)

Change in interest loss(4)


(57
)










57


Amortization of deferred revenue





3,132











(3,132
)Equity in earnings(5)


1,708











(1,708
)

Ending balance April 1, 2010

$
28,826

$
(252,322
)
$


$
34,552

$
(34,436
)
$
(3,132
)


(1)The
NCM common membership units held by AMC immediately following the NCM, Inc. IPO are carried at zero cost (Tranche 1 Investment). As
provided under the Common Unit Adjustment Agreement dated as of February 13, 2007, AMC received additional NCM common membership


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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 5INVESTMENTS (Continued)

units
in fiscal 2008, 2009 and 2010, valued at $21,598,000, $5,453,000 and $2,290,000, respectively (Tranche 2 Investments). (2)Represents
the unamortized portion of the Exhibitors Services Agreement (ESA) modifications payment received from NCM.(3)Represents
the amount due to NCM under the Loews Screen Integration Agreement that was fully paid in April 2009.(4)AMC's
ownership share decreased from 19.1% to 18.52% effective May 29, 2008 due to NCM's issuance of 2,913,754 common membership units to another
founding member due to an acquisition. In fiscal 2010, AMC's ownership share decreased to 18.23% due to the allocation of the annual Common Unit Adjustment.(5)Represents
equity in earnings on the Tranche 2 Investments only.


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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 6SUPPLEMENTAL BALANCE SHEET INFORMATION

Other assets and liabilities consist of the following:

(In thousands)

April 1, 2010

April 2, 2009Other current assets:Prepaid rent

$
34,442

$
34,135Income taxes receivable


2,144


8,757Prepaid insurance and other


12,127


16,854Merchandise inventory


8,222


6,745Deferred tax asset


9,200


7,800Other


6,784


6,235$
72,919

$
80,526Other long-term assets:Investments in real estate

$
5,126

$
6,561Deferred financing costs


32,712


26,037Investments in joint ventures


69,922


47,439Computer software


28,817


31,249Deferred tax asset


95,300


30,200Other


6,226


4,602$
238,103

$
146,088Accrued expenses and other liabilities:Taxes other than income

$
39,470

$
40,175Interest


29,690


15,596Payroll and vacation


8,327


7,855Current portion of casualty claims and premiums


6,005


7,923Accrued bonus


15,964


1,183Theatre and other closure


6,694


7,386Accrued licensing and percentage rent


17,926


7,280Current portion of pension and other benefits liabilities


1,423


1,549Other


17,775


13,123$
143,274

$
102,070Other long-term liabilities:Unfavorable lease obligations

$
128,027

$
139,537Deferred rent


98,034


86,420Pension and other benefits


42,545


37,642Deferred gain


17,454


15,899Tax liability


7,000


7,000Casualty claims and premiums


12,250


14,600Other


4,281


7,605$
309,591

$
308,703


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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 7CORPORATE BORROWINGS AND CAPITAL AND FINANCING LEASE OBLIGATIONS

A summary of the carrying value of corporate borrowings and capital and financing lease obligations is as follows:

(In thousands)

April 1, 2010

April 2, 2009Senior Secured Credit Facility-Term Loan (2.00% as of April 1, 2010)

$
622,375

$
628,875Senior Secured Credit Facility-Revolver





185,00085/8% Senior Fixed Rate Notes due 2012





250,0008% Senior Subordinated Notes due 2014


299,227


299,06612% Senior Discount Notes due 2014


240,795


240,79511% Senior Subordinated Notes due 2016


325,000


325,0008.75% Senior Fixed Rate Notes due 2019


586,252


Capital and financing lease obligations, 9% - 11.5%


57,286


60,7092,130,935


1,989,445Less: current maturities


(10,463
)

(9,923
)$
2,120,472

$
1,979,522


Minimum
annual payments required under existing capital and financing lease obligations (net present value thereof) and maturities of corporate borrowings as of April 1, 2010 are
as follows:

Capital and Financing Lease ObligationsPrincipal
Amount of
Corporate
Borrowings(In thousands)

Minimum Lease
Payments

Less Interest

Principal

Total2011

$
9,225

$
5,262

$
3,963

$
6,500

$
10,4632012


8,023


4,870


3,153


6,500


9,6532013


7,055


4,578


2,477


609,375


611,8522014


6,706


4,338


2,368


300,000


302,3682015


6,728


4,083


2,645


240,795


243,440Thereafter


61,900


19,220


42,680


925,000


967,680Total

$
99,637

$
42,351

$
57,286

$
2,088,170

$
2,145,456


Senior Secured Credit Facility

The senior secured credit facility is with a syndicate of banks and other financial institutions and provides AMC Entertainment
financing of up to $850,000,000, consisting of a $650,000,000 term loan facility with a maturity date of January 26, 2013 and a $200,000,000 revolving credit facility that matures in 2012. The
revolving credit facility includes borrowing capacity available for letters of credit and for swingline borrowings on same-day notice. As of April 1, 2010, AMC Entertainment had
approximately $12,832,000 in outstanding letters of credit, leaving $187,168,000 available to borrow against the revolving credit facility.

Borrowings
under the senior secured credit facility bear interest at a rate equal to an applicable margin plus, at the Company's option, either a base rate or LIBOR. On March 13,
2007, the Company

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 7CORPORATE BORROWINGS AND CAPITAL AND FINANCING LEASE OBLIGATIONS (Continued)

amended
the senior secured credit facility to, among other things, lower the interest rates related to its term loan, reduce its unused commitment fee and amend the change of control definition so
that an
initial public offering and related transactions would not constitute a change of control. The current applicable margin for borrowings under the revolving credit facility is 0.75% with respect to
base rate borrowings and 1.75% with respect to LIBOR borrowings, and the current applicable margin for borrowings under the term loan facility is 0.75% with respect to base rate borrowings and 1.75%
with respect to LIBOR borrowings. In addition to paying interest on outstanding principal under the senior secured credit facility, AMC Entertainment is required to pay a commitment fee to the lenders
under the revolving credit facility in respect of the unutilized commitments thereunder at a rate equal to 0.25%. It will also pay customary letter of credit fees. AMC Entertainment may voluntarily
repay outstanding loans under the senior secured credit facility at any time without premium or penalty, other than customary "breakage" costs with respect to LIBOR loans. AMC Entertainment is
required to repay $1,625,000 of the term loan quarterly, beginning March 30, 2006 through September 30, 2012, with any remaining balance due on January 26, 2013.

All
obligations under the senior secured credit facility are guaranteed by each of AMC Entertainment's wholly-owned domestic subsidiaries. All obligations under the senior secured credit
facility, and the guarantees of those obligations (as well as cash management obligations and any interest hedging or other swap agreements), are secured by substantially all of AMC Entertainment's
assets as well as those of each subsidiary guarantor.

The
senior secured credit facility contains a number of covenants that, among other things, restrict, subject to certain exceptions, AMC Entertainment's ability, and the ability of its
subsidiaries, to sell assets; incur additional indebtedness; prepay other indebtedness (including the notes); pay dividends and distributions or repurchase their capital stock; create liens on assets;
make investments; make certain acquisitions; engage in mergers or consolidations; engage in certain transactions with affiliates; amend certain charter documents and material agreements governing
subordinated indebtedness, including the Existing Subordinated Notes; change the business conducted by it and its subsidiaries; and enter into agreements that restrict dividends from subsidiaries.

In
addition, the senior secured credit facility requires, commencing with the fiscal quarter ended September 28, 2006, that AMC Entertainment and its subsidiaries maintain a
maximum net senior secured leverage ratio as long as the commitments under the revolving credit facility remain outstanding. The senior secured credit facility also contains certain customary
affirmative covenants and events of default.

AMCE
is restricted, in certain circumstances, from paying dividends to Holdings by the terms of the indentures governing its outstanding senior and subordinated notes and its senior
secured credit facility. AMCE has not guaranteed the indebtedness of Holdings nor pledged any of its assets as collateral.

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 7CORPORATE BORROWINGS AND CAPITAL AND FINANCING LEASE OBLIGATIONS (Continued)

Fixed Notes due 2012

In connection with the merger with Marquee, AMC Entertainment became the obligor of $250,000,000 aggregate principal amount of
85/8% Senior Notes due 2012 (the "Fixed Notes due 2012"), that were previously issued by Marquee on August 18, 2004.

On
June 9, 2009, AMC Entertainment completed the offering of $600,000,000 aggregate principal amount of its 8.75% Senior Notes due 2019 (the "Notes due 2019"). Concurrently with
the initial notes offering, AMCE launched a cash tender offer and consent solicitation for any and all of its then outstanding $250,000,000 aggregate principal amount of the Fixed Notes due 2012 at a
purchase price of $1,000 plus a $30 consent fee for each $1,000 of principal amount of currently outstanding Fixed Notes due 2012 validly tendered and accepted by AMCE on or before the early tender
date (the "Cash Tender Offer"). AMCE used the net proceeds from the issuance of the Notes due 2019 to pay the consideration for the Cash Tender Offer plus accrued and unpaid interest on $238,065,000
principal amount of the Fixed Notes due 2012. AMCE recorded a loss on extinguishment related to the Cash Tender Offer of $10,826,000 in Other expense during the fifty-two weeks ended
April 1, 2010, which included previously capitalized deferred financing fees of $3,312,000, a consent fee paid to the holders of $7,142,000 and other expenses of $372,000. On August 15,
2009, AMCE redeemed the remaining $11,935,000 of Fixed Notes due 2012 at a price of $1,021.56 per $1,000 principal in accordance with the terms of the indenture. AMCE recorded a loss of $450,000 in
Other expense related to the extinguishment of the remaining Fixed Notes due 2012 during the fifty-two weeks ended April 1, 2010, which included previously capitalized deferred
financing fees of $157,000, consent fee paid to the holders of $257,000 and other expenses of $36,000.

Notes Due 2014

On February 24, 2004, AMC Entertainment sold $300,000,000 aggregate principal amount of 8% Senior Subordinated Notes due 2014
(the "Notes due 2014"). AMC Entertainment applied the net proceeds from the sale of Notes due 2014, plus cash on hand, to redeem all outstanding $200,000,000 aggregate principal amount of its
91/2% Senior Subordinated Notes due 2009 and $83,406,000 aggregate principal amount of its Notes due 2011. The Notes due 2014 bear interest at the rate of 8% per annum, payable in March
and September. The Notes due 2014 are redeemable at the option of AMC Entertainment, in whole or in part, at any time on or after March 1, 2009 at 104% of the principal amount thereof,
declining ratably to 100% of the principal amount thereof on or after March 1, 2012, plus in each case interest accrued to the redemption date. The Notes due 2014 are subordinated to all
existing and future senior indebtedness of AMC Entertainment. The Notes due 2014 are unsecured senior subordinated indebtedness of AMC Entertainment ranking equally with AMC Entertainment's Notes due
2016.

The
indenture governing the Notes due 2014 contains certain covenants that, among other things, may limit the ability of AMC Entertainment and its subsidiaries to incur additional
indebtedness and pay dividends or make distributions in respect of their capital stock.

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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 7CORPORATE BORROWINGS AND CAPITAL AND FINANCING LEASE OBLIGATIONS (Continued)

In
connection with the merger with Marquee, the carrying value of the Notes due 2014 was adjusted to fair value. As a result, a discount of $1,500,000 was recorded and will be amortized
to interest expense over the remaining term of the notes.

Notes Due 2016

On January 26, 2006, AMC Entertainment issued $325,000,000 aggregate principal amount of 11% Senior Subordinated Notes (the
"Notes due 2016") issued under an indenture (the "Indenture"), with HSBC Bank USA, National Association, as trustee. The Notes due 2016 will bear interest at a rate of 11% per annum, payable on
February 1 and August 1 of each year (commencing on August 1, 2006), and have a maturity date of February 1, 2016.

The
Notes due 2016 are general unsecured senior subordinated obligations of AMC Entertainment, fully and unconditionally guaranteed, jointly and severally, on a senior subordinated basis
by each of AMC Entertainment's existing and future domestic restricted subsidiaries that guarantee AMC Entertainment's other indebtedness.

AMC
Entertainment may redeem some or all of the Notes due 2016 at any time on or after February 1, 2011 at 105.5% of the principal amount thereof, declining ratably to 100% of the
principal amount thereof on or after February 1, 2014.

The
indenture governing the Notes due 2016 contains covenants limiting other indebtedness, dividends, purchases or redemptions of stock, transactions with affiliates and mergers and
sales of assets. It also contains provisions subordinating AMC Entertainment's obligations under the Notes due 2016 to AMC Entertainment's obligations under its senior secured credit facility and
other senior indebtedness.

Notes Due 2019

On June 9, 2009, AMC Entertainment issued $600,000,000 aggregate principal amount of 8.75% Senior Notes (the "Notes due 2019")
issued under an indenture (the "Indenture"), with U.S. Bank, National Association, as trustee. The Notes due 2019 bear interest at a rate of 8.75% per annum, payable on June 1 and
December 1 of each year (commencing on December 1, 2009), and have a maturity date of June 1, 2019.

The
Notes due 2019 are general unsecured senior obligations of AMC Entertainment, fully and unconditionally guaranteed, jointly and severally, on a senior basis by each of AMC
Entertainment's existing and future domestic restricted subsidiaries that guarantee AMC Entertainment's other indebtedness.

The
Notes due 2019 are redeemable at AMCE's option in whole or in part, at any time on or after June 1, 2014 at 104.375% of the principal amount thereof, declining ratably to 100%
of the principal amount thereof on or after June 1, 2017. In addition, AMC Entertainment may redeem up to 35% of the aggregate principal amount of the notes using net proceeds from certain
equity offerings completed on or prior to June 1, 2012 at a redemption price of 108.75%.

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 7CORPORATE BORROWINGS AND CAPITAL AND FINANCING LEASE OBLIGATIONS (Continued)

The
indenture governing the Notes due 2019 contains covenants limiting other indebtedness, dividends, purchases or redemptions of stock, transactions with affiliates and mergers and
sales of assets. It also contains provisions subordinating AMC Entertainment's obligations under the Notes due 2019 to AMC Entertainment's obligations under its senior secured credit facility and
other senior indebtedness. The Notes due 2019 were issued at a 2.418% discount which is amortized to interest expense following the interest method over the term of the notes.

As
of April 1, 2010, the Company was in compliance with all financial covenants relating to the senior secured credit facility, the Notes due 2016, Discount Notes due 2014, the
Notes due 2014 and the Notes due 2019.

Change of Control

Upon a change of control (as defined in the indentures), AMCE would be required to make an offer to repurchase all of the outstanding
Notes due 2019, Notes due 2016, and Notes due 2014 at a price equal to 101% of the principal amount thereof plus accrued and unpaid interest to the date of repurchase. The Sponsors are considered
Permitted Holders as defined in each of the indentures and as such could create certain voting arrangements that would not constitute a change of control under the indentures.

Holdings Discount Notes Due 2014

To help finance the merger with Marquee, Holdings issued $304,000,000 aggregate principal amount at maturity of its 12% Senior Discount
Notes due 2014 ("Discount Notes due 2014") for gross proceeds of $169,917,760. The indenture governing the Discount Notes due 2014 contains certain covenants that, among other things, may limit the
ability of the Company and its subsidiaries to incur additional indebtedness and pay dividends or make distributions in respect of their capital stock.

The
indentures relating to the Discount Notes due 2014 allows the Company to incur specified permitted indebtedness (as defined therein) without restriction. The indenture also allows
the Company to incur any amount of additional debt, including borrowings under the revolving portion of AMCE's senior secured credit facility, as long as the Company can satisfy the applicable
coverage ratio of each indenture, after giving effect to the event on a pro forma basis under the indenture for the Discount Notes due 2014. Under the indenture relating to the Senior Discount Notes
due 2014 (the Company's most restrictive indenture), the Company could borrow approximately $220,600,000 (assuming an interest rate of 8.25% per annum on the additional indebtedness) in addition to
specified permitted indebtedness. If the Company cannot satisfy the applicable coverage ratios of the indentures, generally the Company can incur, in addition to amounts borrowed under the senior
secured credit facility, no more than $100,000,000 of new "permitted indebtedness" under the terms of the indentures relating to the Company's notes and the Parent Term Loan Facility.

Holdings
is a holding company with no operations of its own and has no ability to service interest or principal on the Discount Notes due 2014 other than through any dividends it may
receive from AMCE. AMCE will be restricted, in certain circumstances, from paying dividends to Holdings by the terms of the indentures governing the Notes due 2014, the Notes due 2016, the Notes due
2019 and the

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 7CORPORATE BORROWINGS AND CAPITAL AND FINANCING LEASE OBLIGATIONS (Continued)

senior
secured credit facility. Under the most restrictive of these provisions, set forth in the Indenture for the Notes due 2016, the amount of loans and dividends which AMCE could make to Holdings
may not exceed approximately $309,752,000 in the aggregate as of April 1, 2010. AMCE has not guaranteed the indebtedness of Holdings nor pledged any of its assets as collateral and the
obligation is not reflected on AMCE's balance sheet.

On
any interest payment date prior to August 15, 2009, Holdings was permitted to commence paying cash interest (from and after such interest payment date) in which case
(i) Holdings would be obligated to pay cash interest on each subsequent interest payment date, (ii) the notes would cease to accrete after such interest payment date and (iii) the
outstanding principal amount at the maturity of each note would be equal to the accreted value of such notes as of such interest payment date. Holdings commenced paying cash interest on
August 16, 2007 and made its first semi-annual interest payment on February 15, 2008 at which time the principal became fixed at $240,795,000.

Upon
a change of control (as defined in the indentures), Holdings would be required to make an offer to repurchase all of the outstanding Discount Notes due 2014 at a price equal to 101%
of the principal amount thereof plus accrued and unpaid interest.

Parent Term Loan Facility

To help finance the dividend paid by Parent to its stockholders discussed in Note 8Stockholder's Equity, Parent
entered into a $400,000,000 Credit Agreement dated as of June 13, 2007 ("Parent Term Loan Facility") for net proceeds of $396,000,000. Costs related to the issuance of the Parent Term Loan
Facility were capitalized and are charged to interest expense, following the interest method, over the life of the Parent Term Loan Facility. During fiscal 2010, Parent made payments to purchase term
loans and reduce the principal balance of its Parent Term Loan Facility from $466,936,000 to $193,290,000 with a portion of the dividend provided by the Company. As of April 1, 2010, the
principal balance of the Parent Term Loan Facility, including unpaid interest, was $198,973,000 and the interest rate on borrowings thereunder was 5.26% per annum.

Parent
is a holding company with no operations of its own and has no ability to service interest or principal on the Parent Term Loan Facility other than through dividends it may receive
from Holdings
and AMCE. Holdings and AMCE are restricted, in certain circumstances, from paying dividends to Parent by the terms of the indentures governing their Notes due 2014, Notes due 2016, Discount Notes due
2014, Notes due 2019 and the senior secured credit facility. Holdings and AMCE have not guaranteed the indebtedness of Parent nor pledged any of their assets as collateral and the obligation is not
reflected on AMCE's or Holdings' balance sheet.

Borrowings
under the Parent Term Loan Facility bear interest at a rate equal to an applicable margin plus, at the Parent's option, either a base rate or LIBOR. The initial applicable
margin for borrowings under the Parent Term Loan Facility is 4.00% with respect to base rate borrowings and 5.00% with respect to LIBOR borrowings. Interest on borrowings under the Parent Term Loan
Facility is payable on each March 15, June 15, September 15, and December 15, beginning September 15, 2007 by adding such interest for the applicable period to the
principal amount of the outstanding loans.

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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 7CORPORATE BORROWINGS AND CAPITAL AND FINANCING LEASE OBLIGATIONS (Continued)

Parent
is required to pay an administrative agent fee to the lenders under the Parent Term Loan Facility of $100,000 annually.

Parent
may voluntarily repay outstanding loans under the Parent Term Loan Facility, in whole or in part, together with accrued interest to the date of such prepayment on the principal
amount prepaid at any time on or before June 13, 2010 at 101% of principal and at 100% of principal thereafter. Unpaid principal and interest on outstanding loans under the Parent Term Loan
Facility are required to be repaid upon maturity on June 13, 2012.

Upon
a change of control (as defined in the Parent Term Loan Facility), Lenders have the right to require Parent to prepay the Parent Term Loan Facility at a price equal to 101% of the
principal amount thereof plus accrued and unpaid interest. The Sponsors are considered Permitted Holders as defined in the Parent Term Loan Facility and as such could create certain voting
arrangements that would not constitute a change of control under the Parent Term Loan Facility. In the event of a qualified equity issuance offer as defined in the Parent Term Loan Facility, Parent
will, to the extent lawful, prepay the maximum principal amount of loans properly tendered that may be purchased out of any qualified equity issuance net proceeds at a prepayment price in cash equal
to 100% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of prepayment.

The
Parent Term Loan Facility contains certain covenants that, among other things, may limit the ability of the Parent to incur additional indebtedness and pay dividends or make
distributions in respect of its capital stocks, and this obligation is not reflected on AMCE's balance sheet.

NOTE 8STOCKHOLDER'S EQUITY

Holdings has one share of Common Stock issued as of April 1, 2010 which is owned by Parent.

On
June 20, 2005, Holdings entered into a merger agreement ("Merger Agreement") with LCE Holdings, Inc. ("LCE Holdings"), the parent of Loews Cineplex Entertainment
Corporation ("Loews"), pursuant to which LCE Holdings merged with and into Holdings, with Holdings continuing as the holding company for the merged businesses, and Loews merged with and into AMCE,
with AMCE continuing after the merger (the "Merger" and collectively, the "Mergers"). The transaction closed on January 26, 2006.

Pursuant
to the terms of the Merger Agreement, on January 26, 2006, in connection with the consummation of the Merger, Holdings issued 256,085.61252 voting shares of
Class L-1 Common Stock, par value $0.01 per share ("Class L-1 Common Stock"), 256,085.61252 voting shares of Class L-2 Common Stock, par value
$0.01 per share ("Class L-2 Common Stock" and, together with the Class L-1 Common Stock, the "Class L Common Stock"), 382,475 voting shares of
Class A-1 Common Stock, par value $0.01 per share (the "Class A-1 Common Stock"), 382,475 voting shares of Class A-2 Common Stock, par value
$0.01 per share (the "Class A-2 Common Stock" and, together with the Class A-1 Common Stock, the "Class A Common Stock"), and 5,128.77496 nonvoting shares
of Class N Common Stock, par value $0.01 per share (the Class N Common Stock"), such that (i) the former non-management stockholders of LCE Holdings, including the
Bain Investors, the Carlyle Investors and the Spectrum Investors (collectively, the "Former LCE Sponsors"), hold all of the outstanding shares of Class L Common Stock, (ii) the
pre-existing non-management stockholders of

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 8STOCKHOLDER'S EQUITY (Continued)

Holdings,
including the JPMP Investors and the Apollo Investors (collectively, the "Pre-Existing Holdings Sponsors" and, the Pre-Existing Holdings Sponsors together with the
Former LCE Sponsors, the "Sponsors") and other co-investors (the "Coinvestors"), hold all of the outstanding shares of Class A Common
Stock, and (iii) management stockholders of Holdings (the "Management Stockholders" and, together with the Sponsors and Coinvestors, the "Stockholders") hold all of the non-voting
Class N Common Stock.

The
Class L Common Stock, Class A Common Stock and Class N Common Stock will automatically convert on a one-for-one basis into shares of
Residual Common Stock, par value $0.01 per share, upon (i) written consent of each of the Sponsors or (ii) the completion of an initial public offering of capital stock of Parent,
Holdings or AMCE (an "IPO").

The
issuance of the equity securities was exempt from registration under the Securities Act of 1933 and the rules promulgated thereunder (the "Securities Act") in reliance on
Section 4(2) of the Securities Act, as transactions by an issuer not involving a public offering.

On
June 11, 2007, Marquee Merger Sub Inc. ("merger sub"), a wholly-owned subsidiary of Parent, merged with and into Holdings, with Holdings continuing as the surviving
corporation ("holdco merger"). As a result of the holdco merger, (i) Holdings became a wholly owned subsidiary of Parent, a newly formed entity controlled by the Sponsors, (ii) each
share of Holdings' common stock that was issued and outstanding immediately prior to the effective time of the holdco merger was automatically converted into a substantially identical share of common
stock of Parent, and (iii) as further described in this report, each of Holdings' governance agreements was superseded by a substantially identical governance agreement entered into by and
among Parent, the Sponsors and Holdings' other stockholders. The holdco merger was effected by the Sponsors to facilitate a previously announced debt financing by Parent and a related dividend to its
stockholders. Parent used cash derived from AMCE and proceeds from the issuance of a $400,000,000 Credit Agreement issued by Parent (See Note 7) to pay a dividend to its stockholders of
$652,800,000 during fiscal year 2008.

On
June 12, 2007, Holdings announced that it had completed a solicitation of consents from holders of its Discount Notes due 2014, and that it had received consents for
$301,933,000 in aggregate principal amount at maturity of the Discount Notes due 2014, representing 99.32% of the outstanding Discount Notes due 2014. In connection with the receipt of consents,
Holdings paid an aggregate consent fee of approximately $4,360,000, representing a consent fee of $14.44 for each $1,000 in principal amount at maturity of Discount Notes due 2014 to which consents
were delivered. Accordingly, the requisite consents to adopt the proposed amendment (the "Amendment") to the indenture pursuant to which the Discount Notes due 2014 were issued were received, and a
supplemental indenture to effect the Amendment was executed by Holdings and the trustee under the indenture. The Amendment revised the restricted payments covenant to permit Holdings to make
restricted payments in an aggregate amount of $275,000,000 prior to making an election to pay cash interest on its senior discount notes. The Amendment also contained a covenant by Holdings to make an
election on August 15, 2007, the next semi-annual accretion date under the indenture, to pay cash interest on the senior discount notes. As a result, Holdings made its first cash
interest payment on the senior discount notes on February 15, 2008. Holdings used cash on hand at AMCE to pay a dividend to Parent in an aggregate amount of $270,588,000.

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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 8STOCKHOLDER'S EQUITY (Continued)

During
fiscal 2009, Holdings distributed to Parent $3,349,000 which has been recorded by Holdings as a reduction to additional paid-in capital. Parent used the available
funds to repurchase treasury stock and pay corporate overhead expenses incurred in the ordinary course of business.

During
fiscal 2010, Holdings used cash received from AMCE to pay a dividend distribution of $300,881,000 to Parent. Parent made payments to purchase term loans and reduced the principal
balance of its Parent Term Loan Facility from $466,936,000 to $193,290,000 with a portion of the dividend proceeds.

As
discussed in Note 9Income Taxes, the Company adopted the accounting guidance for uncertainty in income taxes under ASC 740,Income
Taxes, on March 30, 2007. The cumulative effect of the change on adoption charged to accumulated deficit was $5,373,000. As discussed in
Note 11Employee Benefit Plans, the Company adopted the amended provisions of ASC 715,Compensation-Retirement Benefits, and recorded
an $82,000 loss to fiscal 2009 opening accumulated deficit.

Common Stock Rights and Privileges

Parent's Class A-1 voting Common Stock, Class A-2 voting Common Stock, Class N nonvoting
Common Stock, Class L-1 voting Common Stock and Class L-2 voting Common Stock entitle the holders thereof to the same rights and privileges, subject to the same
qualifications, limitations and restrictions with respect to dividends. Additionally, each share of Class A Common Stock, Class L Common Stock and Class N Common Stock shall
automatically convert into one share of Residual Common Stock on a one-for-one basis immediately prior to the consummation of an Initial Public Offering.

Stock-Based Compensation

The Company has no stock-based compensation arrangements of its own, but Parent, has adopted a stock-based compensation plan that
permits grants of up to 49,107.44681 options on Parent's stock and has granted options on 4,786.0000, 15,980.45, 600.00000 and 38,876.72873 of its shares to certain employees during the periods ended
April 1, 2010, April 2, 2009, March 30, 2006 and March 31, 2005, respectively. As of April 1, 2010, there was $2,166,000 of total estimated unrecognized compensation
cost related to nonvested stock-based compensation arrangements under the Holdings plan expected to be recognized over five years.

Since
the employees to whom the options were granted are employed by the Company, the Company is required to reflect the stock-based compensation expense associated with the options
within its consolidated statements of operations. The options have a ten year term, the options granted during fiscal 2005 step-vest in equal amounts over five years with the final vesting
having occurred on December 23, 2009, the options granted during fiscal 2006 step-vest in equal amounts over three years with final vesting occurring on December 23, 2008, the options
granted in fiscal 2009 step-vest in equal amounts over five years with final vesting occurring on March 6, 2014 and the options granted in fiscal 2010 step-vest
in equal amounts over five years with final vesting occurring on May 28, 2014, but vesting may accelerate for one participant if there is a change of control (as defined in the plan).
One of the holders of options fully vested during fiscal 2007 upon entry into his employment separation and general release agreement on March 20, 2007. The Company has recorded $1,384,000,
$2,622,000 and

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 8STOCKHOLDER'S EQUITY (Continued)

$207,000
of stock-based compensation expense related to these options within general and administrative: other and has recognized an income tax benefit of $0 in its Consolidated Statements of
Operations during each of the periods ended April 1, 2010, April 2, 2009 and April 3, 2008, respectively. One of the previous holders of stock options held put rights associated
with his options deemed to be within his control whereby he could require Holdings to repurchase his options and, as a result, the expense for these options was remeasured each reporting period as
liability based options at the Holdings level and the related compensation expense was included in AMCE's financial statements. However, since the put option that caused liability classification was a
put to AMCE's parent Holdings rather than AMCE, AMCE's financial statements reflect an increase to additional paid-in capital related to stock-based compensation of $1,384,000, $2,622,000
and $207,000 during each of the periods ended April 1, 2010, April 2, 2009 and April 3, 2008, respectively. For the option awards classified as liabilities by Holdings, the
Company revalued the options at each period end following the grant date using the Black-Scholes model. In valuing this liability, Holdings used a fair value of common stock of $1,000 per share, which
was based on a contemporaneous valuation reflecting market conditions as of April 3, 2008. In May 2008, Holdings was notified of the holder's intention to exercise the put option and Holdings
made cash payments to settle the accrued liability of $3,911,000 during fiscal 2009. As a result of the exercise of the put right, there was no additional stock compensation expense related to these
options in fiscal 2009 and the related options were canceled upon exercise of the put right during fiscal 2009.

The
Company accounts for stock options using the fair value method of accounting and has valued the May 28, 2009 option grants using the Black-Scholes formula which included a
valuation prepared by management on behalf of the Compensation Committee of the Board of Directors. This reflected market conditions as of May 28, 2009 which indicated a fair value price per
share of the underlying shares of $339.59 per share, a purchase of 2,542 shares by Parent for $323.95 per share from the Company's former Chief Executive Officer pursuant to his Separation and General
Release Agreement dated February 23, 2009 and a sale of 385.862 shares by Parent to the Company's current Chief Executive Officer pursuant to his Employment Agreement dated February 23,
2009 for $323.95 per share. See Note 1The Company and Significant Accounting Policies, Stock-based Compensation for more information regarding Parent's stock option plan.

On
February 23, 2009, the Company entered into a Separation and General Release Agreement with Peter C. Brown (formerly Chairman of the Board, Chief Executive Officer and
President of Parent, Holdings and AMCE), whereby all outstanding vested and unvested options were voluntarily forfeited. Stock compensation expense recorded in fiscal 2009 related only to awards that
vested prior to February 23, 2009. Because all vested and unvested awards were forfeited, there is no additional compensation cost to recognize in future periods related to his awards.

84

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 8STOCKHOLDER'S EQUITY (Continued)

A
summary of stock option activity under all plans is as follows:

April 1, 2010

April 2, 2009

April 3, 2008Number
of
Shares

Weighted
Average
Exercise
Price Per
Share

Number
of
Shares

Weighted
Average
Exercise
Price Per
Share

Number
of
Shares

Weighted
Average
Exercise
Price Per
ShareOutstanding at beginning of year


26,811.1680905

$
391.43


36,521.356392

$
491.00


39,476.72873

$
491.00Granted(1)


4,786.00000


339.59


15,980.45000


323.95





Forfeited








(25,690.6383015
)




(2,455.372338
)Exercised














(500.00000
)

Outstanding at end of year and expected to vest(1)(2)


31,597.1680905

$
383.58


26,811.1680905

$
391.43


36,521.356392

$
491.00Exercisable at end of year(3)


14,026.8080901

$
452.94


8,784.574472

$
491.00


25,681.40958

$
491.00Available for grant at end of year


9,325.7042495





14,111.7042495





12,086.090418


(1)The
weighted average remaining contractual life for outstanding options was 7.6 years, 8.3 years, and 5.1 years for fiscal 2010, 2009
and 2008, respectively.(2)The
aggregate estimated intrinsic value for these options was $11,400,000 as of April 1, 2010.(3)The
aggregate estimated intrinsic value for these options was $4,100,000 as of April 1, 2010.


For
options exercised, intrinsic value is calculated as the difference between the market price on the date of exercise (determined using the most recent contemporaneous valuation prior
to the exercise) and the exercise price of the options. The total intrinsic value of options exercised was $412,000 during fiscal 2008 and there were no options exercised during fiscal 2009 and 2010.
Parent received cash from the exercise of stock options during fiscal 2008 of $500,000 and a related tax deduction of $164,800.

85

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 9INCOME TAXES

Income tax provision reflected in the Consolidated Statements of Operations for the periods in the three years ended April 1, 2010 consists of the following components:

(In thousands)

April 1, 2010

April 2, 2009

April 3, 2008Current:Federal

$
(2,800
)
$


$
800Foreign





13,200


6,200State


500


3,500


3,600Total current


(2,300
)

16,700


10,600Deferred:Federal


(66,500
)




(4,600
)Foreign





(1,900
)

2,500State





2,300


(700
)Total deferred


(66,500
)

400


(2,800
)Total provision (benefit)


(68,800
)

17,100


7,800Tax benefit from discontinued operations





(11,300
)

(6,780
)Total provision (benefit) from continuing operations

$
(68,800
)
$
5,800

$
1,020


Holdings
has recorded no alternative minimum taxes as the consolidated tax group for which Holdings is a member expects no alternative minimum tax liability and pursuant to the tax
sharing arrangement in place, Holdings has no liability.

Pre-tax
income (losses) consisted of the following:

(In thousands)

April 1, 2010

April 2, 2009

April 3, 2008Domestic

$
(21,396
)
$
(101,066
)
$
22,091Foreign


(7,750
)

7,008


8,442Total

$
(29,146
)
$
(94,058
)
$
30,533


86

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 9INCOME TAXES (Continued)

The
difference between the effective tax rate on earnings (loss) from continuing operations before income taxes and the U.S. federal income tax statutory rate is as follows:

(In thousands)

April 1, 2010

April 2, 2009

April 3, 2008Income tax expense (benefit) at the federal statutory rate


(7,564
)

(40,280
)

7,683Effect of:Foreign rate differential








1,990State income taxes


500


5,800


2,896Change in ASC 740 (formerly FIN 48) reserve


1,000


(5,421
)

(5,373
)Permanent items


(540
)




Change in ASC 740 (formerly APB 23) assertion





401


(6,220
)Valuation allowance


(62,218
)

45,111


(970
)Other, net


22


189


1,014Income tax expense (benefit)


(68,800
)

5,800


1,020Effective income tax rate


318.3
%

(5.0
)%

4.6
%


The
fiscal 2008 change in ASC 740 assertion relates to a resolution reached in fiscal 2008 on a pre-filing agreement with a taxing authority which resulted in additional
basis which was deducted on the 2007 tax return. The deduction was the result of a 2007 change in ASC 740 assertion. As a result of the additional basis, the Company did not have to utilize certain
net operating loss carryforwards.

87

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 9INCOME TAXES (Continued)

The
significant components of deferred income tax assets and liabilities as of April 1, 2010 and April 2, 2009 are as follows:

April 1, 2010

April 2, 2009Deferred Income Tax

Deferred Income Tax(In thousands)

Assets

Liabilities

Assets

LiabilitiesProperty

$


$
(1,948
)
$
32,130

$
Investments in joint ventures





(57,109
)




(50,709
)Intangible assets





(29,017
)




(24,234
)Pension postretirement and deferred compensation


19,150





17,260


Accrued reserves and liabilities


21,588





23,653


Deferred interest


25,660





25,660


Deferred revenue


113,667





116,882


Deferred rents


100,560





100,343


Alternative minimum tax and other credit carryovers


13,058





15,265


Charitable contributions


1,198








Net operating loss carryforward


200,228





103,273


Total

$
495,109

$
(88,074
)
$
434,466

$
(74,943
)Less: Valuation allowance


(302,535
)




(321,523
)

Total deferred income taxes(1)

$
192,574

$
(88,074
)
$
112,943

$
(74,943
)


(1)See
Note 6Supplemental Balance Sheet Information for additional disclosures about net current deferred tax assets and net
non-current deferred tax liabilities.


A
rollforward of the Company's valuation allowance for deferred tax assets is as follows:

(In thousands)

Balance at
Beginning of
Period

Additions
Charged
(Credited) to
Revenues,
Costs and
Expenses

Charged
(Credited) to
Other
Accounts

Deductions
and
Write-offs

Balance at
End of
PeriodFiscal Year 2010Valuation Allowance-deferred income tax assets

$
321,523


(62,218
)

43,230
(1)



$
302,535Fiscal Year 2009Valuation Allowance-deferred income tax assets

$
379,081


45,111


(50,529)
(1)

(52,140)
(2)
$
321,523Fiscal Year 2008Valuation Allowance-deferred income tax assets

$
383,808


(970
)

(3,757)
(1)



$
379,081


(1)Intercompany
tax sharing agreement, goodwill, and other comprehensive income adjustments in stockholder's equity.(2)Elimination
of Cinemex deferred tax asset and change in valuation allowance through discontinued operations.


88

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 9INCOME TAXES (Continued)




The
Company's federal income tax loss carryforward of $438,702,000 will begin to expire in 2020 and will completely expire in 2030 and will be limited annually due to
certain change in ownership provisions of the Internal Revenue Code. The Company also has state income tax loss carryforwards of $874,317,000 which may be used over various periods ranging from 1 to
20 years.

Parent
completed the repurchase of certain term loans under the Parent term Loan Facility in fiscal 2010. Based upon the historical tax sharing arrangement, Parent should utilize the
Company's net operating losses in future years. During fiscal 2010, the Company reversed $1,500,000 of its valuation allowance through the income statement in anticipation of future utilization by
Parent. As of April 2,
2009, the Company reversed $31,000,000 of its valuation allowance through Goodwill in anticipation of future utilization by Parent.

During
fiscal 2010, management believed it was more likely than not that the Company had the ability to execute a feasible and prudent tax strategy that would provide for the realization
of net operating losses that expire through 2022 by converting certain limited partnership units into common stock. Management has reduced its overall valuation allowance by $65,000,000 in fiscal 2010
for the estimated amount of net operating losses that would be realized as a result of this potential action.

The
Company has recorded a valuation allowance against its remaining net deferred tax asset in U.S. and foreign jurisdictions of $302,535,000 as of April 1, 2010.

Effective
March 30, 2007, the Company adopted accounting rules regarding uncertainty in income taxes. Relative to the implementation of this guidance, the Company's financial
statements did not include any tax contingencies, after consideration of the partial/full valuation allowance recorded against net deferred tax assets. As a result of the adoption of this guidance,
the Company recorded a $5,373,000 increase in current deferred tax assets, a $5,373,000 reduction of goodwill, a $5,373,000 current liability and a $5,373,000 charge to the beginning accumulated
deficit that is reported as a cumulative effect adjustment for a change in accounting principle to the opening balance sheet position of stockholder's accumulated deficit at March 30, 2007. A
reconciliation of the change in the amount of unrecognized tax benefits during the year ended April 1, 2010 was as follows:

(In millions)

April 1, 2010

April 2, 2009

April 3, 2008Balance at Beginning of Period

$
33.5

$
38.7

$
44.1Gross IncreasesCurrent Period Tax Positions


1.5


1.5


Gross DecreasesTax Position in Prior Periods


(.5
)

(2.1
)

Favorable Resolutions with Authorities








(5.4
)Expired Attributes








Lapse of Statute of Limitations





(4.6
)

Cash Settlements








Balance at End of Period

$
34.5

$
33.5

$
38.7


As
of April 1, 2010, the Company recognized a $7,000,000 liability for uncertain tax positions and a $7,000,000 deferred tax asset for net operating losses on the balance sheet.
These uncertain positions

89

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 9INCOME TAXES (Continued)

were
taken in tax years where the Company generated positive taxable income and they were previously netted against deferred tax assets on the balance sheet.

The
Company's effective tax rate would not be significantly impacted by the ultimate resolution of the uncertain tax positions because of the retention of a valuation allowance against
its net operating loss carryforwards.

During
December 2007, the IRS informed the Company of its acceptance of certain tax conclusions that the Company had taken on a transaction the Company entered into during the fiscal
year ended March 29, 2007 that were presented to the IRS in a Request for a Pre-Filing Agreement. As a result of the IRS accepting the Company's tax conclusions, the $5,373,000
reserve established with the adoption of the income tax uncertainty guidance was resolved and the tax benefit was recorded during the fiscal year ended April 3, 2008.

The
Company recognizes income tax-related interest expense and penalties as income tax expense and general, and administrative expense, respectively. As of April 3,
2008, the Company did not have any interest or penalties accrued associated with unrecognized tax benefits. The liabilities for interest and penalties increased by $101,000 and $45,000, as of
April 1, 2010 and April 2, 2009, respectively.

There
are currently unrecognized tax benefits which the Company anticipates will be resolved in the next 12 months; however, the Company is unable at this time to estimate what
the impact on its unrecognized tax benefits will be.

The
Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various state and foreign jurisdictions. An IRS examination of the tax years
February 28, 2002 through December 31, 2003 of the former Loews Cineplex Entertainment Corporation and subsidiaries was
concluded during fiscal 2007. An IRS examination for the tax years ended March 31, 2005 and March 30, 2006 was completed during 2009. Generally, tax years beginning after
March 28, 2002 are still open to examination by various taxing authorities. Additionally, the Company has net operating loss ("NOL") carryforwards for tax years ended
October 31, 2000 through March 28, 2002 in the U.S. and various state jurisdictions which have carryforwards of varying lengths of time. These NOLs are subject to adjustment based on the
statute of limitations of the return in which they are utilized, not the year in which they are generated. Various state, local and foreign income tax returns are also under examination by taxing
authorities. The Company does not believe that the outcome of any examination will have a material impact on its financial statements.

NOTE 10LEASES

Beginning in fiscal 1998, the Company has completed numerous real estate lease agreements with Entertainment Properties Trust ("EPT") including transactions accounted for as sale and
leaseback transactions in accordance with Accounting Standards Codification No. 840,Leases. The leases are triple net leases that require the
Company to pay substantially all expenses associated with the operation of the theatres such as taxes and other charges, insurance, utilities, service, maintenance and any ground lease payments. As of
April 1, 2010, the Company leased from EPT 42 theatres with 924 screens located in the United States and Canada.

90

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 10LEASES (Continued)

Following
is a schedule, by year, of future minimum rental payments required under existing operating leases that have initial or remaining non-cancelable terms in excess of
one year as of April 1, 2010:

(In thousands)

Minimum operating
lease payments2011

$
390,5582012


392,3172013


380,2242014


353,5352015


350,352Thereafter


2,016,646Total minimum payments required

$
3,883,632


As
of April 1, 2010, the Company has a lease agreement for one theatre with 12 screens which is expected to begin construction in fiscal 2011 and open in fiscal 2012. Included
above are equipment leases payable to DCIP.

Included
in other long-term liabilities as of April 1, 2010 and April 2, 2009 is $226,061,000 and $225,957,000, respectively, of deferred rent representing
future minimum rental payments for leases with scheduled rent increases and unfavorable lease liabilities.

Rent
expense is summarized as follows:

(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

53 Weeks
Ended
April 3, 2008Minimum rentals

$
391,493

$
398,289

$
387,449Common area expenses


41,189


43,409


44,667Percentage rentals based on revenues


7,982


7,105


7,273Theatre rent


440,664


448,803


439,389General and administrative and other


1,427


1,227


1,463Total

$
442,091

$
450,030

$
440,852


NOTE 11EMPLOYEE BENEFIT PLANS

The Company sponsors frozen non-contributory qualified and non-qualified defined benefit pension plans generally covering all employees who, prior to the freeze,
were age 21 or older and had completed at least 1,000 hours of service in their first twelve months of employment, or in a calendar year ending thereafter, and who were not covered by a
collective bargaining agreement. The Company also offers eligible retirees the opportunity to participate in a health plan (medical and dental). Certain employees are eligible for subsidized
postretirement medical benefits. The eligibility for these benefits is based upon a participant's age and service as of January 1, 2009. The Company also sponsors a postretirement deferred
compensation plan.

91

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 11EMPLOYEE BENEFIT PLANS (Continued)

In
the fourth quarter of fiscal 2009, the Company recorded a curtailment gain of $1,072,000 as a result of the retirement of its former chief executive officer on February 23,
2009. The curtailment gain relates to the Retirement Enhancement Plan which included only one active unvested participant and one retired vested participant. Because the former chief executive officer
had not vested in his eligible benefit, his retirement created a significant elimination of the accrual of deferred benefits for his future services.

On
May 2, 2008, the Company's Board of Directors approved revisions to the Company's Post Retirement Medical and Life Insurance Plan effective January 1, 2009 and on
July 3, 2008 the changes were communicated to the plan participants. As a result of these revisions, the Company recorded a
negative prior service cost of $5,969,000 through other comprehensive income to be amortized over eleven years based on expected future service of the remaining participants.

Effective
March 29, 2007, the Company adopted the amended guidance for employers' accounting for defined benefit pension and other postretirement plans in ASC 715, Compensation-Retirement Benefits, ("ASC
715"). ASC 715 requires that, effective for fiscal years ending after December 15, 2008 the assumptions
used to measure annual pension and retiree medical expense be determined as of the balance sheet date and all plan assets and liabilities be reported as of that date. Accordingly, as of the beginning
of fiscal 2009, the Company changed the measurement date for the annual pension and postretirement medical expense and all plan assets and liabilities by applying the transition option under which a
15 month measurement was determined as of January 1, 2008, that covers the period to the Company's year-end balance sheet date. As a result of this change in measurement
date, the Company recorded an $82,000 loss to fiscal 2009 opening accumulated deficit and a $411,000 unrealized loss to other comprehensive income.

As
a result of the Merger in January 2006, the Company acquired two pension plans in the U.S. and one in Mexico. One of the U.S. plans is a frozen cash balance plan and neither of the
U.S. plans has admitted new participants post-merger. On December 29, 2008, the Company sold all of its interests in Cinemex, which includes the Mexico Plan. See
Note 2Discontinued Operations for more information.

On
November 7, 2006, the Company's Board of Directors approved an amendment to freeze the Company's Defined Benefit Retirement Income Plan, Supplemental Executive Retirement Plan
and Retirement Enhancement Plan (the "Plans") as of December 31, 2006. On December 20, 2006 the Company amended and restated the Plans to implement the freeze as of December 31,
2006. As a result of the freeze there will be no further benefits accrued after December 31, 2006, but continued vesting for associates with less than five years of vesting service. The Company
will continue to fund existing benefit obligations and there will be no new participants in the future. As a result of amending and restating the Plans to implement the freeze, the Company recognized
a curtailment gain of $10,983,000 in fiscal 2007 in its consolidated financial statements which was recorded within general and administrative: other. Additionally, the Company terminated the LCE
post-retirement plan as of December 31, 2006 and merged this plan into the AMCE post-retirement plan as of January 1, 2007.

The
measurement date used to determine pension and other postretirement benefits is April 1, 2010.

92

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 11EMPLOYEE BENEFIT PLANS (Continued)

Net periodic benefit cost for the plans consists of the following:

Pension Benefits

Other Benefits(In thousands)

52 Weeks
Ended
April 1,
2010

52 Weeks
Ended
April 2,
2009

53 Weeks
Ended
April 3,
2008

52 Weeks
Ended
April 1,
2010

52 Weeks
Ended
April 2,
2009

53 Weeks
Ended
April 3,
2008Components of net periodic Benefit cost:Service cost

$
180

$
369

$
443

$
210

$
402

$
846Interest cost


4,403


4,468


4,440


1,296


1,111


1,555Expected return on plan assets


(2,990
)

(5,098
)

(4,691
)







Amortization of prior service credit











(543
)

(407
)

Amortization of net transition obligation





28


39








Amortization of net (gain) loss


134


(1,622
)

(1,115
)

(278
)

(69
)

Settlement








(56
)







Curtailment





(1,072
)










Net periodic benefit cost

$
1,727

$
(2,927
)
$
(940
)
$
685

$
1,037

$
2,401


The
following table summarizes the changes in other comprehensive income:

Pension Benefits

Other Benefits(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009Net (gain) loss

$
4,224

$
16,086

$
7,315

$
(3,604
)Net prior service credit








(3,727
)

(5,969
)Amortization of net gain (loss)


(134
)

1,622


543


69Amortization of prior service credit








278


407Amortization of net transition obligation





(28
)




Impact of changing measurement date





411





Disposition of Cinemex





(877
)




Total recognized in other comprehensive income

$
4,090

$
17,214

$
4,409

$
(9,097
)Net periodic benefit cost


1,727


(2,927
)

685


1,037Total recognized in net periodic benefit cost and other comprehensive income

$
5,817

$
14,287

$
5,094

$
(8,060
)


93

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 11EMPLOYEE BENEFIT PLANS (Continued)

The
following tables set forth the plan's change in benefit obligations and plan assets and the accrued liability for benefit costs included in the consolidated balance sheets:

Pension Benefits

Other Benefits(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009Change in benefit obligation:Benefit obligation at beginning of period

$
60,690

$
73,330

$
18,101

$
26,830Service cost


180


414


210


632Interest cost


4,403


5,604


1,296


1,727Plan participant's contributions








417


447Actuarial (gain) loss


13,694


(12,017
)

7,315


(3,604
)Plan amendment








(3,727
)

(5,969
)Benefits paid


(2,526
)

(4,638
)

(1,628
)

(1,962
)Disposition of Cinemex





(1,468
)




Currency translation adjustment





(535
)




Benefit obligation at end of period

$
76,441

$
60,690

$
21,984

$
18,101




Pension Benefits

Other Benefits(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009Change in plan assets:Fair value of plan assets at beginning of period

$
39,600

$
62,114

$


$
Actual return on plan assets gain (loss)


12,461


(20,623
)




Employer contribution


4,922


2,747


1,211


1,515Plan participant's contributions








417


447Benefits paid


(2,526
)

(4,638
)

(1,628
)

(1,962
)Fair value of plan assets at end of period

$
54,457

$
39,600

$


$
Net liability for benefit cost:Funded status

$
(21,984
)
$
(21,090
)
$
(21,984
)
$
(18,101
)




Pension Benefits

Other Benefits(In thousands)

April 1, 2010

April 2, 2009

April 1, 2010

April 2, 2009Amounts recognized in the Balance Sheet:Accrued expenses and other liabilities

$
(192
)
$
(249
)
$
(1,231
)
$
(1,300
)Other long-term liabilities


(21,792
)

(20,841
)

(20,753
)

(16,801
)Net liability recognized

$
(21,984
)
$
(21,090
)
$
(21,984
)
$
(18,101
)Aggregate accumulated benefit obligation

$
(76,441
)
$
(60,690
)
$
(21,984
)
$
(18,101
)


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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 11EMPLOYEE BENEFIT PLANS (Continued)

The
following table summarizes pension plans with accumulated benefit obligations and projected benefit obligations in excess of plan assets:

Pension Benefits(In thousands)

April 1, 2010

April 2, 2009Aggregated accumulated benefit obligation

$
(75,997
)
$
(60,690
)Aggregated projected benefit obligation


(75,997
)

(60,690
)Aggregated fair value of plan assets


53,977


39,600


Amounts
recognized in accumulated other comprehensive income consist of the following:

Pension Benefits

Other Benefits(In thousands)

April 1, 2010

April 2, 2009

April 1, 2010

April 2, 2009Net actuarial (gain) loss

$
5,393

$
1,303

$
1,607

$
(5,986
)Prior service credit








(8,746
)

(5,562
)


Amounts
in accumulated other comprehensive income (loss) expected to be recognized in components of net periodic pension cost in fiscal 2011 are as follows:

(In thousands)

Pension Benefits

Other BenefitsNet actuarial loss

$
174

$
Prior service credit





(865
)Total

$
174

$
(865
)


Actuarial Assumptions

The weighted-average assumptions used to determine benefit obligations are as follows:

Pension Benefits

Other BenefitsApril 1, 2010

April 2, 2009

April 1, 2010

April 2, 2009Discount rate


6.16
%

7.43
%

5.97
%

7.42
%Rate of compensation increase


N/A


N/A


N/A


5.00
%


The
weighted-average assumptions used to determine net periodic benefit cost are as follows:

Pension Benefits

Other Benefits52 Weeks
ended
April 1,
2010

52 Weeks
ended
April 2,
2009

53 Weeks
ended
April 3,
2008

52 Weeks
ended
April 1,
2010

52 Weeks
ended
April 2,
2009

53 Weeks
ended
April 3,
2008Discount rate


7.43
%

6.25
%

5.71
%

7.42
%

6.25
%

5.75
%Expected long-term return on plan assets


8.00
%

8.25
%

8.25
%

N/A


N/A


N/ARate of compensation increase


N/A


N/A


N/A


N/A


5.00
%

5.00
%


In
developing the expected long-term rate of return on plan assets at each measurement date, the Company considers the plan assets' historical returns, asset allocations, and
the anticipated future

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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 11EMPLOYEE BENEFIT PLANS (Continued)

economic
environment and long-term performance of the asset classes. While appropriate consideration is given to recent and historical investment performance, the assumption represents
management's best estimate of the long-term prospective return.

For
measurement purposes, the annual rate of increase in the per capita cost of covered health care benefits assumed for 2010 was 8.0% for medical and 4.0% for dental and vision. The
rates were assumed to decrease gradually to 5.0% for medical in 2017 and remain at 4.0% for dental. The health care cost trend rate assumption has a significant effect on the amounts reported.
Increasing the assumed health care cost trend rates by one percentage point in each year would increase the accumulated postretirement benefit obligation as of April 1, 2010 by $2,204,000 and
the aggregate of the service and interest cost components of postretirement expense for fiscal 2010 by $147,000. Decreasing the assumed health care cost trend rates by one percentage point in each
year would decrease the accumulated postretirement obligation for fiscal 2010 by $1,879,000 and the aggregate service and interest cost components of postretirement expense for fiscal 2010 by
$125,000. The Company's retiree health plan provides a benefit to its retirees that is at least actuarially equivalent to the benefit provided by theMedicare Prescription
Drug, Improvement and Modernization Act of 2003("Medicare Part D").

Cash Flows

The Company expects to contribute $2,559,000 to the pension plans during fiscal 2011.

The
following table provides the benefits expected to be paid (inclusive of benefits attributable to estimated future employee service) in each of the next five fiscal years, and in the
aggregate for the five fiscal years thereafter:

(In thousands)

Pension Benefits

Other Benefits
Net of Medicare
Part D Adjustments

Medicare Part D
Adjustments2011

$
2,778

$
1,231

$
772012


2,055


1,275


862013


2,272


1,298


952014


2,938


1,342


1052015


2,454


1,360


116Years 2016 - 2019


20,561


7,270


722


Pension Plan Assets

For its defined benefit pension plan investments, the Company employs a long-term risk-controlled approach
using diversified investment options with minimal exposure to volatile investment options like derivatives. The Company uses a diversified allocation of equity, debt, and real estate exposures that
are customized to the Plan's cash flow benefit needs. The target allocations for plan assets are 45 percent equity securities, 30 percent debt or fixed securities and 25 percent
real estate and other.

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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 11EMPLOYEE BENEFIT PLANS (Continued)

The fair value of the pension plan assets at April 1, 2010, by asset class are as follows:

Fair Value Measurements at April 1, 2010 Using(In thousands)

Total Carrying
Value at
April 1, 2010

Quoted prices in
active market
(Level 1)

Significant other
observable inputs
(Level 2)

Significant
unobservable inputs
(Level 3)Cash and cash equivalents

$
544

$
544

$


$
U.S. Treasury Securities


2,464


2,464





Equity securities:U.S. companies


21,734


3,595


18,139


International companies


8,686


8,686





Bond market fund


8,403


8,403





Collective trust fund


5,132


5,132





Commodities broad basket fund


1,443


1,443





High yield bond fund


2,387





2,387


Inflation-protected bond fund


788





788


Intermediate-term bond fund


1,057





1,057


Real estate(1)


1,819








1,819Total assets at fair value

$
54,457

$
30,267

$
22,371

$
1,819


(1)This
class invests mainly in commercial real estate and includes mortgage loans which are backed by the associated properties. These underlying real estate
investments have unobservable Level 3 pricing inputs. The fair values have been estimated based on independent appraisals or cash flow projections.


Fair Value Measurements Using Significant Unobservable Inputs (Level 3)(In thousands)

Real EstateBalance at April 2, 2009

$
2,283Purchases, sales, issuances, and settlements, net


36Unrealized (losses)/gains, net, relating to instruments still held at end of year


(500
)Balance at April 1, 2010

$
1,819


Defined Contribution Plan

The Company sponsors a voluntary 401(k) savings plan covering employees age 21 or older who have completed at least 1,000 hours
of service in their first twelve months of employment, or in a calendar year thereafter, and who are not covered by a collective bargaining agreement. Effective for fiscal year 2010, in the Company's
401(k) Savings Plan the Company matched 50% of each eligible employee's elective contributions up to 6% of the employee's eligible compensation. Previously, the Company matched 100% of elective
contributions up to 5% of employee compensation. The Company's expense under the 401(k) savings plan was $1,654,000, $2,374,000, and $2,476,000 for the periods ended April 1, 2010,
April 2, 2009 and April 3, 2008, respectively.

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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 11EMPLOYEE BENEFIT PLANS (Continued)

Union-Sponsored Plans

Certain theatre employees are covered by union-sponsored pension and health and welfare plans. Company contributions into these plans
are determined in accordance with
provisions of negotiated labor contracts. Contributions aggregated $501,000, $559,000, and $1,004,000, for the periods ended April 1, 2010, April 2, 2009 and April 3, 2008,
respectively. On November 7, 2008, the Company received notice of a written demand for payment of a partial withdrawal liability assessment from a collectively bargained multiemployer pension
plan that covers certain of its unionized theatre employees. Based on a payment schedule that the Company received from this plan in December 2008, the Company began making quarterly payments on
January 1, 2009 related to the $5,279,000 in partial withdrawal liability. In the second quarter of fiscal 2010, the Company made a complete withdrawal from the plan which triggered an
additional liability of $1,422,000 which was assessed by the plan on April 19, 2010. However, the Company also estimates that approximately $2,839,000 of the total liability was discharged in
bankruptcy by companies it acquired. As of April 1, 2010, the Company has recorded a liability related to this matter in the amount of $4,016,000 and has made contributions of approximately
$2,905,000. The final withdrawal liability amount may be adjusted based on a legal review of the plan's assessment, the Company's records and ensuing discussions with the plan's trustees. The Company
estimates its potential complete withdrawal liability from its other multiemployer pension plans is approximately $3,000,000 to $3,500,000.

NOTE 12COMMITMENTS AND CONTINGENCIES

The Company, in the normal course of business, is party to various legal actions. Except as described below, management believes that the potential exposure, if any, from such matters
would not have a material adverse effect on the financial condition, cash flows or results of operations of the Company.

United States of America v. AMC Entertainment Inc. and American Multi Cinema, Inc.(No. 99 01034 FMC (SHx), filed in
the U.S. District Court for the Central District of California). On January 29, 1999, the Department of Justice (the "Department") filed suit alleging that AMCE's stadium style theatres
violated the ADA and related regulations. The Department alleged that AMCE had failed to provide persons in wheelchairs seating arrangements with lines-of-sight comparable to
the general public. The Department alleged various non-line-of-sight violations as well. The Department sought declaratory and injunctive relief regarding existing
and future theatres with stadium-style seating, compensatory damages in the approximate amount of $75,000 and a civil penalty of $110,000.

As
to line-of-sight matters, the trial court entered summary judgment in favor of the Justice Department as to both liability and as to the appropriate remedy. On
December 5, 2008, the Ninth Circuit Court of Appeals reversed the trial court as to the appropriate remedy and remanded the case back to the trial court for findings consistent with its
decision. AMCE and the Department are negotiating the extent of betterments related to the remaining remedies required for line-of-sight violations consistent with the Ninth
Circuit's decision. The improvements will likely be made over a five-year term. Absent settlement, the case will be tried in February 2011. AMCE has recorded a liability of approximately $349,000 for
estimated fines related to this matter.

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 12COMMITMENTS AND CONTINGENCIES (Continued)

As
to the non-line-of-sight aspects of the case, on January 21, 2003, the trial court entered summary judgment in favor of the Department on
matters such as parking areas, signage, ramps, location of toilets, counter heights, ramp slopes, companion seating and the location and size of handrails. On December 5, 2003, the trial court
entered a consent order and final judgment on non-line-of-sight issues under which AMCE agreed to remedy certain violations at its stadium-style theatres and at
certain theatres it may open in the future. Currently AMCE estimates that these betterments will be required at approximately 140 stadium-style theatres. AMCE estimates that the total cost of these
betterments will be approximately $54,000,000, and through April 1, 2010 AMCE has incurred approximately $33,355,000 of these costs. The estimate is based on actual costs incurred on
remediation work completed to date. The actual costs of betterments may vary based on the results of surveys of the remaining theatres.

Michael Bateman v. American Multi-Cinema, Inc.(No. CV07-00171). In January 2007, a class action complaint was filed
against the Company in the Central District of the United States District Court of California (the "District Court") alleging violations of the Fair and Accurate Credit Transactions Act ("FACTA").
FACTA provides in part that neither expiration dates nor more than the last five numbers of a credit or debit card may be printed on receipts given to customers. FACTA imposes significant penalties
upon violators where the violation is deemed to have been willful. Otherwise damages are limited to actual losses incurred by the card holder. On October 24, 2008, the District Court denied
plaintiff's renewed motion for class certification. Plaintiff has appealed this decision and the case is stayed pending this appeal.

On
May 14, 2009, Harout Jarchafjian filed a similar lawsuit alleging that the Company willfully violated FACTA and seeking statutory damages, but without alleging any actual
injury (Jarchafjian v. American Multi-Cinema, Inc.(C.D. Cal. Case No. CV09-03434). The Jarchafjian case has been deemed related to
the Bateman case and is stayed pending a Ninth Circuit decision in the Bateman case. The Company believes the plaintiff's allegations in both these cases, particularly those asserting AMC's
willfulness, are without merit.

In
addition to the cases noted above, the Company is also currently a party to various ordinary course claims from vendors (including concession suppliers, software technology vendors,
and motion picture distributors), landlords and suppliers and other legal proceedings. If management believes that a loss arising from these actions is probable and can reasonably be estimated, the
Company records the amount of the loss, or the minimum estimated liability when the loss is estimated using a range and no point is more probable than another. As additional information becomes
available, any potential liability related to these actions is assessed and the estimates are revised, if necessary. Except as described above, management believes that the ultimate outcome of such
other matters, individually and in the aggregate, will not have a material adverse effect on the Company's financial position or overall trends in results of operations. However, litigation and claims
are subject to inherent uncertainties and unfavorable outcomes could occur. An unfavorable outcome could include monetary damages. If an unfavorable outcome were to occur, there exists the possibility
of a material adverse impact on the results of operations in the period in which the outcome occurs or in future periods.

Kerasotes Acquisition.On December 9, 2009, the Company entered into a definitve agreement with Kerasotes ShowPlace Theatres,
 LLC
("Kerasotes") pursuant to which the Company will acquire substantially all of the assets of Kerasotes. Kerasotes operated 95 theatres and 972 screens in mid-sized,

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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 12COMMITMENTS AND CONTINGENCIES (Continued)

suburban
and metropolitan markets, primarily in the Midwest. On May 24, 2010, the Company completed the acquisition. The purchase price for the Kerasotes theatres paid in cash at closing was
$275,000,000 and is subject to working capital and other purchase price adjustments as described in the Unit Purchase Agreement. In connection with the consummation of the acquisition, the Company
sold one of its theatres for a gain on sale of approximately $10,000,000.

NOTE 13THEATRE AND OTHER CLOSURE AND DISPOSITION OF ASSETS

The Company has provided reserves for estimated losses from theatres which have been closed. As of April 1, 2010, the Company has reserved $6,694,000 for lease terminations which
have either not been consummated or paid, related primarily to two theatres and vacant restaurant space. In connection with the Loews Merger, the Company accrued $4,845,000 for future lease
obligations at facilities that had been closed or were duplicate facilities that were planned to be closed following the Merger. The accrual was primarily related to the New York City home office
lease, which has been fully paid in fiscal 2008. The Company is obligated under long-term lease commitments with remaining terms of up to 18 years for theatres which have been
closed. As of April 1, 2010, base rents aggregated approximately $831,000 annually and $8,451,000 over the remaining terms of the leases.

A
rollforward of reserves for theatre and other closure is as follows:

Fifty-two Week Period

Fifty-two Week Period

Fifty-three Week PeriodApril 1, 2010

April 2, 2009

April 3, 2008(In thousands)

Theatre
and
Other

Merger
Exit
Costs

Total

Theatre
and
Other

Merger
Exit
Costs

Total

Theatre
and
Other

Merger
Exit
Costs

TotalBeginning balance

$
7,386

$


$
7,386

$
10,844

$


$
10,844

$
17,621

$
1,274

$
18,895Theatre and other closure (income) expense


2,573





2,573


(2,262
)




(2,262
)

(20,677
)

(293
)

(20,970
)Transfer of property tax liability


715





715


63





63


424





424Transfer of deferred rent and capital lease obligations


2,112





2,112


2,828





2,828


10,514





10,514Cash (payments) receipts, net


(6,092
)




(6,092
)

(4,087
)




(4,087
)

2,962


(981
)

1,981Ending balance

$
6,694

$


$
6,694

$
7,386

$


$
7,386

$
10,844

$


$
10,844


During
the fifty-two weeks ended April 1, 2010, the Company recognized $2,573,000 of theatre and other closure expense due primarily to closure of one theatre and
accretion of the closure liability related to theatres closed during prior periods. During the fifty-two weeks ended April 2, 2009, the Company recognized $2,262,000 of theatre and
other closure income due primarily to lease terminations negotiated on favorable terms for two theatres that were closed during this period. The Company did not receive cash payments in connection
with the lease terminations, but recognized income from the write-off of the unamortized deferred rent liability. During the fifty-three weeks ended

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 13THEATRE AND OTHER CLOSURE AND DISPOSITION OF ASSETS (Continued)

April 3,
2008, the Company recognized $20,970,000 of theatre and other closure income due primarily to lease terminations negotiated on favorable terms at seven of its theatres that were either
closed or the lease terms were settled favorably during this period. The Company received net cash payments of $10,159,000 in connection with these seven lease terminations.

Theatre
and other closure reserves for leases that have not been terminated are recorded at the present value of the future contractual commitments for the base rents, taxes and
maintenance. As of April 1, 2010, the future lease obligations are discounted at annual rates ranging from 7.55% to 8.54%.

NOTE 14FAIR VALUE MEASUREMENTS

Fair value refers to the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the
entity transacts. The inputs used to develop these fair value measurements are established in a hierarchy, which ranks the quality and reliability of the information used to determine the fair values.
The fair value classification is based on levels of inputs. Assets and liabilities that are carried at fair value are classified and disclosed in one of the following categories:

Level 1:

Quoted market prices in active markets for identical assets or liabilities.Level 2:

Observable market based inputs or unobservable inputs that are corroborated by market data.Level 3:

Unobservable inputs that are not corroborated by market data.


The
following table summarizes the fair value hierarchy of the Company's financial assets and liabilities carried at fair value on a recurring basis as of April 1, 2010:

Fair Value Measurements at April 1, 2010 Using(In thousands)

Total Carrying
Value at
April 1, 2010

Quoted prices in
active market
(Level 1)

Significant other
observable inputs
(Level 2)

Significant
unobservable inputs
(Level 3)Assets:Money Market Mutual Funds

$
22,587

$
22,587

$


$
Equity securities, available-for-sale:Mutual Fund International


2,586


2,586





Mutual Fund Large U.S. Equity


111


111





Mutual Fund Small/Mid U.S. Equity


187


187





Mutual Fund Other Equity


19


19





Mutual Fund Fixed Income


283


283





Total assets at fair value

$
25,773

$
25,773

$


$
Liabilities:











Total liabilities at fair value

$


$


$


$



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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 14FAIR VALUE MEASUREMENTS (Continued)

The
following table summarizes the fair value hierarchy of the Company's financial assets and liabilities carried at fair value on a recurring basis as of April 2, 2009:

Fair Value Measurements at April 2, 2009 Using(In thousands)

Total Carrying
Value at
April 2, 2009

Quoted prices in
active market
(Level 1)

Significant other
observable inputs
(Level 2)

Significant
unobservable inputs
(Level 3)Assets:Money Market Mutual Funds

$
377,993

$
377,993

$


$
Equity securities, available-for-sale:Mutual Fund International


2,214


2,214





Mutual Fund Large U.S. Equity


164


164





Mutual Fund Small/Mid U.S. Equity


181


181





Mutual Fund Other Equity


12


12





Mutual Fund Fixed Income


291


291





Total assets at fair value

$
380,855

$
380,855

$


$
Liabilities:Interest rate swap agreements


552





552


Total liabilities at fair value

$
552

$


$
552

$



Valuation Techniques.The Company's cash and cash equivalents are primarily money market mutual funds invested in funds that seek to
preserve
principal, are highly liquid, and therefore are recorded on the balance sheet at the principal amounts deposited, which equals fair value. The equity securities primarily consist of mutual funds
invested in equity, fixed income, and international funds. The equity securities are measured at fair value using quoted market prices and are classified within Level 1 of the
valuation hierarchy. The amortized cost basis of the equity securities held as of April 1, 2010 is $2,765,000.

The
Company is required to disclose the fair value of financial instruments that are not recognized in the statement of financial position, for which it is practicable to estimate that
value. At April 1, 2010, the carrying amount of the Company's liabilities for corporate borrowings was approximately $2,073,649,000 and the fair value was approximately $2,146,362,000. At
April 2, 2009, the carrying amount of the corporate borrowings was approximately $1,928,736,000 and the fair value was approximately $1,699,681,000. Quoted market prices were used to value
publicly held corporate borrowings. The carrying value of cash and equivalents approximates fair value because of the short duration of those instruments.

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 14FAIR VALUE MEASUREMENTS (Continued)

The
following table summarizes the fair value hierarchy of the Company's assets that were measured at fair value on a nonrecurring basis:

Fair Value Measurements at April 1, 2010 Using(In thousands)

Total
Carrying
Value at
April 1, 2010

Quoted prices in
active market
(Level 1)

Significant
other
observable
inputs (Level 2)

Significant
unobservable
inputs
(Level 3)

Total LossesLong-lived assets held and used

$
10,335

$


$


$
10,335

$
3,765


In
accordance with the provisions of the impairment of long-lived assets subsections of FASB Codification Subtopic 360-10, long-lived assets held and
used were written down to their fair value of $10,335,000, resulting in an impairment charge of $3,765,000, which was included in earnings for the fifty-two weeks ending April 1,
2010.

The
fair value of assets is determined as either the expected selling price less selling costs (where appropriate) or the present value of the estimated future cash flows. The fair value
of furniture, fixtures and equipment has been determined using similar asset sales and in some instances with the assistance of third party valuation studies. The discount rate used in determining the
present value of the estimated future cash flows was based on management's expected return on assets during fiscal 2010.

NOTE 15OPERATING SEGMENT

The Company reports information about operating segments in accordance with ASC 280-10,Segment Reporting, which requires
financial information to be reported based on the way management organizes segments within a company for making operating decisions and evaluating performance. The Company has identified one
reportable segment for its theatrical exhibition operations. Prior to fiscal 2009, the Company had three operating segments which consisted of United States and Canada Theatrical Exhibition,
International Theatrical Exhibition, and Other. The reduction in the number of operating segments was a result of the disposition of Cinemex in December 2008. Cinemex was previously reported in the
International Theatrical Exhibition operating segment and accounted for a substantial majority of that segment. In addition, in the second quarter of fiscal 2009, the Company consolidated the Other
operating segment with the United States and Canada Theatrical Exhibition operating segment due to a previous contribution of advertising net assets to NCM. During fiscal 2009, the United States and
Canada Theatrical Exhibition operating segment was renamed the Theatrical Exhibition operating segment.

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Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 15OPERATING SEGMENT (Continued)

Information
about the Company's revenues and assets by geographic area is as follows:

Revenues (In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

53 Weeks
Ended
April 3, 2008United States

$
2,328,069

$
2,184,686

$
2,254,399Canada


70,260


61,830


56,581France


5,979


5,015


6,100United Kingdom


13,431


13,956


15,964Total revenues

$
2,417,739

$
2,265,487

$
2,333,044




Long-term assets, net (In thousands)

April 1, 2010

April 2, 2009United States

$
3,083,269

$
3,105,613Canada


2,891


3,209France


70


724United Kingdom


568


307Total long-term assets(1)

$
3,086,798

$
3,109,853


(1)Long-term
assets are comprised of property, intangible assets, goodwill and other long-term assets.


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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 16RELATED PARTY TRANSACTIONS

Governance Agreements

Agreements entered into by AMC Entertainment Holdings, Inc., the Sponsors and Holdings' other stockholders (collectively, the
"Governance Agreements"), provide that the Board of Directors for Parent consist of up to nine directors, two of whom are designated by JPMP, two of whom are designated by Apollo, one of whom is the
Chief Executive Officer of Parent, one of whom is designated by Carlyle, one of whom is designated by Bain, one of whom is designated by Spectrum and one of whom is designated by Bain, Carlyle and
Spectrum, voting together, so long as such designee was consented to by each of Bain and Carlyle. Each of the directors respectively designated by JPMP, Apollo, Carlyle, Bain and Spectrum have three
votes on all matters placed before the Board of Directors of Holdings and AMCE and the Chief Executive Officer of Parent and the director designated by Carlyle, Bain and Spectrum voting together have
one vote each. The number of directors respectively designated by the Sponsors is to be reduced upon a decrease in such Sponsors' ownership in Parent below certain thresholds.

The
Voting Agreement among Parent and the pre-existing stockholders of Holdings provides that, until the fifth anniversary of the Mergers (the "Blockout Period"), the former
continuing stockholders of Holdings (other than Apollo and JPMP) would generally vote their voting shares of capital stock of Parent in favor of any matter in proportion to the shares of capital stock
of Apollo and JPMP voted in favor of such matter, except in certain specified instances. The Voting Agreement among Parent and the former stockholders of LCE Holdings further provides that during the
Blockout Period, the former LCE Holdings stockholders would generally vote their voting shares of capital stock of Parent on any matter as directed by any two of Carlyle, Bain and Spectrum, except in
certain specified instances. In addition, certain actions of Parent, including, but not limited to, change in control transactions, acquisition or disposition transactions with a value in excess of
$10,000,000, the settlement of claims or litigation in excess of $2,500,000, an initial public offering of Parent, hiring or firing a chief executive officer, chief financial officer or chief
operating officer, incurring or refinancing indebtedness in excess of $5,000,000 or engaging in new lines of business, require the approval of either (i) any three of JPMP, Apollo, Carlyle or
Bain or (ii) Spectrum and (a) either JPMP or Apollo and (b) either Carlyle or Bain (the "Requisite Stockholder Majority") if at such time the Sponsors collectively held at least a
majority of Parent's voting shares.

Prior
to the earlier of the end of the Blockout Period and the completion of an initial public offering of the capital stock of Parent, Holdings or AMCE, the Governance Agreements
prohibit the Sponsors and the other pre-existing stockholders of Holdings from transferring any of their interests in Parent, other than (i) certain permitted transfers to
affiliates or to persons approved of by the Sponsors and (ii) transfers after the Blockout Period subject to the rights described below.

The
Governance Agreements set forth additional transfer provisions for the Sponsors and the other pre-existing stockholders of Holdings with respect to the interests in
Parent, including the following:

Right of first offer.After the Blockout Date and prior to an initial public offering, Parent and, in the event Parent did not exercise
its right of
first offer, each of the Sponsors and the other preexisting stockholders of Holdings, have a right of first offer to purchase (on a pro rata basis in the case of the stockholders) all or any portion
of the shares of Parent that a Sponsor or other former continuing

105

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 16RELATED PARTY TRANSACTIONS (Continued)

stockholder
of Holdings was proposing to sell to a third party at the price and on the terms and conditions offered by such third party.

Drag-along rights.If, prior to an initial public offering, Sponsors constituting a Requisite Stockholder Majority propose to transfer
shares of Parent to an independent third party in a bona fide arm's-length transaction or series of transactions that resulted in a sale of all or substantially all of Parent, such Sponsors may have
elected to require each of the other stockholders of Holdings to transfer to such third party all of its shares at the purchase price and upon the other terms and subject to the conditions of the
sale.

Tag-along rights.Subject to the right of first offer described above, if any Sponsor or other former continuing stockholder of Holdings
proposes to transfer shares of Parent held by it, then such stockholder would give notice to each other stockholder, who would each have the right to participate on a pro rata basis in the proposed
transfer on the terms and conditions offered by the proposed purchaser.

Participant rights.On or prior to an initial public offering, the Sponsors and the other pre-existing stockholders of Holdings have
the
pro rata right to subscribe to any issuance by Parent or any subsidiary of shares of its capital stock or any securities exercisable, convertible or exchangeable for shares of its capital stock,
subject to certain exceptions.

The
Governance Agreements also provide for certain registration rights in the event of an initial public offering of Parent, including the following:

Demand rights.Subject to the consent of at least two of any of JPMP, Apollo, Carlyle and Bain during the first two years following an
initial public
offering, each Sponsor has the right at any time following an initial public offering to make a written request to Parent for registration under the Securities Act of part or all of the registrable
equity interests held by such stockholders at Parent's expense, subject to certain limitations. Subject to the same consent requirement, the other pre-existing stockholders of Holdings as
a group have the right at any time following an initial public offering to make one written request to Parent for registration under the Securities Act of part or all of the registrable equity
interests held by such stockholders with an aggregate offering price to the public of at least $200,000,000.

Piggyback rights.If Parent at any time proposes to register under the Securities Act any equity interests on a form and in a manner
which would
permit registration of the registrable equity interests held by stockholders of Parent for sale to the public under the Securities Act, Parent must give written notice of the proposed registration to
each stockholder, who then have the right to request that any part of its registrable equity interests be included in such registration, subject to certain limitations.

Holdback agreements.Each stockholder agrees that it would not offer for public sale any equity interests during a period not to exceed
90 days (180 days in the case of an initial public offering) after the effective date of any registration statement filed by Parent in connection with an underwritten public offering
(except as part of such underwritten registration or as otherwise permitted by such underwriters), subject to certain limitations.

106

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 16RELATED PARTY TRANSACTIONS (Continued)

Amended and Restated Fee Agreement

In connection with the Mergers, Holdings, AMCE and the Sponsors entered into an Amended and Restated Fee Agreement, which provided for
an annual management fee
of $5,000,000, payable quarterly and in advance to each Sponsor, on a pro rata basis, until the twelfth anniversary from December 23, 2004, and such time as the sponsors own less than 20% in
the aggregate of Parent. In addition, the fee agreement provided for reimbursements by AMCE to the Sponsors for their out-of-pocket expenses and to Holdings of up to $3,500,000
for fees payable by Holdings in any single fiscal year in order to maintain AMCE's and its corporate existence, corporate overhead expenses and salaries or other compensation of certain employees. The
Amended and Restated Fee Agreement terminated on June 11, 2007, the date of the holdco merger, and was superseded by a substantially identical agreement entered into by AMC Entertainment
Holdings, Inc., Holdings, AMCE, the Sponsors and Holdings' other stockholders.

Upon
the consummation of a change in control transaction or an initial public offering, each of the Sponsors will receive, in lieu of quarterly payments of the annual management fee, a
fee equal to the net present value of the aggregate annual management fee that would have been payable to the Sponsors during the remainder of the term of the fee agreement (assuming a twelve year
term from the date of the original fee agreement), calculated using the treasury rate having a final maturity date that is closest to the twelfth anniversary of the date of the original fee agreement
date. As of April 1, 2010, the Company estimates this amount would be $29,190,000 should a change in control transaction or an IPO occur.

The
fee agreement also provides that AMCE will indemnify the Sponsors against all losses, claims, damages and liabilities arising in connection with the management services provided by
the Sponsors under the fee agreement.

Parent
is owned by the Sponsors, other co-investors and by certain members of management as follows: JPMP (20.839%); Apollo (20.839%); Bain Capital Partners (15.13%); The
Carlyle Group (15.13%); Spectrum Equity Investors (9.79%); Weston Presidio Capital IV, L.P. and WPC Entrepreneur Fund II, L.P. (3.91%); Co-Investment Partners, L.P.
(3.91%); Caisse de Depot et Placement du Quebec (3.128%); AlpInvest Partners CS Investments 2003 C.V., AlpInvest Partners Later Stage Co-Investments Custodian II B.V. and AlpInvest
Partners Later Stage Co-Investments Custodian IIA B.V. (2.737%); SSB Capital Partners (Master Fund) I, L.P. (1.955%); CSFB Strategic Partners Holdings II, L.P., CSFB
Strategic Partners Parallel Holdings II, L.P., and GSO Credit Opportunities Fund (Helios), L.P. (1.564%); Credit Suisse Anlagestiftung, Pearl Holding Limited, Vega Invest (Guernsey)
Limited and Partners Group Private Equity Performance Holding Limited (0.782%); Screen Investors 2004, LLC (0.152%); and current and former members of management (0.134%)(1).

---

Control Arrangement

The Sponsors have the ability to control the Company's affairs and policies and the election of directors and appointment of
management.

107

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 16RELATED PARTY TRANSACTIONS (Continued)

DCIP

In February 2007, Mr. Travis Reid was hired as the chief executive officer of DCIP, a joint venture between AMCE, Cinemark and
Regal formed to explore the possibility of implementing digital cinema in the Company's theatres and to create a financing model and establish agreements with major motion picture studios for the
implementation of digital cinema. Mr. Reid is a member of the Company's Board of Directors. See Note 5Investments, for a discussion of transactions with DCIP.

Market Making Transactions

On August 18, 2004, Holdings sold $304,000,000 in aggregate principal amount at maturity of its 12% Senior Discount Notes due
2014. On June 9, 2009, AMCE sold $600,000,000 in aggregate principal amount of its Notes due 2019. On January 26, 2006, AMCE sold $325,000,000 in aggregate principal amount of its Notes
due 2016. JP Morgan Securities Inc., an affiliate of J.P. Morgan Partners, LLC which owns approximately 20.8% of Holdings, was an initial purchaser of these notes. Credit Suisse
Securities (USA) LLC, whose affiliates own approximately 1.6% of Parent, was also an initial purchaser of these notes.

NOTE 17CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY

Marquee Holdings Inc. is a holding company that conducts substantially all of its business operations through its subsidiaries and was formed on July 16, 2004.

There
are significant restrictions on the Company's ability to obtain funds from any of its subsidiaries through dividends, loans or advances. Accordingly, these condensed financial
statements have been presented on a "parent-only" basis. Under a parent-only presentation, the Company's investments in its consolidated subsidiaries are presented under the
equity method of accounting. These parent-only financial statements should be read in conjunction with the Company's audited consolidated financial statements.

108

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 17CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Continued)

Marquee Holdings Inc.    CONDENSED STATEMENTS OF OPERATIONSPARENT ONLY

(In thousands)

52 Weeks
Ended
April 1,
2010

52 Weeks
Ended
April 2,
2009

53 Weeks
Ended
April 3,
2008Costs and ExpensesGeneral and administrative:Merger, acquisition and transaction costs

$
103

$
2

$
2,633Other


106


119


75Total costs and expenses


209


121


2,708Other expense (income)Equity in (earnings) loss of AMC Entertainment Inc.


(69,790
)

81,172


(43,445
)Interest expenseCorporate borrowings


29,962


29,900


29,745Investment income


(35
)

(35
)

(141
)Total other (income) expense


(39,863
)

111,037


(13,841
)Earnings (loss) before income taxes


39,654


(111,158
)

11,133Income tax benefit








(11,600
)Net earnings (loss)

$
39,654

$
(111,158
)
$
22,733


109

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 17CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Continued)

Marquee Holdings Inc.    CONSOLIDATED BALANCE SHEETSPARENT ONLY

(In thousands, except share data)

April 1, 2010

April 2, 2009AssetsCash and equivalents

$
2,605

$
2,571Receivables





Other current assets





Total current assets


2,605


2,571Goodwill


21,993


21,993Investment in AMC Entertainment Inc.


760,559


1,039,603Other long-term assets


5,828


6,973Total assets

$
790,985

$
1,071,140Liabilities and Stockholder's EquityCurrent liabilities:Accrued expenses and other liabilities

$
4,092

$
4,167Total current liabilities


4,092


4,167Corporate borrowings


240,795


240,795Total liabilities


244,887


244,962Stockholder's Equity:Common Stock, 1 shares issued with 1¢ per value





Additional paid-in capital


747,206


1,046,703Accumulated other comprehensive income (loss)


(3,176
)

17,061Accumulated deficit


(197,932
)

(237,586
)Total stockholder's equity


546,098


826,178Total liabilities and stockholder's equity

$
790,985

$
1,071,140


110

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 17CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Continued)

Marquee Holdings Inc.    CONDENSED STATEMENTS OF CASH FLOWSPARENT ONLY

(In thousands)

52 Weeks
Ended
April 1, 2010

52 Weeks
Ended
April 2, 2009

53 Weeks
Ended
April 3, 2008INCREASE (DECREASE) IN CASH AND EQUIVALENTSCash flows from operating activitiesNet earnings (loss)

$
39,654

$
(111,158
)
$
22,733Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:Amortization of discount on corporate borrowings








10,390Deferred income taxes








(11,600
)Equity in (earnings) loss of AMC Entertainment Inc.


(69,790
)

81,172


(43,445
)Net change in operating activities:Receivables and other assets


6


286


(260
)Accrueds and other liabilities


(79
)

(4,047
)

1,462Other, net


1,145


1,142


2,283Net cash used in operating activities


(29,064
)

(32,605
)

(18,437
)Cash flows from investing activitiesDividends from AMC Entertainment Inc.


329,981


35,989


293,551Net cash provided by investing activities


329,981


35,989


293,551Cash flows from financing activitiesDividends paid to Parent


(300,881
)

(3,349
)

(270,588
)Deferred financing costs


(2
)




(4,360
)Net cash used in financing activities


(300,883
)

(3,349
)

(274,948
)Net increase in cash and equivalents


34


35


166Cash and equivalents at beginning of year


2,571


2,536


2,370Cash and equivalents at end of year

$
2,605

$
2,571

$
2,536Schedule of non-cash investing activities:Contribution from AMCE

$


$


$
3,279


111

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 17CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Continued)

Marquee Holdings Inc.

CONDENSED STATEMENTS OF STOCKHOLDER'S EQUITYPARENT ONLY

Class A-1
Voting
Common Stock

Class A-2
Voting
Common Stock

Class N
Nonvoting
Common Stock

Class L-1
Voting
Common Stock

Class L-2
Voting
Common StockCommon Stock



Accumulated
Other
Comprehensive
Income (Loss)Additional
Paid-in
Capital

Accumulated
Deficit

Total
Stockholder's
Equity(In thousands, except
share and per share data)

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

Shares

AmountBalance, March 29, 2007




$



382,475.00000

$
4


382,475.00000

$
4


5,128.77496

$



256,085.61252

$
3


256,085.61252

$
3

$
1,314,579

$
(3,834
)
$
(143,706
)
$
1,167,053Comprehensive earnings:Net earnings












































22,733


22,733ASC 740 (formerly FIN 48) adoption adjustment












































(5,373
)

(5,373
)Foreign currency translation adjustment









































(1,708
)




(1,708
)Change in fair value of cash flow hedges









































(5,507
)




(5,507
)Losses on interest rate swaps reclassified to interest expense corporate borrowings









































1,523





1,523Unrealized loss on marketable equity securities















































Pension and other benefit adjustments









































6,532





6,532Unrealized loss on marketable equity securities









































(674
)




(674
)Comprehensive earnings















































17,526Stock-based compensationoptions






































3,439








3,439Dividends received from AMC Entertainment Inc






































(270,588
)







(270,588
)Conversion of stock upon creation of Entertainment Holdings, Inc.


1





(382,475.00000
)

(4
)

(382,475.00000
)

(4
)

(5,128.77496
)




(256,085.61252
)

(3
)

(256,085.61252
)

(3
)










(14
)Balance, April 3, 2008


1



































1,047,430


(3,668
)

(126,346
)

917,416


112

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Table of Contents

Marquee Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Years Ended April 1, 2010, April 2, 2009 and April 3, 2008

NOTE 17CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Continued)

Marquee Holdings Inc.

CONDENSED STATEMENTS OF STOCKHOLDER'S EQUITYPARENT ONLY (Continued)

Class A-1
Voting
Common Stock

Class A-2
Voting
Common Stock

Class N
Nonvoting
Common Stock

Class L-1
Voting
Common Stock

Class L-2
Voting
Common StockCommon Stock



Accumulated
Other
Comprehensive
Income (Loss)Additional
Paid-in
Capital

Accumulated
Deficit

Total
Stockholder's
Equity(In thousands, except
share and per share data)

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

Shares

AmountComprehensive lossNet loss












































(111,158
)

(111,158
)Foreign currency translation adjustment









































25,558





25,558Change in fair value of cash flow hedges









































(1,833
)




(1,833
)Losses on interest rate swaps reclassified to interest expense corporate borrowings









































5,230





5,230Pension and other benefit adjustments









































(8,117
)




(8,117
)Unrealized loss on marketable securities









































(109
)




(109
)Comprehensive loss















































(90,429
)ASC 715 (formerly SFAS 158) adoption adjustment












































(82
)

(82
)Stock-based compensationoptions






































2,622








2,622Dividends paid to AMC Entertainment Holdings, Inc.






































(3,349
)







(3,349
)Balance April 2, 2009


1



































1,046,703


17,061


(237,586
)

826,178Comprehensive earningsNet earnings












































39,654


39,654Foreign currency translation adjustment









































(13,021
)




(13,021
)Change in fair value of cash flow hedges









































(6
)




(6
)Losses on interest rate swaps reclassified to interest expense corporate borrowings









































558





558Pension and other benefit adjustments









































(8,499
)




(8,499
)Unrealized gain on marketable securities









































731





731Comprehensive earnings















































19,417Stock-based compensationoptions






































1,384








1,384Dividends paid to AMC Entertainment Holdings, Inc.






































(300,881
)







(300,881
)Balance April 1, 2010


1

$





$





$





$





$





$


$
747,206

$
(3,176
)
$
(197,932
)
$
546,098


113

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Table of Contents

Item 9.    Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

None

Item 9A(T).    Controls and Procedures

(a)   Evaluation
of disclosure controls and procedures.

The
Company maintains a set of disclosure controls and procedures designed to provide reasonable assurance that material information required to be disclosed in its filings under the
Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that material
information is accumulated and communicated to the Company's management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required
disclosure. The Company's Chief Executive Officer and Chief Financial Officer have evaluated these disclosure controls and procedures as of the end of the period covered by this Annual Report on
Form 10-K and have determined that such disclosure controls and procedures were effective.

(b)   Management's
annual report on internal control over financial reporting.

Management
is responsible for establishing and maintaining adequate internal control over financial reporting for the Company as defined in Rule 12a-15(f) of the
Exchange Act. With our participation, an evaluation of the effectiveness of internal control over financial reporting was conducted as of April 1, 2010, based on the framework and criteria
established inInternal ControlIntegrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission. Based
on this evaluation, our management has concluded that our internal control over financial reporting was effective as of April 1, 2010.

This
annual report does not include an attestation report of the Company's independent registered public accounting firm regarding internal control over financial reporting. Management's
report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only
management's report in this annual report.

(c)   Changes
in internal control over financial reporting.

There
has been no change in our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting.

Item 9B.    Other Information

None

114

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Table of Contents

Item 10.    Directors, Executive Officers and Corporate Governance

MANAGEMENT

Our business and affairs are managed by our board of directors currently consisting of nine members. Gerardo I. Lopez, our Chief
Executive Officer, is a director of Parent. Aaron J. Stone is our Chairman of the Board and a non-employee director. The role of Chairman of the Board is held by Mr. Stone to
represent the interest of shareholders.

The
following table sets forth certain information regarding our directors, executive officers and key employees as of May 7, 2010:

Name

Age

Position(s) HeldAaron J. Stone


37

Chairman of the Board, Director (Parent, Holdings and AMC Entertainment)Gerardo I. Lopez


50

Chief Executive Officer, President and Director (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)Dana B. Ardi


62

Director (Parent, Holdings and AMC Entertainment)Stephen P. Murray


47

Director (Parent, Holdings and AMC Entertainment)Stan Parker


34

Director (Parent, Holdings and AMC Entertainment)Phillip H. Loughlin


42

Director (Parent, Holdings and AMC Entertainment)Eliot P. S. Merrill


39

Director (Parent, Holdings and AMC Entertainment)Kevin Maroni


47

Director (Parent, Holdings and AMC Entertainment)Travis Reid


55

Director (Parent, Holdings and AMC Entertainment)Craig R. Ramsey


58

Executive Vice President and Chief Financial Officer (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.); Director (American Multi-Cinema, Inc.)John D. McDonald


52

Executive Vice President, U.S. and Canada Operations (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.); Director (American Multi-Cinema, Inc.)Mark A. McDonald


51

Executive Vice President, International Operations (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)Stephen A. Colanero


43

Executive Vice President and Chief Marketing Officer (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)Robert J. Lenihan


56

President, Film Programming (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)Samuel D. Gourley


58

President, AMC Film Programming (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)Kevin M. Connor


47

Senior Vice President, General Counsel and Secretary (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)Michael W. Zwonitzer


45

Senior Vice President Finance (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)Chris A. Cox


44

Senior Vice President and Chief Accounting Officer (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)Terry W. Crawford


53

Senior Vice President and Treasurer (Parent, Holdings, AMC Entertainment and American Multi-Cinema, Inc.)George Patterson


56

Vice President Food and Beverage (AMC Entertainment)


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All
our current executive officers hold their offices at the pleasure of our board of directors, subject to rights under their respective employment agreements. There are
no family relationships between or among any directors and executive officers, except that Messrs. John D. McDonald and Mark A. McDonald are brothers.

Mr. Aaron J. Stonehas served as Chairman of the Board of Parent, Holdings and AMC Entertainment since February 2009.
Mr. Stone has served as a Director of Parent since June 2007, and has served as a Director of Holdings and AMC Entertainment since December 2004. Mr. Stone serves on the compensation
committee. Mr. Stone is a Senior Partner of Apollo Management, L.P. which, together with its affiliates, acts as manager of Apollo and related private securities investment funds.
Mr. Stone also serves on the boards of directors of Connections Academy, LLC since 2007; Hughes Communications, Inc. since 2005 and serves on the compensation and nominating and
governance committees; Hughes Network Systems, LLC since 2005 and serves on the audit committee; Hughes Telematics, Inc. since 2009; and Parallel Petroleum since 2009. Mr. Stone
has also served on the boards of directors of Educate Inc. from 2002-2007 and served on the audit committee; Intelstat, Ltd from 2005-2008 and also served on the
audit committee; and Skyterra Communications Inc. from 2005-2008, among others. Prior to joining Apollo, Mr. Stone was a member of the Mergers and Acquisition Group at Smith
Barney, Inc. Mr. Stone holds an A.B. degree from Harvard College.

Mr. Gerardo I. Lopezhas served as Chief Executive Officer, President and a Director of Parent, Holdings and AMC Entertainment
since March 2009. Prior to joining the Company, Mr. Lopez served as Executive Vice President of Starbucks Coffee Company and President of its Global Consumer Products, Seattle's Best Coffee and
Foodservice divisions from September 2004 to March 2009. Prior thereto, Mr. Lopez served as President of the Handleman Entertainment Resources division of Handleman Company from November 2001
to September 2004. Mr. Lopez also serves on the boards of directors of SilkRoute Global, National CineMedia, LLC and Digital Cinema Implementation Partners, LLC. Mr. Lopez
holds a B.S. degree in Marketing from George Washington University and a M.B.A. in Finance from Harvard Business School.

Dr. Dana B. Ardihas served as a Director of Parent, Holdings and AMC Entertainment since April 2009. Dr. Ardi serves as
Managing Director and Founder of Corporate Anthropology Advisors LLC, a consulting company that provides human capital advisory and innovative solutions that build value through organizational design
and people development. Prior to founding Corporate Anthropology Advisors LLC in 2009, Dr. Ardi served as a Managing Director at CCMP Capital Advisors, LLC from August 2006 through
January 2009, as a Partner at J.P. Morgan Partners, LLC from June 2001 to July 2006, as a Partner at Flatiron Partners, LLC from 1999 to June 2001, as Co-chair of the Global
Communications, Entertainment and Technology practice of TMP Worldwide from 1995 to 1999 and prior thereto, Dr. Ardi served as Senior Vice President of New Media at R.R. Donnelley & Sons
Company. Dr. Ardi holds a B.S. degree from the State University of New York at Buffalo and M.S. and Ph.D. degrees in Education from Boston College.

Mr. Stephen P. Murrayhas served as a Director of Parent since June 2007, and has served as a Director of Holdings and AMC
Entertainment since December 2004. Mr. Murray serves on the compensation committee of Parent. Mr. Murray serves as President and Chief Executive Officer of CCMP Capital
Advisors, LLC, a private equity firm formed in August 2006 by the former buyout/growth equity
investment team of J.P. Morgan Partners, LLC, a private equity division of JPMorgan Chase & Co. Mr. Murray is also an investment committee member of Octagon Credit
Investors, LLC. Mr. Murray focuses on investments in Consumer, Retail and Services, and Healthcare Infrastructure. Prior to joining J.P. Morgan Partners, LLC in 1989,
Mr. Murray served as a Vice President with the Middle-Market Lending Division of Manufacturers Hanover. Mr. Murray also serves on the boards of directors of ARAMARK Holdings Corporation,
Caremore Medical Enterprises, Generac Power Systems, Chef's Warehouse, Crestcom, Jetro Holdings, Inc., LHP Hospital Group, Noble Environmental Power, Quiznos Subs, Strongwood Insurance and
Warner Chilcott. Mr. Murray holds a B.A. degree from Boston College and a M.B.A. from Columbia Business School.

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Mr. Stan Parkerhas served as a Director of Parent since June 2007, and has served as a Director of Holdings and AMC Entertainment
since December 2004. Mr. Parker serves on the audit committee of Parent, Holdings and AMC Entertainment. Mr. Parker has been affiliated with Apollo and its related investment advisors
and investment managers since 2000 and has been a Partner since 2005. Prior to joining Apollo in 2000, Mr. Parker was employed by Salomon Smith Barney, Inc. Mr. Parker also serves
on the boards of directors of Affinion, CEVA Group Plc, and Momentive Performance Materials. Mr. Parker holds a B.S. degree in Economics from The Wharton School of Business at the
University of Pennsylvania.

Mr. Philip H. Loughlinhas served as a Director of Parent, Holdings and AMC Entertainment since January 2009. Mr. Loughlin
serves on the compensation committee of Parent, Holdings and AMC Entertainment. Mr. Loughlin joined Bain Capital in 1996 and has been a Managing Director since 2003. Prior to joining Bain
Capital, Mr. Loughlin was a Consultant at Bain & Company and served in operating roles at Eagle Snacks, Inc. and Norton Company. Mr. Loughlin also serves on the boards of
directors of OSI Restaurant Partners, Ariel Holdings, Applied Systems Inc. and the National Pancreas Foundation. Mr. Loughlin serves on the audit committee of OSI Restaurant Partners.
Mr. Loughlin previously served on the boards of directors of Burger King Corporation, Loews Cineplex Entertainment, Brenntag A.G. and Professional Services Industries, Inc. and on the
audit committees of Burger King Corporation and Loews Cineplex Entertainment. Mr. Loughlin received a M.B.A. from Harvard Business School where he was a Baker Scholar and graduated cum laude
with an A.B. degree from Dartmouth College.

Mr. Eliot P. S. Merrillhas served as a Director of Parent, Holdings and AMC Entertainment since January 2008. Mr. Merrill
serves on the audit committee of Parent, Holdings and AMC Entertainment and the compensation committee of Parent. Mr. Merrill is a Managing Director of The Carlyle Group focusing on buyout
opportunities in the media and telecommunications sectors. Prior to joining Carlyle in 2001, Mr. Merrill was a Principal at Freeman Spogli & Co., a buyout fund with offices in New
York and Los Angeles. From 1995 to 1997, Mr. Merrill worked at Dillon Read & Co. Inc. Prior thereto, Mr. Merrill worked at Doyle Sailmakers, Inc.
Mr. Merrill also serves as a director of The Nielsen Company B.V. Mr. Merrill holds an A.B. degree from Harvard College.

Mr. Kevin Maronihas served as a Director of Parent, Holdings and AMC Entertainment since April 2008. Mr. Maroni serves on
the audit committee of Parent, Marquee and AMC Entertainment. Mr. Maroni serves as Senior Managing Director of Spectrum Equity Investors ("Spectrum"), an investment firm with offices in Boston
and Menlo Park. Mr. Maroni has served on the boards of directors of numerous public and private companies, including most recently Consolidated Communications, Inc. from
2002 - 2005; NEP Broadcasting, L.P. from 2004-2007; and Classic Media, L.P. from 2006-2007. Prior to joining Spectrum at inception in
1994, Mr. Maroni worked at Time Warner, Inc. and Harvard Management Company's private equity affiliate. Mr. Maroni has also served as a trustee of numerous non-profit
institutions, which currently include National Geographic Ventures; the John F. Kennedy Library Foundation and the Park School. Mr. Maroni holds a B.A. degree from the University of Michigan
and a M.B.A. from Harvard University.

Mr. Travis Reidhas served as a Director of Parent since June 2007, and has served as a Director of Holdings and AMC Entertainment
since January 2006. Mr. Reid serves on the audit committee of Parent, Holdings and AMC Entertainment. Mr. Reid serves as Chief Executive Officer and a director of Digital Cinema
Implementation Partners LLC. Prior thereto, Mr. Reid served as President, Chief Executive Officer and a director of Loews Cineplex Entertainment Corp. from April 2002 to January 2006.
Mr. Reid served as President, North American Operations of Loews from May 1998 to April 2002. Prior thereto, Mr. Reid served as President of Loews beginning October 1996 and for the
preceding year served as Executive Vice President, Film Buying of Loews. Prior to joining Loews in 1991, Mr. Reid held senior film buying positions at General Cinema Corp., Cineamerica
Theatres, Century Theatres and Theatre Management Inc. Mr. Reid has been in the film exhibition industry for

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30 years.
Mr. Reid began his career at age 20 at a drive-in movie theatre in California. Mr. Reid holds a B.S. degree in Business Administration from California State
University at Hayward.

Mr. Craig R. Ramseyhas served as Executive Vice President and Chief Financial Officer of Parent and Holdings since June 2007 and
December 2004, respectively. Mr. Ramsey has served as Executive Vice President and Chief Financial Officer of AMC Entertainment and American Multi-Cinema, Inc. since April 2003.
Previously, Mr. Ramsey served as Executive Vice President, Chief Financial Officer and Secretary of AMC Entertainment and American Multi-Cinema, Inc. since April 2002. Mr. Ramsey
served as Senior Vice President, Finance, Chief Financial Officer and Chief Accounting Officer, of AMC Entertainment and American Multi-Cinema, Inc. from August 1998 until May 2002.
Mr. Ramsey has served as a Director of American Multi-Cinema, Inc. since September 1999. Mr. Ramsey was elected Chief Accounting Officer of AMC Entertainment and American
Multi-Cinema, Inc. in February 2000. Mr. Ramsey served as Vice President, Finance from January 1997 to October 1999 and prior thereto, Mr. Ramsey served as Director of Information
Systems and Director of Financial Reporting since joining American Multi-Cinema, Inc. in February 1995. Mr. Ramsey currently serves as a member of the board of directors of
Movietickets.com and has previously served on the board of directors of Bank Midwest. Mr. Ramsey holds a B.S. degree in Accounting and Business Administration from the University of Kansas.

Mr. John D. McDonaldhas served as Executive Vice President, U.S. Operations of Parent, Holdings and AMC Entertainment since July
2009. Mr. McDonald has served as Director of American Multi-Cinema, Inc. since November 2007 and has served as Executive Vice President, U.S. Operations of American
Multi-Cinema, Inc. since July 2009. Prior to July 2009, Mr. McDonald served as Executive Vice President, U.S. and Canada Operations of American Multi-Cinema, Inc. effective
October 1998. Mr. McDonald served as Senior Vice President, Corporate Operations from November 1995 to October 1998. Mr. McDonald is a member of the National Association of Theatre
Owners Advisory board of directors. Mr. McDonald has successfully managed the integration for the Gulf States, General Cinema, and Loews mergers and acquisitions. Mr. McDonald attended
California State Polytechnic University where he studied economics and history.

Mr. Mark A. McDonaldhas served as Executive Vice President, Global Development since July 2009 of Parent, Holdings and AMC
Entertainment. Prior thereto, Mr. McDonald served as Executive Vice President, International Operations of Parent, Holdings and AMC Entertainment from October 2008 to July 2009.
Mr. McDonald has served as Executive Vice President, International Operations of American Multi-Cinema, Inc., and AMC Entertainment International, Inc., a subsidiary of American
Multi-Cinema, Inc., since March 2007 and December 1998, respectively. Prior thereto, Mr. McDonald served as Senior Vice President, Asia Operations from November 1995 until his
appointment as Executive Vice President, International Operations and Film in December 1998. Mr. McDonald served on the board of directors of AMC Entertainment International, Inc. from
March 2007 to May 2010. Mr. McDonald holds a B.A. degree from the University of Southern California and a M.B.A. from the Anderson School at University of California Los Angeles.

Mr. Stephen A. Colanerohas served as Executive Vice President and Chief Marketing Officer of Parent, Holdings and AMC
Entertainment since December 2009. Prior to joining AMC, Mr. Colanero served as Vice President of Marketing for RadioShack Corporation from April 2008 to December 2009. Mr. Colanero also
served as Senior Vice President of Retail Marketing for Washington Mutual Inc. from February 2006 to August 2007 and as Senior Vice President, Strategic Marketing for Blockbuster Inc.
from November 1994 to January 2006. Mr. Colanero holds a B.S. degree in Accounting from Villanova University and a M.B.A. in Marketing and Strategic Management from The Wharton School at the
University of Pennsylvania.

Mr. Robert J. Lenihanhas served as President, Programming, of Parent, Holdings and AMC Entertainment since April 2009. Prior to
joining AMC, Mr. Lenihan served as Executive Vice President for Loews Cineplex Entertainment Corp from August 1998 to February 2002. Mr. Lenihan was

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appointed
Senior Vice President and Head Film Buyer at Mann Theatres in 1985 and served in that capacity at Act III Theatres, Century Theatres, Sundance Cinemas and most recently at Village Roadshow.
Mr. Lenihan holds a B.S. degree from Rowan University.

Mr. Samuel D. "Sonny" Gourleyhas served as President of AMC Film Programming of Parent, Holdings and AMC Entertainment since
December 2009. Mr. Gourley has served as President of AMC Film
Programming a Division of American Multi-Cinema, Inc. since November 2005. Prior thereto, Mr. Gourley served as Executive Vice President, National Film from November 2002 to November
2005 and Executive Vice President, East Film from November 1999 to November 2002. Mr. Gourley currently serves on the advisory board of Tent 25 VarietyThe Children's Charity
located in Los Angeles, as well as serving on the board of the local Tent 8 VarietyThe Children's Charity in Kansas City. Mr. Gourley holds a B.A. degree in English from Miami
University in Oxford, Ohio.

Mr. Kevin M. Connorhas served as Senior Vice President, General Counsel and Secretary of Parent and Holdings since June 2007 and
December 2004, respectively. Mr. Connor has served as Senior Vice President, General Counsel and Secretary of AMC Entertainment and American Multi-Cinema, Inc. since April 2003. Prior to
April 2003, Mr. Connor served as Senior Vice President, Legal of AMC Entertainment and American Multi-Cinema, Inc. beginning November 2002. Prior thereto, Mr. Connor was in
private practice in Kansas City, Missouri as a partner with the firm Seigfreid, Bingham, Levy, Selzer and Gee from October 1995. Mr. Connor holds a Bachelor of Arts degree in English and
History from Vanderbilt University, a Juris Doctorate degree from the University of Kansas School of Law and a LLM in Taxation from the University of MissouriKansas City.

Mr. Michael W. Zwonitzerhas served as Senior Vice President, Finance of Parent, Holdings and AMC Entertainment since July 2009.
Prior thereto, Mr. Zwonitzer served as Vice President, Finance of Parent and Holdings since June 2007 and December 2004, respectively. Mr. Zwonitzer has served as Vice President, Finance
of AMC Entertainment and American Multi-Cinema, Inc. since September 2004 and prior thereto, Mr. Zwonitzer served as Director of Finance from December 2002 to September 2004 and Manager
of Financial Analysis from November 2000 to December 2002. Mr. Zwonitzer joined AMC in June 1998. Mr. Zwonitzer holds a B.S. degree in Accounting from the University of Missouri.

Mr. Chris A. Coxhas served as Senior Vice President and Chief Accounting Officer of Parent and Holdings since June 2010. Prior
thereto Mr. Cox served as Vice President and Chief Accounting Officer of Parent and Holdings since June 2007 and December 2004, respectively. Mr. Cox has served as Vice President and Chief
Accounting Officer of AMC Entertainment and American Multi-Cinema, Inc. since May 2002. Prior to May 2002, Mr. Cox served as Vice President and Controller of American
Multi-Cinema, Inc. since November 2000. Previously, Mr. Cox served as Director of Corporate Accounting for the Dial Corporation from December 1999 until November 2000. Mr. Cox
holds a Bachelor's of Business Administration in Accounting and Finance degree from the University of Iowa.

Mr. Terry W. Crawfordhas served as Senior Vice President and Treasurer of Parent since June 2010. Previously, Mr. Crawford
served as Vice President and Treasurer of Parent since June 2007 and of Holdings AMC Entertainment and American Multi-Cinema, Inc. since April 2005. Prior thereto,
Mr. Crawford served as Vice President and Assistant Treasurer of Holdings, AMC Entertainment and American Multi-Cinema, Inc. from December 2004 until April 2005. Previously,
Mr. Crawford served as Vice President, Assistant Treasurer and Assistant Secretary of AMC Entertainment from May 2002 until December 2004 and American Multi-Cinema, Inc. from January
2000 until December 2004. Mr. Crawford served as Assistant Treasurer and Assistant Secretary of AMC Entertainment from September 2001 until May 2002 and AMC from November 1999 until December
2004. Mr. Crawford served as Assistant Secretary of AMC Entertainment from March 1997 until September 2001 and American Multi-Cinema, Inc. from March 1997 until November 1999. Prior to
joining AMC, Mr. Crawford served as Vice President and Treasurer for Metmor Financial, Inc., a wholly-owned

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subsidiary
of Metropolitan Life Insurance Company. Mr. Crawford holds a B.S. degree in Business from Emporia State University and a M.B.A. from the University of MissouriKansas
City.

Mr. George Pattersonhas served as Senior Vice President of Food and Beverage since February 2010. Prior to joining the Company,
Mr. Patterson served as Director of Asset Strategy and Multibrand Execution for YUM Brands from 2002 to 2010. Prior to joining YUM Brands, Mr. Patterson was Co-founder and
COO of Cool Mountain Creamery and Café from 1997 to 2002. Prior to developing Cool Mountain Creamery and Café, Mr. Patterson was Regional Vice President for
Wendy's International restaurants. Mr. Patterson holds a B.A. degree from the University of Florida.

Code of Business Conduct and Ethics

We have a Code of Business Conduct and Ethics that applies to all of our associates, including our principal executive officer,
principal financial officer and principal accounting officer, or persons performing similar functions. These standards are designed to deter wrongdoing and to promote honest and ethical conduct. The
Code of Business Conduct and Ethics, which address the subject areas covered by the SEC's rules, are posted on our website:www.amctheatres.comunder
"Investor RelationsCorporate Governance." Any substantive amendment to, or waiver from, any provision of the Code of Business Conduct and Ethics with respect to any senior executive or
financial officer shall be posted on this website. The information contained on our website is not part of this Annual Report on Form 10-K.

Item 11.    Executive Compensation.

COMPENSATION DISCUSSION AND ANALYSIS

This section discusses the material elements of compensation awarded to, earned by or paid to our principal executive officer, our
principal financial officer, our three other most highly compensated executive officers as well as an additional executive officer whose compensation otherwise would have been subject to reporting had
there not been any option grants in fiscal 2010. These individuals are referred to as the "Named Executive Officers."

Our
executive compensation programs are determined and approved by our Compensation Committee. None of the Named Executive Officers are members of the Compensation Committee or otherwise
had any role in determining the compensation of other Named Executive Officers, although the Compensation Committee does consider the recommendations of our Chief Executive Officer in setting
compensation levels for our executive officers other than the Chief Executive Officer.

Executive Compensation Program Objectives and Overview

The goals of the Compensation Committee with respect to executive compensation are to attract, retain, motivate and reward talented
executives, to tie annual and long-term compensation incentives to the achievement of specified performance objectives, and to achieve long-term creation of value for our
stockholders by aligning the interests of these executives with those of our stockholders. To achieve these goals, we endeavor to maintain compensation plans that are intended to tie a substantial
portion of executives' overall compensation to key strategic, operational and financial goals such as achievement of budgeted levels of adjusted EBITDA or revenue, and other non-financial
goals that the Compensation Committee deems important. From time to time, the Compensation Committee evaluates individual executive performance with a goal of setting compensation at levels they
believe, based on industry comparables and their general business and industry knowledge and experience, are comparable with executives in other companies of similar size and stage of development
operating in the theatrical exhibition industry and similar retail type businesses, while taking into account our relative performance and our own strategic goals.

We
conduct a periodic review of the aggregate level of our executive compensation as part of the annual budget review and annual performance review processes, which includes determining
the

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operating
metrics and non-financial elements used to measure our performance and to compensate our executive officers. This review is based on our knowledge of how other theatrical
exhibition industry and similar retail type businesses measure their executive performance and on the key operating metrics that are critical in our effort to increase the value of our company.

Current Executive Compensation Program Elements

Our executive compensation program consists of the elements described in the following sections. The Compensation Committee determines
the portion of compensation allocated to each element for each individual Named Executive Officer. Our Compensation Committee expects to continue these policies in the short term but will reevaluate
the current policies and practices as it considers advisable.

The
Compensation Committee believes based on their general business and industry experience and knowledge that the use of the combination of base salary, discretionary annual performance
bonuses, and long-term incentives (including stock option or other stock-based awards) offers the best approach to achieving our compensation goals, including attracting and retaining
talented and capable executives and motivating our executives and other officers to expend maximum effort to improve the business results, earnings and overall value of our business.

Base Salaries

Base salaries for our Named Executive Officers are established based on the scope of their responsibilities, taking into account
competitive market compensation for similar positions, as well as seniority of the individual, our ability to replace the individual and other primarily judgmental factors deemed relevant by the
Compensation Committee. Generally, we believe that executive base salaries should be targeted near the median of the range of salaries for executives in similar positions with similar responsibilities
at comparable companies, in line with our compensation philosophy, but we do not make any determinations or changes in compensation in reaction to market data alone. The Compensation Committee's goal
is to provide total compensation packages that are competitive with prevailing practices in our industry and in the geographic markets in which we conduct business. However, the Compensation Committee
retains flexibility within the compensation program to
respond to and adjust for specific circumstances and our evolving business environment. Periodically, the Company obtains information regarding the salaries of employees at comparable companies,
including approximately 150 multi-unit businesses in the retail, entertainment and food service industries. Base salaries for our Named Executive Officers are reviewed at appropriate times
by the Compensation Committee and may be increased from time to time pursuant to such review and/or in accordance with guidelines contained in the various employment agreements in order to realign
salaries with market levels after taking into account individual responsibilities, performance and experience. Base salaries for our Named Executive Officers were essentially unchanged from fiscal
2009 to fiscal 2010.

Annual Performance Bonus

The Compensation Committee has the authority to award annual performance bonuses to our Named Executive Officers. Under the current
employment agreements, each Named Executive Officer is eligible for an annual bonus based on our annual incentive compensation program as it may exist from time to time. We believe that annual bonuses
based on performance serve to align the interests of management and shareholders, and our annual bonus program is primarily designed to reward increases in adjusted EBITDA. Individual bonuses are
performance based and, as such, can be highly variable from year to year. The annual incentive bonuses for our Named Executive Officers are determined by our Compensation Committee and, except with
respect to his own bonus, our chief executive officer, based on our annual incentive compensation program as it may exist from time to time. For fiscal 2010, the annual incentive compensation program
was based on a company component and an individual component. The company component was based primarily on attainment of an adjusted EBITDA target of $314,811,000. The plan guideline was that no
company performance

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component
of the bonus would be paid below attainment of 90% of targeted adjusted EBITDA and that upon attainment of 100% of targeted adjusted EBITDA, each Named Executive Officer would receive 100%
of his assigned bonus target. Upon attainment of 110% of targeted adjusted EBITDA, each Named Executive Officer would receive a maximum of 200% of his assigned bonus target. The individual component
of the bonus does not have an adjusted EBITDA threshold but is based on achievement of key performance measures and overall performance and contribution to our strategic and financial goals. Under the
annual incentive compensation program, our Compensation Committee and, except with respect to his own bonus, chief executive officer, retain discretion to decrease or increase bonuses relative to the
guidelines based on qualitative or other objective factors deemed relevant by the Compensation Committee.

The
following table summarizes the company component upon attainment of 100% of targeted adjusted EBITDA and the individual component of the annual performance bonus plan for fiscal
2010:

Company
Component at
100% Target

Individual
ComponentGerardo I. Lopez

$
392,000

$
98,000Craig R. Ramsey


200,200


50,050John D. McDonald


200,200


50,050Robert J. Lenihan


151,400


37,850Kevin M. Connor


156,000


39,000Samuel D. Gourley


138,000


34,500


Our annual bonuses have historically been paid in cash and traditionally have been paid in a single installment in the first quarter following the
completion of a given fiscal year following issuance of our annual audit report. Pursuant to current employment agreements, each Named Executive officer is eligible for an annual bonus pursuant to the
annual incentive plan in place at the time. The Compensation Committee has discretion to increase the annual bonus paid to our Named Executive Officers using its judgment if the Company exceeds
certain financial goals, or to reward for achievement of individual annual performance objectives. Our Compensation Committee and the Board of Directors have approved bonus amounts to be paid in
fiscal 2011 for the performance during fiscal 2010. The Company obtained an adjusted EBITDA of 104% of target for fiscal 2010 which is equivalent to an approximate 142% payout of the assigned bonus
target. The individual component of the bonus was determined following a review of each Named Executive Officer's individual performance and contribution to our strategic and financial goals. For
fiscal 2010, this review was conducted during the first quarter of fiscal 2011.

Special Incentive Bonus

Pursuant to his employment agreement, Mr. Gerardo Lopez is entitled to a one-time special incentive bonus of
$2,000,000 that vests at the rate of $400,000 per year over five years, effective March 2009, provided that he remains employed on each vesting date. The first three installments of the special
incentive bonus are payable on the third anniversary and the fourth and fifth installments are payable upon vesting. The special incentive bonus of $2,000,000 shall immediately vest in full upon
Mr. Lopez's involuntary termination within twelve months after a change of control, as defined in the employment agreement. As of April 1, 2010, Mr. Lopez has vested in
one-fifth, or $400,000, of this special incentive bonus to be paid on his third anniversary.

Long Term Incentive Equity Awards

In connection with the holdco merger, on June 11, 2007, Parent adopted an amended and restated 2004 stock option plan (formerly
known as the 2004 Stock Option Plan), which provides for the grant of incentive stock options (within the meaning of Section 422 of the Internal Revenue Code) and non-qualified
stock options to acquire Parent common stock to eligible employees and consultants of Parent and its subsidiaries and non-employee directors of Parent. Options granted under the plan vest
in equal installments over three to five years from the grant date, subject to the optionee's continued service with Parent or one of its subsidiaries. The Compensation Committee approved stock
option grants to Mr. Robert Lenihan and Mr. Samuel Gourley during fiscal 2010.

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Retirement Benefits

We provide retirement benefits to the Named Executive Officers under both qualified and non-qualified defined-benefit and
defined-contribution retirement plans. The Defined Benefit Retirement Income Plan for Certain Employees of American Multi-Cinema, Inc. ("AMC Defined Benefit Retirement Income Plan") and the AMC
401(k) Savings Plan are both tax-qualified retirement plans in which the Named Executive Officers participate on substantially the same terms as our other participating employees. However,
due to maximum limitations imposed by the Employee Retirement Income Security Act of 1974 ("ERISA") and the Internal Revenue Code on the annual amount of a pension which may be paid under a qualified
defined-benefit plan and on the maximum amount that may be contributed to a qualified defined-contribution plan, the benefits that would otherwise be payable to the Named Executive Officers under the
Defined Benefit Retirement Income Plan are limited. Because we did not believe that it was appropriate for the Named Executive Officers' retirement benefits to be reduced because of limits under ERISA
and the Internal Revenue Code, we had established non-qualified supplemental defined-benefit plans that permit the Named Executive Officers to receive the same benefit that would be paid
under our qualified defined-benefit plan up to the old IRS limit, as indexed, as if the Omnibus Budget Reconciliation Act of 1993 had not been in effect. On November 7, 2006, our Board of
Directors approved a proposal to freeze the AMC Defined Benefit Retirement Income Plan and our supplemental defined-benefit plans, the AMC Supplemental Executive Retirement Plan and the AMC Retirement
Enhancement Plan, effective as of December 31, 2006. The Compensation Committee determined that these types of plans are not as effective as other elements of compensation
in aligning executives' interests with the interests of shareholders, a particularly important consideration for a public company. As a result, the Compensation Committee determined to freeze these
plans. Benefits no longer accrue under the AMC Defined Benefit Retirement Income Plan, the AMC Supplemental Executive Retirement Plan or the AMC Retirement Enhancement Plan for our Named Executive
Officers or for other participants.

Effective
for fiscal year 2010, under the Company's 401(k) Savings Plan the Company matched 50% of each eligible employee's elective contributions up to 6% of the employee's eligible
compensation. Previously, the Company matched 100% of elective contributions up to 5% of employee compensation.

The
"Pension Benefits" table and related narrative section "Pension and Other Retirement Plans" below describes our qualified and non-qualified defined-benefit plans in which
our Named Executive Officers participate.

Non-Qualified Deferred Compensation Program

Named Executive Officers are permitted to elect to defer base salaries and their annual bonuses under the AMC Non-Qualified
Deferred Compensation Plan. We believe that providing the Named Executive Officers with deferred compensation opportunities is a cost-effective way to permit officers to receive the tax
benefits associated with delaying the income tax event on the compensation deferred, even though the related deduction for the Companies is also deferred.

The
"Non-Qualified Deferred Compensation" table and related narrative section "Non-Qualified Deferred Compensation Plan" below describe the
non-qualified deferred compensation plan and the benefits thereunder.

Severance and Other Benefits Upon Termination of Employment

We believe that severance protections, particularly in the context of a change in control transaction, can play a valuable role in
attracting and retaining key executive officers. Accordingly, we provide such protections for each of the Named Executive Officers and for other of our senior officers in their respective employment
agreements. The Compensation Committee evaluates the level of

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severance
benefits provided to Named Executive Officers on a case-by-case basis. We consider these severance protections consistent with competitive practices.

As
described in more detail below under "Potential Payments Upon Termination or Change in Control" pursuant to their employment agreements, each of the Named Executive Officers would be
entitled to severance benefits in the event of termination of employment by AMCE without cause and certain Named Executive Officers would be entitled to severance benefits due to death or disability.
In the case of Mr. Lopez, resignation for good reason would also entitle the employee to severance benefits. We have determined that it is appropriate to provide these executives with severance
benefits under these circumstances in light of their positions with AMCE and as part of their overall compensation package.

We
believe that the occurrence, or potential occurrence, of a change in control transaction will create uncertainty regarding the continued employment of our executive officers. This
uncertainty results from the fact that many change in control transactions result in significant organizational changes, particularly at the senior executive level. In order to encourage certain of
our executive officers to remain employed with us during an important time when their prospects for continued employment following the transaction are often uncertain, we provide the executives with
severance benefits if they terminate their employment within a certain number of days following specified changes in their compensation, responsibilities or benefits following a change in control. No
claim for severance due to a change in control has been made by an executive who is a party to an employment agreement providing for such severance benefits since the Marquee Transactions (then a
change in control for purposes of the agreements). The severance benefits for these executives are generally determined as if they continued to remain employed by us for two years following their
actual termination date.

Perquisites

The perquisites provided to each Named Executive Officer during fiscal 2010, 2009 and 2008 are reported in the All Other Compensation
column of the "Summary Compensation Table" below, and are further described in footnote (5) to that table. Perquisites consist of Company matching contributions under our 401(k) savings plan,
which is a qualified defined contribution plan, life insurance premiums, awards and gifts, relocation expenses, on-site parking, and an award of theatre chairs. Perquisites are benchmarked
and reviewed, revised and approved by the Compensation Committee every year.

Policy with Respect to Section 162(m)

Section 162(m) of the Internal Revenue Code generally disallows public companies a tax deduction for compensation in excess of
$1,000,000 paid to their chief executive officers and the four other most highly compensated executive officers unless certain performance and other requirements are met. Our intent generally is to
design and administer executive compensation programs in a manner that will preserve the deductibility of compensation paid to our executive officers, and we believe that a substantial portion of our
current executive compensation program (including the stock options and other awards that may be granted to our Named Executive Officers as described above) satisfies the requirements for exemption
from the $1,000,000 deduction limitation. However, we reserve the right to design programs that recognize a full range of performance criteria important to our success, even where the compensation
paid under such programs may not be deductible. The Compensation Committee will continue to monitor the tax and other consequences of our executive compensation program as part of its primary
objective of ensuring that compensation paid to our executive officers is reasonable, performance-based and consistent with the goals of AMCE and its stockholder.

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Compensation Committee Report on Executive Compensation

The Compensation Committee has certain duties and powers as described in its charter. The Compensation Committee is currently composed
of the four
non-employee directors named at the end of this report. The Compensation Committee has reviewed and discussed with management the disclosures contained in the above Compensation Discussion
and Analysis. Based upon this review and discussion, the Compensation Committee recommended to our Board of Directors that the Compensation Discussion and Analysis section be included in our Annual
Report on Form 10-K.

Compensation
Committee of the Board of Directors

Aaron
J. Stone
Stephen P. Murray
Eliot P.S. Merrill
Philip Loughlin

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Table of Contents

Summary Compensation Table

The following table presents information regarding compensation of our principal executive officer, our principal financial officer,
our three other most highly compensated executive officers for services rendered during fiscal 2010 as well as an additional executive officer whose compensation otherwise would have been subject to
reporting had there not been any option grants in fiscal 2010. These individuals are referred to as "Named Executive Officers."

Name and Principal Position(1)

Year

Salary
($)

Bonus
($)

Stock
Awards
($)

Option
Awards
($)(2)

Non-Equity
Incentive
Plan
Compensation
($)(3)

Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(4)

All Other
Compensation
($)(5)(6)

Total
($)Gerardo I. Lopez


2010

$
700,003

$
400,000

$


$


$
674,240

$


$
66,220

$
1,840,463Chief Executive


2009


64,615








2,068,847








16,570


2,150,032Officer, President and Director(Parent, Holdings, AMCE andAmerican Multi-Cinema, Inc.)Craig R. Ramsey


2010


385,000











346,847


83,470


6,656


821,973Executive Vice President


2009


383,508

















16,634


400,142and Chief Financial


2008


374,183

















29,365


403,548Officer (Parent, Holdings,AMCE and AmericanMulti-Cinema, Inc.)John D. McDonald


2010


385,000











344,344


134,080


9,419


872,843Executive Vice President


2009


383,508

















21,626


405,134North American


2008


374,182

















28,356


402,538Operations (Parent, Holdings,AMCE and AmericanMulti-Cinema, Inc.)Robert J. Lenihan


2010


376,885








138,833


252,838





48,762


817,318President, Film Programming(Parent, Holdings, AMCE andAmerican Multi-Cinema, Inc.)Kevin M. Connor


2010


325,000











260,520


12,201


8,205


605,926Senior Vice President,


2009


323,658

















16,123


339,781General Counsel and


2008


321,696

















25,230


346,926Secretary (Parent, Holdings,AMCE and AmericanMulti-Cinema, Inc.)Samuel D. Gourley


2010


287,500








92,962


230,460


169,091


40,393


820,406President, AMC FilmProgramming (Parent,Holdings, AMCE andAmerican Multi-Cinema, Inc.)


(1)The
principal positions shown are at April 1, 2010. Compensation for Mr. Gerardo Lopez, Mr. Robert Lenihan, and Mr. Samuel
Gourley is provided for years where they were Named Executive Officers only.(2)As
required by the SEC Rules, amounts shown in the column, "Option Awards," presents the aggregate grant date fair value of option awards granted in the
fiscal year in accordance with accounting rules ASC 718,CompensationStock Compensation. These amounts reflect the Company's accounting
expense and do not correspond to the actual value that will be realized by the Named Executive Officers. Options are to acquire shares of Parent common stock.
In
May 2009, Mr. Robert Lenihan and Mr. Samuel Gourley received a stock option grant to purchase 1,023 and 685 common shares, respectively, of Parent at a price equal to $339.59 per
share. The options will vest in five equal annual installments, subject to continued employment. The option shall expire after ten years from the date of the grant. The valuation assumptions used for
these option awards are provided in Note 1The Company and Significant Accounting Policies to the Company's Consolidated Financial Statements contained elsewhere in this Annual
Report on Form 10-K.

In
March 2009, Mr. Gerardo Lopez received a stock option grant to purchase 15,980.45 common shares of Parent at a price equal to $323.95 per share. The options will vest in five equal annual
installments, subject to Mr. Lopez's continued employment. The option shall expire after ten years from the date of the grant. The valuation assumptions used for Mr. Lopez's option award
are provided in Note 1The Company and Significant Accounting Policies to the Company's Consolidated Financial Statements contained elsewhere in this Annual Report on
Form 10-K.

No
option awards were granted with regards to Named Executive Officers during fiscal 2008. No option awards granted to Named Executive Officers in the above table were forfeited in fiscal 2010, fiscal
2009 or fiscal 2008.


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Table of Contents

(3)The
Compensation Committee has determined the amounts of the annual incentive plan compensation that will be paid to each Named Executive Officer for fiscal
2010. We expect to pay those amounts during the first quarter of fiscal 2011. No bonuses were earned in fiscal 2009 and 2008 under the annual incentive bonus program as the Company did not meet the
minimum targeted adjusted EBITDA threshold established by the Compensation Committee. Further discussion on the annual incentive bonus program for the Named Executive Officers can be found in the Compensation Discussion and
AnalysisAnnual Performance Bonussection.(4)The
following table represents the aggregate increases and decreases in actuarial present value of each officer's accumulated benefit amounts. The aggregate
decreases in actuarial present value amounts have been omitted from the Summary Compensation Table:


Defined
Benefit Plan

Supplemental
Executive
Retirement
PlanCraig R. Ramsey


2010

$
42,764

$
22,1732009


(2,109
)

(1,094
)2008


(3,426
)

(1,776
)John D. McDonald


2010


87,134


45,1792009


(35,248
)

(18,276
)2008


(13,050
)

(6,766
)Kevin M. Connor


2010


8,635


3,5662009


(4,394
)

(1,814
)2008


(1,849
)

(3,567
)Samuel D. Gourley


2010


113,326


55,765


For
fiscal 2009, in accordance with the amended guidance for employers' accounting for defined benefit pension and other postretirement plans in Accounting Standards Codification
715, Compensation-Retirement Benefits,the measurement date used to measure the aggregate change in actuarial present value of accumulated benefit amounts
was changed from a measurement date of January 1 to the Company's fiscal year end date, ending on April 2, 2009. See Note 11Employee Benefit Plans to the Company's
Consolidated Financial Statements contained elsewhere in this Annual Report on Form 10-K for more information.

This
column includes above market earnings for the difference between market interest rates determined pursuant to SEC rules and the 19.7% to 21.6% interest contingently credited by the Company on
salary deferred by the Named Executive Officers under the nonqualified deferred salary plan. For fiscal 2010, above market earnings for Mr. Ramsey and Mr. McDonald were $18,533 and
$1,767, respectively. There were no above market earnings under the nonqualified deferred compensation plan for the Named Executive Officers for fiscal 2009 and 2008. Further discussion on the
nonqualified deferred compensation for the Named Executive Officers can be found in theCompensation Discussion and AnalysisNonqualified
Deferred Compensation section. (5)All
Other Compensation is comprised of Company matching contributions under our 401(k) savings plan which is a qualified defined contribution plan, life
insurance premiums, automobile related benefits, awards / gifts, relocation expenses, on-site parking, and an award of theatre chairs. The following table summarizes "All Other
Compensation" provided to the Named Executive Officers:


Additional All Other CompensationPerquisites and Other Personal Benefits

Company
Matching
Contributions
to 401(k)
PlanCar
Allowance

Awards/Gifts

Theatre
Chairs

Relocation
Expenses

On-Site
Parking

Life Insurance
PremiumsGerardo I. Lopez


2010

$


$
100

$


$
64,326

$


$


$
1,7942009











16,570








Craig R. Ramsey


2010





100











3,202


3,3542009


1,500


305











11,475


3,3542008


13,500


254











12,128


3,483John D. McDonald


2010





1,500











6,125


1,7942009


1,500


305











18,027


1,7942008


13,500


254











12,739


1,863Robert J. Lenihan


2010











45,883


170





2,709Kevin M. Connor


2010

















7,125


1,0802009


1,350


305


2,366








11,061


1,0412008


12,150


254











11,781


1,045Samuel D. Gourley


2010





1,502





31,107


170


4,900


2,714




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Table of Contents

Compensation of Named Executive Officers

The Summary Compensation Table above quantifies the value of the different forms of compensation earned by or awarded to our Named
Executive Officers in fiscal 2010. The primary elements of each Named Executive Officer's total compensation reported in the table are base salary and annual bonus.

The
Summary Compensation Table should be read in conjunction with the tables and narrative descriptions that follow. A description of the material terms of each Named Executive Officer's
base salary and annual bonus is provided below.

The
"Pension Benefits" table and related description of the material terms of our pension plans describe each Named Executive Officer's retirement benefits under the Companies'
defined-benefit pension plans to provide context to the amounts listed in the Summary Compensation Table. The discussion in the section "Potential Payments Upon Termination or Change in Control"
explains the potential future payments that may become payable to our Named Executive Officers.

Description of Employment AgreementsSalary and Bonus Amounts

We have entered into employment agreements with each of Messrs. Lopez, Ramsey, McDonald, Lenihan, Connor, and Gourley.
Provisions of these agreements relating to outstanding equity incentive awards and post-termination of employment benefits are discussed below.

Gerardo I. Lopez.On February 23, 2009, AMC Entertainment entered into an employment agreement with Gerardo I. Lopez to serve as
its Chief
Executive Officer. The term of the agreement is for three years, with automatic one-year extensions each year. The agreement provides that Mr. Lopez will receive an initial
annualized base salary of $700,000. The Compensation Committee, based on its review, has discretion to increase (but not reduce) the base salary each year. Mr. Lopez target incentive bonus for
fiscal 2010 was equal to 70% of his annual base salary. In addition, Mr. Lopez is receiving a one-time special incentive bonus that vests at the rate of $400,000 per year over five
years, effective March 2009, provided he remains employed on each vesting date. The first three installments of the special incentive bonus are payable on the third anniversary and the fourth and
fifth installments are payable upon vesting. Upon approval by the Compensation Committee, Mr. Lopez received a grant of options to purchase 15,980.45 shares of the common stock of AMCEH. The
options will vest in five equal annual installments, subject to Mr. Lopez's continued employment. In making its determination with respect to salary and bonus levels, the Compensation Committee
considers the factors discussed in the "Current Executive Compensation Program Elements" of the Compensation Discussion and Analysis above. The agreement also provides that Mr. Lopez will be
eligible for benefits offered by the Company to other executive officers and will be entitled to reimbursements for expenses reasonably incurred in connection with related business expenses and
travel. Change in control, severance arrangements and restrictive covenants in Mr. Lopez's employment agreement are discussed in detail below in the narrative section "Potential Payments Upon
Termination or Change in Control."

Craig R. Ramsey.On July 1, 2001, AMC and AMCE entered into an employment agreement with Craig R. Ramsey who serves as the
Executive Vice
President and Chief Financial Officer of the Company and reports directly to AMCE's Chairman of the Board, President and Chief Executive Officer. The term of the agreement is for two years, with
automatic one-year extensions each year. The agreement provides that Mr. Ramsey will receive an initial annualized base salary of $275,000 subject to review by the Chairman of the
Board, President and Chief Executive Officer of AMCE and, if applicable, the Compensation Committee. Based on their review, the Chairman of the Board, President and Chief Executive Officer of AMCE
and, if applicable, the Compensation Committee have discretion to increase (but not reduce) the base salary each year. The agreement also provides for annual bonuses for Mr. Ramsey based on the
applicable incentive compensation program of the company and consistent with the determination of the Chairman of the Board, President and Chief Executive Officer

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Table of Contents

of
AMCE and, if applicable, the Compensation Committee. In making its determination with respect to salary and bonus levels, the Compensation Committee considers the factors discussed in the "Current
Executive Compensation Program Elements" of the Compensation Discussion and Analysis above. In addition, the agreement provides that Mr. Ramsey will be eligible for benefits offered by the
Company to other executive officers and will be entitled to reimbursements for expenses reasonably incurred in connection with business travel and entertainment. Change in control and severance
arrangements in Mr. Ramsey's employment agreement are discussed in detail below in the narrative section "Potential Payments Upon Termination or Change in Control."

John D. McDonald.On July 1, 2001, AMC and AMC Entertainment entered into an employment agreement with John D. McDonald, who serves
as an
Executive Vice President, North America Operations. Mr. McDonald reports directly to AMC's President and Chief Operating Officer or such officer's designee. The term of the agreement is for two
years, with automatic one-year extensions each year. The agreement provides that Mr. McDonald will receive an initial annualized base salary of $275,000, subject to review by the
President and Chief Financial Officer of AMC with the approval of AMC Entertainment's Chairman of the Board, President and Chief Executive Officer and, if applicable, the Compensation Committee. Based
on their review, the President and Chief Financial Officer of AMC with the approval of AMC Entertainment's Chairman of the Board, President and Chief Executive Officer and, if applicable, the
Compensation Committee have discretion to increase (but not reduce) the base salary each year. The agreement also provides for annual bonuses for Mr. McDonald based on the applicable incentive
compensation program of the Company and consistent with the determination of the President and Chief Financial Officer of AMC with the approval of AMC Entertainment's Chairman of the Board, President
and Chief Executive Officer and, if applicable, the Compensation Committee. In making its determination with respect to salary and bonus levels, the Compensation Committee considers the factors
discussed in the "Current Executive Compensation Program Elements" of the Compensation Discussion and Analysis above. In addition, the agreement provides that Mr. McDonald will be eligible for
benefits offered by the Company to other executive officers and will be entitled to reimbursements for expenses reasonably incurred in connection with business travel and entertainment. Change in
control and severance arrangements in Mr. McDonalds' employment agreements are discussed in detail below in the narrative section "Potential Payments Upon Termination or Change in Control."

Robert J. Lenihan.On April 7, 2009, AMC Entertainment entered into an employment agreement with Robert J. Lenihan who serves as
the President
of Film Programming. The term of the agreement is for two years, with automatic one-year extensions each year. The agreement provides that Mr. Lenihan will receive an initial
annualized base salary of $410,000 subject to review by the Board or the Compensation Committee. Based on their review, the Board or the Compensation Committee have discretion to increase (but not
reduce) the base salary each year. The agreement also provides for annual bonuses for Mr. Lenihan based on the applicable incentive compensation program of the Company and consistent with the
determination of the Chairman of the Board, President and Chief Executive Officer of AMCE and, if applicable, the Compensation Committee. The target incentive bonus for each fiscal year during the
period of employment shall equal 50% of the base salary. In making its determination with respect to salary and bonus levels, the Committee considers the factors discussed in the "Current Executive
Compensation Program Elements" of the Compensation Discussion and Analysis above. In addition, the agreement provides that Mr. Lenihan will be eligible for benefits offered by the Company to
other executive officers and will be entitled to reimbursements for expenses reasonably incurred in connection with carrying out the Executive's duties for the Company. Change in control and severance
arrangements in Mr. Lenihan's employment agreement are discussed in detail below in the narrative section "Potential Payments Upon Termination or Change in Control."

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Table of Contents

Kevin M. Connor.On November 6, 2002, AMC and AMC Entertainment entered into an employment agreement with Kevin M. Connor who
serves as the
Senior Vice President, General Counsel and Secretary of the Company. The term of the agreement is for two years, with automatic one-year extensions each year. The agreement provides that
Mr. Connor will receive an initial annualized base salary of $225,000 subject to review by the Chairman of the Board, President and Chief Executive Officer of AMCE and, if applicable, the
Compensation Committee. Based on their review, the Chairman of the Board, President and Chief Executive Officer of AMCE and, if applicable, the Compensation Committee have discretion to increase (but
not reduce) the base salary each year. The agreement also provides for annual bonuses for Mr. Connor based on the applicable incentive compensation program of the Company and consistent with
the determination of the Chairman of the Board, President and Chief Executive Officer of AMCE and, if applicable, the Compensation Committee. In making its determination with respect to salary and
bonus levels, the Committee considers the factors discussed in the "Current Executive Compensation Program Elements" of the Compensation Discussion and Analysis above. In addition, the agreement
provides that Mr. Connor will be eligible for benefits offered by the Company to other executive officers and will be entitled to reimbursements for expenses reasonably incurred in connection
with business travel and entertainment. Change in control and severance arrangements in Mr. Connor's employment agreement are discussed in detail below in the narrative section "Potential
Payments Upon Termination or Change in Control."

Samuel D. Gourley.On July 1, 2001, AMC Entertainment and American Multi-Cinema Entertainment
entered into an employment agreement with Samuel D. Gourley who serves as the President of AMC Film Programming. The term of the agreement is for one year, with automatic one-year
extensions each year. The agreement provides that Mr. Gourley will receive an initial annualized base salary of $197,608 plus an additional $17,500 on an annual basis as a market allowance
subject to review by the President, AMC Film Marketing and EVP North America Film Operations, with the approval of AMC's President and Chief Operating Officer. The agreement also provides for annual
bonuses for Mr. Gourley based on the applicable incentive compensation program of the Company and consistent with the determination of the Chairman of the Board, President and Chief Executive
Officer of AMCE and, if applicable, the Compensation Committee. In making its determination with respect to salary and bonus levels, the Committee considers the factors discussed in the "Current
Executive Compensation Program Elements" of the Compensation Discussion and Analysis above. In addition, the agreement provides that Mr. Gourley will be eligible for benefits offered by the
Company to other executive officers and will be entitled to reimbursements for expenses reasonably incurred in connection with business travel and entertainment. Change in control and severance
arrangements in Mr. Gourley's employment agreement are discussed in detail below in the narrative section "Potential Payments Upon Termination or Change in Control."

Grants of Plan-based AwardsFiscal 2010

The following table summarizes equity awards granted to named executive officers during fiscal 2010:

All Other
Stock
Awards:
Number of
Shares of
Stock or
Units
(#)

All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards

Estimated Future Payouts
Under Equity Incentive
Plan Awards

Exercise
Or Base
Price of
Option
Awards
($/Sh)

Grant Date
Fair Value
of Stock
and
Option
AwardsName

Grant Date

Threshold
($)

Target
($)

Maximum
($)

Threshold
($)

Target
($)

Maximum
($)Robert J. Lenihan


05/28/2009

$


$


$


$


$


$






1,023

$
339.59

$
138,833Samuel D. Gourley


05/28/2009

$


$


$


$


$


$






685

$
339.59

$
92,962


On May 28, 2009, Mr. Lenihan and Mr. Gourley received a grant of stock options to purchase 1,023 and 685 shares, respectively
of Class N Common Stock of AMCEH at a price equal to $339.59 per share. The options will vest in five equal annual installments, subject to their continued

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Table of Contents

employment.
The options shall expire after ten years from the date of the grant. The Company accounts for stock options using the fair value method of accounting and has elected to use the simplified
method for estimating the expected term for "plain vanilla" share option grants as it does not have enough historical experience to provide a reasonable estimate. See
Note 8Stockholder's Equity to the Company's Consolidated Financial Statements contained elsewhere in this Annual Report on Form 10-K for more information.

Outstanding Equity Awards at end of Fiscal 2010

The following table presents information regarding the outstanding equity awards held by each of our Named Executive Officers as of
April 1, 2010, including the vesting dates for the portions of these awards that had not vested as of that date:

Option Awards

Stock AwardsName

Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable

Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable

Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)

Option
Exercise
Price
($)

Option
Expiration
Date

Number
of Shares
or Units
of Stock
That Have
Not Vested
(#)

Market
Value of
Shares or
Units of
Stock
That Have
Not Vested
(#)

Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested
(#)

Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
($)Gerardo I. Lopez(1)


3,196.09000


12,784.36000




$
323.95


03/06/2019











Craig R. Ramsey(2)(3)


4,092.28723








491.00


12/23/2014











John D. McDonald(2)(3)


2,046.14362








491.00


12/23/2014











Robert J. Lenihan(4)





1,023.00000





339.59


05/28/2019











Kevin M. Connor(2)(3)


2,046.14362








491.00


12/23/2014











Samuel D. Gourley(4)





685.00000





339.59


05/28/2019














(1)The
options vest at a rate of 20% per year commencing on March 6, 2010. Options are to acquire shares of Parent common stock.(2)The
options vest at a rate of 20% per year commencing on December 23, 2005. Options are to acquire shares of Parent common stock.(3)The
option exercise price per share of $1,000 was adjusted to $491 per share pursuant to the anti-dilution provisions of the 2004 Stock Option
Plan to give effect to the payment of a one-time nonrecurring dividend paid by Parent on June 15, 2007 of $652,800,000 to the holders of its 1,282,750 shares of common stock.(4)The
options vest at a rate of 20% per year commencing on May 28, 2010. Options are to acquire shares of Parent common stock. Options are to acquire
shares of Parent common stock.


Option Exercises and Stock VestedFiscal 2010

None of our Named Executive Officers exercised options or held any outstanding stock awards during fiscal 2010.

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Pension Benefits

The following table presents information regarding the present value of accumulated benefits that may become payable to the Named
Executive Officers under our qualified and nonqualified defined-benefit pension plans.

Name

Plan Name

Number of
Years Credited
Service
(#)

Present Value
of Accumulated
Benefit(1)
($)

Payments
During Last
Fiscal Year
($)Gerardo I. Lopez






$


$
Craig R. Ramsey

Defined Benefit Retirement Income Plan


12.00


179,849


Supplemental Executive Retirement Plan


12.00


93,250


John D. McDonald

Defined Benefit Retirement Income Plan


31.05


317,871


Supplemental Executive Retirement Plan


31.05


164,814


Robert J. Lenihan










Kevin M. Connor

Defined Benefit Retirement Income Plan


4.00


27,596


Supplemental Executive Retirement Plan


4.00


11,396


Samuel D. Gourley

Defined Benefit Retirement Income Plan


31.80


476,600


Supplemental Executive Retirement Plan


31.80


234,524





(1)The
accumulated benefit is based on service and earnings considered by the plans for the period through April 1, 2010. It includes the value of
contributions made by the Named Executive Officers throughout their careers. The present value has been calculated assuming the Named Executive Officers will remain in service until age 65, the age at
which retirement may occur without any reduction in benefits, and that the benefit is payable under the available forms of annuity consistent with the plans. The interest assumption is 6.16%. The
post-retirement mortality assumption is based on the 2010 IRS Prescribed Mortality-Static Annuitant, male and female mortality table. See Note 11Employee Benefit Plans
to the Company's Consolidated Financial Statements contained elsewhere in this Annual Report on Form 10-K for more information.


Pension and Other Retirement Plans

We provide retirement benefits to the Named Executive Officers under the terms of qualified and non-qualified
defined-benefit plans. The AMC Defined Benefit Retirement Income Plan is a tax-qualified retirement plan in which the Named Executive Officers participate on substantially the same terms
as our other participating employees. However, due to maximum limitations imposed by ERISA and the Internal Revenue Code on the annual amount of a pension which may be paid under a qualified
defined-benefit plan, the benefits that would otherwise be payable to the Named Executive Officers under the Defined Benefit Retirement Income Plan are limited. Because we did not believe that it was
appropriate for the Named Executive Officers' retirement benefits to be reduced because of limits under ERISA and the Internal Revenue Code, we have non-qualified supplemental
defined-benefit plans that permit the Named Executive Officers to receive the same benefit that would be paid under our qualified defined-benefit plan up to the old IRS limit, as indexed, as if the
Omnibus Budget Reconciliation Act of 1993 had not been in effect. On November 7, 2006, our Board of Directors approved a proposal to freeze the AMC Defined Benefit Retirement Income Plan, and
our supplemental plans, the AMC Supplemental Executive Retirement Plan and the AMC Retirement Enhancement Plan, effective as of December 31, 2006. As amended, benefits do not accrue after
December 31, 2006, but vesting continues for associates with less than five years of vesting service. The

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material
terms of the AMC Defined Benefit Retirement Income Plan, the AMC Supplemental Executive Retirement Plan and the AMC Retirement Enhancement Plan are described below.

AMC Defined Benefit Retirement Income Plan.The AMC Defined Benefit Retirement Income Plan is a non-contributory defined-benefit pension
plan subject to the provisions of ERISA. As mentioned above, the plan was frozen effective December 31, 2006.

The
plan provides benefits to certain of our employees based upon years of credited service and the highest consecutive five-year average annual remuneration for each
participant. For purposes of calculating benefits, average annual compensation is limited by Section 401(a)(17) of the Internal Revenue Code, and is based upon wages, salaries and other amounts
paid to the employee for personal services, excluding certain special compensation. Under the defined benefit plan, a participant earns a vested right to an accrued benefit upon completion of five
years of vesting service.

AMC Supplemental Executive Retirement Plan.AMC also sponsors a Supplemental Executive Retirement Plan to provide the same level of
retirement
benefits that would have been provided under the
retirement plan had the federal tax law not been changed in the Omnibus Budget Reconciliation Act of 1993 to reduce the amount of compensation which can be taken into account in a qualified retirement
plan. The plan was frozen, effective December 31, 2006, and no new participants can enter the plan and no additional benefits can accrue thereafter.

Subject
to the forgoing, any individual who is eligible to receive a benefit from the AMC Defined Benefit Retirement Income Plan after qualifying for early, normal or late retirement
benefits thereunder, the amount of which is reduced by application of the maximum limitations imposed by the Internal Revenue Code, is eligible to participate in the Supplemental Executive Retirement
Plan.

The
benefit payable to a participant equals the monthly amount the participant would receive under the AMC Defined Benefit Retirement Income Plan without giving effect to the maximum
recognizable compensation for qualified retirement plan purposes imposed by the Internal Revenue Code, as amended by Omnibus Budget Reconciliation Act of 1993, less the monthly amount of the
retirement benefit actually payable to the participant under the AMC Defined Benefit Retirement Income Plan, each as calculated as of December 31, 2006. The benefit is an amount equal to the
actuarial equivalent of his/her benefit, computed by the formula above, payable in either a lump sum (in certain limited circumstances, specified in the plan) or equal semi-annual
installments over a period of two to ten years, with such form, and, if applicable, period, having been irrevocably elected by the participant.

If
a participant's employment with AMC terminates for any reason (or no reason) before the earliest date he/she qualifies for early, normal or late retirement benefits under the AMC
Defined Benefit Retirement Income Plan, no benefit is payable under the Supplemental Executive Retirement Plan.

AMC Retirement Enhancement Plan.AMC has established a Retirement Enhancement Plan for the benefit of officers who from time to time may
be
designated as eligible participants therein by the Board of Directors. As mentioned above, the plan was frozen, effective December 31, 2006, and no new participants can enter the plan and no
additional benefits can accrue thereafter. There are no active participants or Named Executive Officers in the plan.

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Nonqualified Deferred Compensation

The following table presents information regarding the contributions to and earnings on the Named Executive Officers' deferred
compensation balances during fiscal 2010, and also shows the total deferred amounts for the Named Executive Officers at the end of fiscal 2010:

Name

Executive
Contributions
in Last FY
($)

Registrant
Contributions
in Last FY
($)(1)

Aggregate
Earnings in
Last FY
($)

Aggregate
Withdrawals/
Distributions
($)

Aggregate
Balance at
Last FYE
($)Gerardo I. Lopez

$


$
400,000

$


$


$
400,000Craig R. Ramsey


11,550





24,530





137,887John D. McDonald


10,661





2,414





14,636Robert J. Lenihan














Kevin M. Connor














Samuel D. Gourley

















(1)The
activity for Mr. Lopez reflects the vested portion of his Special Incentive Bonus.


Non-Qualified Deferred Compensation Plan

AMC permits the Named Executive Officers and other key employees to elect to receive a portion of their compensation reported in the
Summary Compensation Table on a deferred basis. Deferrals of compensation during fiscal 2010 and in recent years have been made under the AMC Non-Qualified Deferred Compensation Plan.
Participants of the plan are able to defer annual salary and bonus (excluding commissions, expense reimbursement or allowances, cash and non-cash fringe benefits and any stock-based
incentive compensation). Amounts deferred under the plans are credited with an investment return determined as if the participant's account were invested in one or more investment funds made available
by the Committee and selected by the participant. AMC may, but need not, credit the deferred compensation account of any participant with a discretionary or profit sharing credit as determined by AMC.
The deferred compensation account will be distributed either in a lump sum payment or in equal annual installments over a term not to exceed 10 years as elected by the participant and may be
distributed pursuant to in-service withdrawals pursuant to certain circumstances. Any such payment shall commence upon the date of a "Qualifying Distribution Event" (as such term is
defined in the Non-Qualified Deferred Compensation Plan). The Qualifying Distribution Events are designed to be compliant with Section 409A of the Internal Revenue Code.

Pursuant
to his employment agreement, Mr. Gerardo Lopez is entitled to a one-time special incentive bonus of $2,000,000 that vests at the rate of $400,000 per year
over five years, effective March 2009, provided that he remains employed on each vesting date. The first three installments of the special incentive bonus are payable on the third anniversary and the
fourth and fifth installments are payable upon vesting. The special incentive bonus of $2,000,000 shall immediately vest in full upon Mr. Lopez's involuntary termination within twelve months
after a change of control, as defined in the employment agreement. As of April 1, 2010, Mr. Lopez has vested in one-fifth, or $400,000, of this special incentive bonus to be
paid on his third anniversary.

Potential Payments Upon Termination or Change in Control

The following section describes the benefits that may become payable to certain Named Executive Officers in connection with a
termination of their employment with Parent and/or a change in control of Parent, changes in responsibilities, salary or benefits. In addition to the benefits described below, outstanding equity-based
awards held by our Named Executive Officers may also be subject to accelerated vesting in connection with a change in control of Holdings under the terms of our 2004 Stock Option Plan. Furthermore,
upon a termination following a "Change of Control" (as such term is

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defined
in the AMC Retirement Enhancement Plan), the Named Executive Officer is entitled to his accrued benefits payable thereunder in a form of payment that he has previously chosen. The Retirement
Enhancement Plan and the present value of benefits accumulated under the plan are described above in the table "Pension Benefits" and the accompanying narrative "Pension and Other Retirement Plans."

Assumptions.As prescribed by the SEC's disclosure rules, in calculating the amount of any potential payments to the Named Executive
Officers under
the arrangements described below, we have assumed that the applicable triggering event (i.e., termination of employment and/or change in control of Holdings) occurred on the last business day
of fiscal 2010 and that the price per share of our common stock is equal to the fair market value of a share of our common stock as of that date.

Gerardo I. Lopez

Mr. Lopez's employment agreement, described above under "Employment AgreementsSalary and Bonus Payments," provides
for certain benefits to be paid to Mr. Lopez in connection with a termination of his employment with AMC Entertainment Inc. under the circumstances described below.

Severance Benefits.In the event Mr. Lopez's employment is terminated as a result of an involuntary termination during the
employment term by
AMC Entertainment without cause pursuant to a termination for death, "Disability", or by Mr. Lopez pursuant to a termination for "Good Reason" or
after a "Change of Control" (as those terms are defined in the employment agreement), Mr. Lopez will be entitled to severance pay equal to two times the sum of his base salary plus the average
of each Incentive Bonus paid to the Executive during the 24 months preceding the severance date (or previous year, if he has not been employed for two bonus cycles as of the severance date). If
his employment is terminated before determination of the first Incentive Bonus for which he is eligible under the agreement, then the amount shall be based upon the average actual percentage of target
bonus paid to executive officers who participated in the Company's annual bonus plan in the preceding year. In addition, upon such a qualifying termination, the stock options granted pursuant to the
employment agreement shall vest in full. The special incentive bonus equal to $2,000,000, which vests in equal annual installments over five years, shall immediately vest and be paid in full
upon the involuntary termination of employment within twelve months after a change of control.

If
Mr. Lopez had terminated employment with us on April 1, 2010 pursuant to his employment agreement under the circumstances described in the preceding paragraph, we
estimate that he would have been entitled to a cash payment equal to $1,400,000. This amount is derived by multiplying two by the sum of $700,000, which represents Mr. Lopez's annualized base
salary rate in effect on April 1, 2010. Additionally, Mr. Lopez would have been entitled to accelerated vesting of unvested stock options with a grant date fair value of $2,068,847
(based on a Black Sholes formula as of March 6, 2009). The special incentive bonus of $2,000,000 shall immediately vest and be paid in full upon Mr. Lopez's involuntary termination
within twelve months after a change of control.

Other Named Executive Officers

The employment agreements for each of the other Named Executive Officers, described above under "Employment
AgreementsSalary and Bonus Payments," provide for certain benefits to be paid to the executive in connection with a termination of his employment with AMC or AMC Entertainment under the
circumstances described below and/or a change in control of AMC or AMC Entertainment.

Severance Benefits.In the event the executive's employment is terminated during the employment term as a result of the executive's
death or
"Disability" or by AMC or AMC Entertainment pursuant to a "Termination Without Cause" or by the executive following certain changes in his responsibilities,

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annual
base salary or benefits, the executive (or his personal representative) will be entitled to a lump cash severance payment equal to one or two years of his base salary then in effect.

Upon
a termination of employment with us on April 1, 2010 under the circumstances described in the preceding paragraph, we estimate that each Named Executive Officer (other than
Mr. Lopez) would have been entitled to a lump sum cash payment as follows: Mr. Craig Ramsey$770,000; Mr. John McDonald$770,000; Mr. Robert
Lenihan$820,000; Mr. Kevin Connor$650,000; and Mr. Samuel Gourley$287,500. These amounts are derived by multiplying two by the respective
executive's annualized base salary rate in effect on April 1, 2010, except for Mr. Gourley who would receive a lump sum amount equal to one year base salary plus the amount of any annual
market allowance. Mr. Lenihan is not entitled to severance benefits for an employment termination resulting from death or "Disability".

Restrictive Covenants.Pursuant to each Named Executive Officer's employment agreement, the executive has agreed not to disclose any
confidential
information of AMC or AMC Entertainment at any time during or after his employment with AMC/AMC Entertainment.

Director CompensationFiscal 2010

The following section presents information regarding the compensation paid during fiscal 2010 to members of our Board of Directors who
are not also our employees (referred to herein as "Non-Employee Directors"). The compensation paid to Mr. Gerardo I. Lopez, who is also an employee, is presented above in the
Summary Compensation Table and the related explanatory tables. Mr. Lopez did not receive additional compensation for his service as a director.

Non-Employee Directors

We paid our directors an annual cash retainer of $50,000, plus $1,500 for each meeting of the board of directors they attended in
person or by phone, plus $1,000 for each committee meeting they attended. We also reimbursed all directors for any out-of-pocket expenses incurred by them in connection with
their services provided in such capacity.

The
following table presents information regarding the compensation of our non-employee Directors in fiscal 2010:

Name

Fees
earned
or paid
in cash
($)

Stock
Awards
($)

Option
Awards
($)

Non-equity
Incentive
Plan
Compensation
($)

Changes in
Pension
Value and
Nonqualified
Deferred
Compensation
($)

All other
Compensation
($)

Total
($)Aaron J. Stone

$
59,000

$


$


$


$


$


$
59,000Dr. Dana B. Ardi

$
56,000
















$
56,000Stephen P. Murray

$
58,000
















$
58,000Stan Parker

$
60,000
















$
60,000Philip H. Loughlin

$
59,000
















$
59,000Eliot P. S. Merrill

$
57,000
















$
57,000Kevin Maroni

$
59,000
















$
59,000Travis Reid

$
60,000
















$
60,000


Compensation Committee Interlocks and Insider Participation

The Compensation Committee members whose names appear on the Compensation Committee Report were committee members during all of fiscal
2010. No member of the Compensation Committee is or has been a former or current executive officer of the Company or has had any

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relationships
requiring disclosure by the Company under the SEC's rules requiring disclosure of certain relationships and related-party transactions. None of the Company's executive officers served as
a director or a member of a compensation committee (or other committee serving an equivalent function) of any other entity that has one or more executive officers serving on our Board of Directors or
on the Compensation Committee during the fiscal year ended April 1, 2010.

Risk Oversight

The Board executes its oversight responsibility for risk management directly and through its Committees, as follows:

The
Audit Committee has primary responsibility for overseeing the Company's Enterprise Risk Management, or "ERM", program. The Company's Director of Reporting and Control, who reports to
the Committee quarterly, facilitates the ERM program with consideration given to our Annual Operating Plan and with direct input obtained from the Senior Leadership Team, or "SLT"the
heads of our principal business and corporate functionsand their direct reports, under the executive sponsorship of our Executive Vice President and Chief Financial Officer and our Vice
President and Chief Accounting Officer. The Committee's meeting agendas include discussions of individual risk areas throughout the year, as well as an annual summary of the ERM process.

The
Board's other Committeesoversee risks associated with their respective areas of responsibility. For example, the Compensation Committee considers the risks associated
with our compensation policies and practices, with respect to both executive compensation and compensation generally. The Board of Directors is kept abreast of its Committees' risk oversight and other
activities via reports of the Committee Chairmen to the full Board. These reports are presented at every regular Board meeting and include discussions of Committee agenda topics, including matters
involving risk oversight.

The
Board considers specific risk topics, including risks associated with our Annual Operating Plan and our capital structure. In addition, the Board receives detailed regular reports
from the members of our SLT that include discussions of the risks and exposures involved in their respective areas of responsibility. Further, the Board is routinely informed of developments that
could affect our risk profile or other aspects of our business.

Policies and Practices as They Relate to Risk Management

The Compensation Committee believes the elements of the Company's executive compensation program effectively link performance-based
compensation to financial goals and shareholder interests without encouraging executives to take unnecessary or excessive risks in the pursuit of those objectives. The Compensation Committee believes
that the overall mix of compensation elements is appropriately balanced and does not encourage the taking of short-term risks at the expense of long-term results.
Long-term incentives for our executives are awarded in the form of equity instruments reflecting, or valued by reference to, our common stock. Long-term incentive awards are
generally made on an annual basis and are subject to a multi-year vesting schedule which helps ensure that award recipients always have significant value tied to long-term
stock price performance. The Compensation Committee believes that the combination of granting the majority of long-term incentives in the form of option awards, together with the Company
stock actually owned by our executives, appropriately links the long-term interests of executives and shareholders, and balances the short-term nature of annual incentive cash
bonuses and any incentives for undue risk-taking in our other compensation arrangements.

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Item 12.    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

All of the issued and outstanding capital stock of AMCE is owned by Holdings, and all of the issued and outstanding capital stock of
Holdings is owned by Parent. Parent has common stock issued and outstanding. The table below sets forth certain information regarding beneficial ownership of the common stock of Parent held as of
May 31, 2010 by (i) each of its directors and our Named Executive Officers, (ii) all directors and executive officers of Parent as a group and (iii) each person known by
Parent to own beneficially more than 5% of Parent common stock. Parent believes that each individual or entity named has sole investment and voting power with respect to shares of common stock of
Parent as beneficially owned by them, except as otherwise noted.

Name and Address

Shares of
Class A-1
Common
Stock

Shares of
Class A-2
Common
Stock

Shares of
Class N
Common
Stock

Shares of
Class L-1
Common
Stock

Shares of
Class L-1
Common
Stock

Percentage
of
OwnershipJ.P. Morgan Partners (BHCA), L.P. and Related Funds(1)(2)


249,225.00
(2)

249,225.00
(2)










38.98
%Apollo Investment Fund V, L.P. and Related Funds(3)(4)


249,225.00
(4)

249,225.00
(4)










38.98
%Bain Capital Investors, LLC and Related Funds(5)(6)











96,743.45


96,743.45


15.13
%The Carlyle Group Partners III Loews, L.P. and Related Funds(7)(8)











96,743.45


96,743.45


15.13
%Spectrum Equity Investors IV. L.P. and Related Funds(9)(10)











62,598.71


62,598.71


9.79
%Gerardo I. Lopez(11)(12)








385.86








*Craig R. Ramsey(11)(13)








153.00








*John D. McDonald(11)(14)








127.00








*Robert J. Lenihan (11)(15)

















*Kevin M. Connor(11)(16)








51.00








*Samuel D. Gourley(11)(17)

















*Dr. Dana B. Ardi(1)

















*Stephen P. Murray(1)

















*Stan Parker(18)

















*Aaron J. Stone(18)

















*Philip H. Loughlin(5)(6)

















*Eliot P. S. Merrill(7)

















*Kevin Maroni(9)(19)

















*Travis Reid(18)








728.77








*All directors and executive officers as a group (17 persons)








16,120.64








*


*less
than 1%(1)Represents
18,012.61 shares of Class A-1 common stock and 18,012.61 shares of Class A-2 common stock owned by J.P.
Morgan Partners Global Investors, L.P., 7,712.95 shares of Class A-1 common stock and 7,712.95 shares of Class A-2 common stock owned by J.P. Morgan
Partners


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Global
Investors Cayman, L.P., 1,011.31 shares of Class A-1 common stock and 1,011.31 shares of Class A-2 common stock owned by J.P. Morgan Partners Global
Investors Cayman II, L.P., 2,767.70 shares of Class A-1 common stock and 2,767.70 shares of Class A-2 common stock owned by AMCE (Ginger), L.P.,
1,330.19 shares of Class A-1 common stock and 1,330.19 shares of Class A-2 common stock owned by AMCE (Luke), L.P., 2,881.66 shares of
Class A-1 common stock and 2,881.66 shares of Class A-2 common stock owned by J.P. Morgan Partners Global Investors (Selldown), L.P., 3,217.09 shares of
Class A-1 common stock and 3,217.09 shares of Class A-2 common stock owned by AMCE (Scarlett), L.P., 12,661.15 shares of Class A-1
common stock and 12,661.15 shares of Class A-2 common stock owned by J.P. Morgan Partners Global Investors (Selldown) II, L.P., 1,253.55 shares of
Class A-1 common stock and 1,253.55 shares of Class A-2 common stock owned by J.P. Morgan Partners Global Fund/AMC /Selldown II, L.P., 7,260.06 shares of
Class A-1 common stock and 7,260.06 shares of Class A-2 common stock owned by J.P. Morgan Partners Global Investors (Selldown) II-C, L.P.,
(collectively, the "Global Investor Funds") and 75,141.71 shares of Class A-1 common stock and 75,141.71 shares of Class A-2 common stock owned by J.P. Morgan
Partners (BHCA), L.P. ("JPMP BHCA"). The general partner of the Global Investor Funds is JPMP Global Investors, L.P. ("JPMP Global"). The general partner of JPMP BHCA is JPMP Master Fund
Manager, L.P. ("JPMP MFM"). The general partner of JPMP Global and JPMP MFM is JPMP Capital Corp. ("JPMP Capital"), a wholly owned subsidiary of JPMorgan Chase & Co., a publicly
traded company ("JPM Chase"). Each of JPMP Global, JPMP MFM and JPMP Capital may be deemed, pursuant to Rule 13d-3 under the Exchange Act, to beneficially own the shares held by the
Global Investor Funds and JPMP BHCA.

Mr. Stephen
P. Murray is a Managing Director and Managing Director, President and Chief Executive Officer, respectively, of CCMP Capital Advisors, LLC a private equity firm comprised of
the former buyout/growth equity professionals of J.P. Morgan Partners who separated from JPM Chase to form an independent private equity platform. Dr. Dana B. Ardi is the Managing Director and
Founder of Corporate Anthropology Advisors, LLC, a consulting company that provides human capital advisory and innovative solutions that build value through organizational design and people
development. Through her company, Dr. Ardi has taken the role of Executive Advisor to CCMP Capital Advisors, LLC, a private equity firm formed in August 2006 by the former buyout/growth
equity investment team of J.P. Morgan Partners, LLC a private equity division of JPMorgan Chase & Co. Each of Dr. Ardi and Mr. Murray disclaims any beneficial
ownership of any shares beneficially owned by the J.P. Morgan Partners entities, except to the extent of his pecuniary interest therein. JPMP Capital exercises voting and dispositive power over the
securities held by the Global Investor Funds and JPMP BHCA. Voting and disposition decisions at JPMP Capital are made by three or more of its officers, and therefore no individual officer of JPMP
Capital is the beneficial owner of the securities. The address of Dr. Ardi is 211 Central Park West, New York, New York 10024. The address of Mr. Murray is c/o CCMP Capital
Advisors, LLC, 245 Park Avenue, New York, New York 10167, and the address of each of the JPMorgan Partners entities is c/o J.P. Morgan Partners, LLC, 270 Park Avenue, New York, New York
10017, except that the address of each Cayman entity is c/o Walkers SPV Limited, PO Box 908 GT, Walker House, George Town, Grand Cayman, Cayman Islands. Each of the Global Investor Funds, JPMP
BHCA, JPMP Global, JPMP MFM and JPMP Capital are part of the J.P. Morgan Partners private equity business unit of JPM Chase. J.P. Morgan Partners is one of our Sponsors. (2)Includes
115,975 shares of Class A-1 common stock and 115,975 shares of Class A-2 common stock of certain
co-investors, which, pursuant to a voting agreement, must be voted by such co-investors to elect JPMP designees for Parent's board of directors.(3)Represents
shares owned by the following group of investment funds: (i) 114,328.50 shares of Class A-1 common stock and 114,328.50
shares of Class A-2 common stock owned by Apollo Investment Fund V, L.P.; (ii) 14,997.29 shares of Class A-1 common stock and 14,997.29 shares of


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Class A-2
common stock owned by Apollo Overseas Partners V, L.P.; (iii) 1,572.35 shares of Class A-1 common stock and 1,572.35 shares of
Class A-2 common stock owned by Apollo Netherlands Partners V(A), L.P.; (iv) 1,108.64 shares of Class A-1 common stock and 1,108.64 shares of
Class A-2 common stock owned by Apollo Netherlands Partners V(B), L.P.; and (v) 1,243.22 shares of Class A-1 common stock and 1,243.22 shares of
Class A-2 common stock owned by Apollo German Partners V GmbH & Co. KG (collectively, the "Apollo Funds"). Apollo Advisors V, L.P. ("Advisors V") is the
general partner or the managing general partner of each of the Apollo Funds. Apollo Capital Management V, Inc. ("ACM V") is the general partner of Advisors V. Apollo Management V, L.P.
("Management V") serves as the day-to-day manager of each of the Apollo Funds. AIF V Management, LLC ("AIF V LLC") is the general partner of Management V and
Apollo Management, L.P. ("Apollo Management") is the sole member and manager of AIF V LLC. Each of Advisors V, ACM V, Management V, AIF V LLC and Apollo Management disclaim
beneficial ownership of all shares of common stock owned by the Apollo Funds. The address of the Apollo Funds, Advisors V, Management V, AIF V LLC and Apollo Management is c/o Apollo
Management, L.P., Two Manhattanville Road, Suite 203, Purchase, New York 10017.

Leon
Black, Joshua Harris and Marc Rowan effectively have the power to exercise voting and investment control over ACM V, with respect to the shares held by the Apollo Funds. Each of
Messrs. Black, Harris and Rowan disclaim beneficial ownership of such shares. (4)Includes
115,975 shares of Class A-1 common stock and 115,975 shares of Class A-2 common stock of certain
co-investors, which, pursuant to a voting agreement, must be voted by such co-investors to elect Apollo designees to Parent's board of directors.(5)Represents
shares owned by the following group of investment funds associated with Bain: (i) 64,255.29 shares of Class L-1 common
stock and 64,255.29 shares of Class L-2 common stock owned by Bain Capital (Loews) I Partnership, whose administrative member is Bain Capital (Loews) L, L.L.C., whose general
partners are Bain Capital (Loews) A Partnership, Bain Capital (Loews) L Partnership and Bain Capital (Loews) P Partnership, each of whose general partners are (x) Bain Capital Holdings (Loews)
I, L.P., whose general partner is Bain Capital Partners VII, L.P., whose general partner is Bain Capital Investors, LLC ("BCI") and (y) Bain Capital AIV (Loews)
II, L.P., whose general partner is Bain Capital Partners VIII, L.P., whose general partner is BCI and (ii) 32,488.16 shares of Class L-1 common stock and
32,488.16 shares of Class L-2 common stock owned by Bain Capital AIV (Loews) II, L.P., whose general partner is Bain Capital Partners VIII, L.P., whose general partner
is BCI. The address of Mr. Connaughton and each of the Bain entities is c/o Bain Capital Partners, LLC, 111 Huntington Avenue, Boston, Massachusetts 02199.
BCI,
by virtue of the relationships described above, may be deemed to have voting or investment control with respect to the shares held by each of the Bain entities. BCI disclaims beneficial ownership
of such shares.(6)Voting
and investment control over the shares held by Bain Capital (Loews) I Partnership and Bain Capital AIV (Loews) II, L.P. is exercised by the
investment committee of BCI. Members of the investment committee are Andrew B. Balson, Steven W. Barnes, Joshua Bekenstein, Edward W. Conard, John P. Connaughton, Paul B. Edgerley, Jordan Hitch,
Matthew S. Levin, Ian K. Loring, Philip Loughlin, Mark E. Nunnelly, Stephen G. Pagliuca, Michael Ward and Stephen M. Zide, each of whom disclaims beneficial ownership of the shares.(7)Represents
shares owned by the following group of investment funds affiliated with Carlyle: (i) 91,610.60 shares of Class L-1
common stock and 91,610.60 shares of Class L-2 common stock owned by Carlyle Partners III Loews, L.P., whose general partner is TC Group III, L.P., whose general
partners is TC Group III, L.L.C., whose sole managing member is TC Group, L.L.C.,


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whose
sole managing member is TCG Holdings, L.L.C. and (ii) 5,132.86 shares of Class L-1 common stock and 5,132.86 shares of Class L-2 common stock owned
by CP III Coinvestment, L.P., whose general partner is TC Group III, L.P., whose general partner is TC Group III, L.L.C., whose sole managing member is TC Group, L.L.C., whose sole
managing member is TCG Holdings, L.L.C. Mr. Merrill is a Managing Director of the Carlyle Group, and in such capacity, may be deemed to share beneficial ownership of the shares of common stock
held by investment funds associated with or designated by the Carlyle Group. Mr. Merrill expressly disclaims beneficial ownership of the shares held by the investment funds associated with or
designated by the Carlyle Group. The address of Mr. Merrill and the Carlyle Group is c/o The Carlyle Group, 520 Madison Avenue, 42nd floor, New York, New York 10022. (8)Voting
and investment control over the shares held by Carlyle Partners III Loews, L.P. and CP III Coinvestment, L.P. is exercised by the
three- person managing board of TCG Holdings, L.L.C. Members of this managing board are William E. Conway, Jr., Daniel A. D'Aniello and David M. Rubenstein, each of whom disclaims beneficial ownership
of the shares.(9)Represents
shares owned by the following group of investment funds affiliated with Spectrum: (i) 61,503.23 shares of Class L-1
common stock and 61,503.23 shares of Class L-2 common stock owned by Spectrum Equity Investors IV, L.P., whose general partner is Spectrum Equity Associates IV, L.P.,
(ii) 363.07 shares of Class L-1 common stock and 363.07 shares of Class L-2 common stock owned by Spectrum Equity Investors Parallel IV, L.P. whose
general partner is Spectrum Equity Associates IV, L.P., and (iii) 732.40 shares of Class L-1 common stock and 732.40 shares of Class L-2 common
stock owned by Spectrum IV Investment Managers' Fund, L.P. Kevin Maroni is a Senior Managing Director of Spectrum and disclaims beneficial ownership of any shares beneficially owned by
Spectrum. The address of Mr. Maroni and Spectrum Equity Investors is c/o Spectrum Equity Investors, One International Place, 29th Floor, Boston, Massachusetts 02110.
SpectrumEquity
Associates IV, L.P., by virtue of the relationships described above, may be deemed to have voting or investment control with respect to the shares held by Spectrum Equity
Investors IV, L.P. and Spectrum Equity Investors Parallel IV, L.P. Spectrum Equity Associates IV, L.P. disclaims beneficial ownership of such shares.(10)Voting
and investment control over the shares held by the Spectrum entities is exercised by the investment committees of Spectrum Equity Associates
IV, L.P. and Spectrum IV Investment Managers' Fund, L.P. Members of each of these investment committees are Brion B. Applegate, William P. Collatos, Benjamin M. Coughlin, Randy J.
Henderson, Michael J. Kennealy, Kevin J. Maroni, Christopher T. Mitchell and Victor E. Parker, each of whom disclaims beneficial ownership of the shares.(11)The
address of such person is c/o AMC Entertainment Holdings, Inc., 920 Main Street, Kansas City, Missouri 64105.(12)Includes
3,196.090000 shares underlying options.(13)Includes
4,092.287230 shares underlying options.(14)Includes
2,046.143620 shares underlying options.(15)Includes
204.60 shares underlying options.(16)Includes
2,046.143620 shares underlying options.(17)Includes
137.00 shares underlying options.(18)Although
each of Messrs Parker and Stone may be deemed a beneficial owner of shares of Holdings beneficially owned by Apollo due to his affiliation
with Apollo and its related investment managers and advisors, each such person disclaims beneficial ownership of any such shares. The


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address
of Messers, Parker and Stone is c/o Apollo Management, L.P., 9 West 57th Street, New York, New York 10019. (19)Includes
804.60 shares underlying options.


Equity Compensation Plan Information

The following is a summary of securities authorized for issuance under Parent's equity compensation plans as of April 1, 2010.

Number of shares to be
issued upon exercise of
outstanding options,
warrants and rights

Weighted average of exercise
price of outstanding
options, warrants and rights

Number of securities
remaining available for
future issuance under equity
compensation plans(1)Equity compensation plans approved by security holders


31,597.168095

$
383.58


9,325.7042495Equity compensation plans not approved by security holders








Total


31,597.168095

$
383.58


9,325.7042495


(1)These
shares are available under the 2004 Stock Option Plan of Parent. The number of shares shown is as of April 1, 2010.




Item 13.    Certain Relationships and Related Transactions and Director Independence.

The Company seeks to ensure that all transactions with related parties are fair, reasonable and in their best interest. In this regard,
generally the board of directors or one of the committees reviews material transactions between the Company and related parties to determine that, in their best business judgment, such transactions
meet that standard. The Company believes that each of these transactions was on terms at least as favorable to it as could have been obtained from an unaffiliated third party. Set forth below is a
description of certain transactions which have occurred since April 3, 2009 or which involve obligations that remain outstanding as of April 1, 2010.

Parent
is owned by the Sponsors, other co-investors and by certain members of management as follows: JPMP (20.839%); Apollo (20.839%); Bain Capital Partners (15.13%); The
Carlyle Group (15.13%); Spectrum Equity Investors (9.79%); Weston Presidio Capital IV, L.P. and WPC Entrepreneur Fund II, L.P. (3.91%); Co-Investment Partners, L.P.
(3.91%); Caisse de Depot et Placement du Quebec (3.128%); AlpInvest Partners CS Investments 2003 C.V., AlpInvest Partners Later Stage Co-Investments Custodian II B.V. and AlpInvest
Partners Later Stage Co-Investments Custodian IIA B.V. (2.737%); SSB Capital Partners (Master Fund) I, L.P. (1.955%); CSFB Strategic Partners Holdings II, L.P., CSFB
Strategic Partners Parallel Holdings II, L.P., and GSO Credit Opportunities Fund (Helios), L.P. (1.564%); Credit Suisse Anlagestiftung, Pearl Holding Limited, Vega Invest (Guernsey)
Limited and Partners Group Private Equity Performance Holding Limited (0.782%); Screen Investors 2004, LLC (0.152%); and current and former members of management (0.134%)(1).

For
a description of certain employment agreements between us and Messrs. Gerardo I. Lopez, John D. McDonald, Craig R. Ramsey, Kevin M. Connor and Mark A. McDonald see
Item 11Executive Compensation.

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Governance Agreements

In connection with the holdco merger, Parent, Holdings, the Sponsors and the other former continuing stockholders of Holdings, as
applicable, entered into various agreements defining the rights of Parent's stockholders with respect to voting, governance and ownership and transfer of the stock of Parent, including an Amended and
Restated Certificate of Incorporation of Parent, a Stockholders Agreement, a Voting Agreement among Parent and the former continuing stockholders of Holdings, a Voting Agreement among Parent and the
BCS Investors and a Management Stockholders Agreement among Parent and certain members of management of Parent who are stockholders of Parent (collectively, the "Governance Agreements").

The
Governance Agreements provide that the Board of Directors for Parent, Holdings and the Company will consist of up to nine directors, two of whom shall be designated by JPMP, two of
whom shall be designated by Apollo, one of whom shall be the Chief Executive Officer of Parent, one of whom shall be designated by The Carlyle Group, one of whom shall be designated by Bain Capital
Partners, one of whom shall be designated by Spectrum Equity Investors and one of whom shall be designated by Bain Capital Partners, The Carlyle Group and Spectrum Equity Investors, voting together,
so long as such designee is consented to by each of Bain Capital Partners and The Carlyle Group. Each of the directors respectively designated by JPMP, Apollo, The Carlyle Group, Bain Capital Partners
and Spectrum Equity Investors shall have three votes on all matters placed before the Board
of Directors of Parent, Holdings and AMCE and each other director will have one vote each. The number of directors respectively designated by the Sponsors will be reduced upon transfers by such
Sponsors of ownership in Holdings below certain thresholds.

The
Voting Agreement among Parent, and the pre-existing stockholders of Holdings provides that, until the fifth anniversary of the holdco merger ("Blockout Period"), the stockholders of
Holdings (other than Apollo and JPMP) will generally vote their voting shares of capital stock of Parent in favor of any matter in proportion to the shares of capital stock of Apollo and JPMP voted in
favor of such matter, except in certain specified instances. The Voting Agreement among Parent and the BCS Investors further provide that during the Blockout Period, the BCS Investors will generally
vote their voting shares of capital stocks of Parent on any matter as directed by any two of The Carlyle Group, Bain Capital Partners and Spectrum Equity Investors, except in certain specified
instances. In addition, certain actions of Parent, Holdings and/or actions of ours, including, but not limited to, change in control transactions, acquisition or disposition transactions with a value
in excess of $10,000,000, the settlement of claims or litigation in excess of $2,500,000, an initial public offering of Parent, hiring or firing a chief executive officer, chief financial officer or
chief operating officer, incurring or refinancing indebtedness in excess of $5,000,000 or engaging in new lines of business, require the approval of either (i) any three of JPMP, Apollo, The
Carlyle Group or Bain Capital Partners or (ii) Spectrum Equity Investors and (a) either JPMP or Apollo and (b) either The Carlyle Group or Bain Capital Partners (the "Requisite
Stockholder Majority") if at such time they hold at least a majority of Parent's voting shares.

Prior
to the earlier of the end of the Blockout Period and the completion of an initial public offering of the capital stock of Parent, Holdings or AMCE (an "IPO"), the Governance
Agreements prohibit the Sponsors and the other former stockholders of Parent from transferring any of their interests in Parent, other than certain permitted transfers to affiliates or to persons
approved of by the Sponsors. Following the end of the Blockout Period, the Sponsors may transfer their shares subject to the rights described below.

The
Governance Agreements set forth additional transfer provisions for the Sponsors and the other former stockholders of Holdings with respect to the interests in Parent, including the
following:

Right of first offer.After the Blockout Date and prior to an IPO, Parent and, in the event Parent does not exercise its right of first
offer, each
of its stockholders, has a right of first offer to purchase

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(on
a pro rata basis in the case of the stockholders) all or any portion of the shares of Parent that a stockholder is proposing to sell to a third party at the price and on the terms and conditions
offered by such third party.

Drag-along rights.If, prior to an IPO, Sponsors constituting a Requisite Stockholder Majority propose to transfer shares of Parent to
an
independent third party in a bona fide arm's-length transaction or series of transactions that results in a sale of all or substantially all of Parent or us, such Sponsors may elect to require each of
the other stockholders of Parent to transfer to such third party all of its shares at the purchase price and upon the other terms and subject to the conditions of the sale.

Tag-along rights.Subject to the right of first offer described above, if any stockholder proposes to transfer shares of Parent held by
it, then such stockholder shall give notice to each other stockholder, who shall each have the right to participate on a pro rata basis in the proposed transfer on the terms and conditions offered by
the proposed purchaser.

Participant rights.On or prior to an IPO, the Sponsors have the pro rata right to subscribe to any issuance by Parent or any subsidiary
of shares of
its capital stock or any securities exercisable, convertible or exchangeable for shares of its capital stock, subject to certain exceptions.

The
Governance Agreements also provide for certain registration rights in the event of an initial public offering of Parent, including the following:

Demand rights.Subject to the consent of at least two of any of JPMP, Apollo, The Carlyle Group and Bain Capital Partners during the
first two years
following an IPO, each Sponsor has the right at any time following an IPO to make a written request to Parent for registration under the Securities Act of part or all of the registrable equity
interests held by such stockholders at Parent's expense, subject to certain limitations. Subject to the same consent requirement, the non-Sponsor stockholders of Parent as a group shall
have the right at any time following an IPO to make one written request to Parent for registration under the Securities Act of part or all of the registrable equity interests held by such stockholders
with an aggregate offering price to the public of at least $200,000,000.

Piggyback rights.If Parent at any time proposes to register under the Securities Act any equity interests on a form and in a manner
which would
permit registration of the registrable equity interests held by stockholders of Parent for sale to the public under the Securities Act, Parent shall give written notice of the proposed registration to
each stockholder, who shall then have the right to request that any part of its registrable equity interests be included in such registration, subject to certain limitations.

Holdback agreements.Each stockholder has agreed that it will not offer for public sale any equity interests during a period not to
exceed
90 days (180 days in the case of the IPO) after the effective date of any registration statement filed by Parent in connection with an underwritten public offering (except as part of
such underwritten registration or as otherwise permitted by such underwriters), subject to certain limitations.

Amended and Restated Fee Agreement

In connection with the holdco merger, Parent, Holdings, AMCE and the Sponsors entered into a Fee Agreement, which provides for an
annual management fee of $5,000,000, payable quarterly and in advance to each Sponsor, on a pro rata basis, until the twelfth anniversary from December 23, 2004, and such time as the Sponsors
own less than 20% in the aggregate of Parent. In addition, the fee agreement provides for reimbursements by AMCE to the Sponsors for their out-of-pocket expenses and to Parent
of up to $3,500,000 for fees payable by Parent in any single fiscal year in order to maintain its corporate existence, corporate overhead expenses and salaries or other compensation of certain
employees.

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Upon
the consummation of a change in control transaction or an initial public offering, each of the Sponsors will receive, in lieu of quarterly payments of the annual management fee, a
fee equal to the net present value of the aggregate annual management fee that would have been payable to the Sponsors during the remainder of the term of the fee agreement (assuming a twelve year
term from the date of the original fee agreement), calculated using the treasury rate having a final maturity date that is closest to the twelfth anniversary of the date of the original fee agreement
date. As of April 1, 2010, the Company estimates this amount would be $29,190,000 should a change in control transaction or an IPO occur.

The
fee agreement also provides that AMCE will indemnify the Sponsors against all losses, claims, damages and liabilities arising in connection with the management services provided by
the Sponsors under the fee agreement.

DCIP

In February 2007, Mr. Travis Reid was hired as the chief executive officer of DCIP, a joint venture between AMCE, Cinemark USA
and Regal formed to implement digital cinema in our theatres and to create a financing model and establish agreements with major motion picture studios for the implementation of digital cinema.
Mr. Reid is a member of the Company's Board of Directors.

On
March 10, 2010 DCIP completed its financing transactions for the deployment of digital projection systems to nearly 14,000 movie theatre screens across North America, including
screens operated or managed by AMC Entertainment Inc., Cinemark Holdings, Inc. ("Cinemark") and Regal Entertainment Group ("Regal"). At closing the Company contributed 342 projection
systems that it owned to DCIP which were recorded at estimated fair value as part of an additional investment in DCIP of $21,768,000. The Company also made cash investments in DCIP of $840,000 at
closing and DCIP made a distribution of excess cash to us after the closing date and prior to year-end of $1,262,000. The Company recorded a loss on contribution of the 342 projection
systems of $563,000, based on the difference between estimated fair value and its carrying value on the date of contribution. On March 26, 2010 the Company acquired 117 digital projectors from
third party lessors for $6,784,000 and sold them together with seven digital projectors that it owned to DCIP for $6,570,000. The Company recorded a loss on the sale of these 124 systems to DCIP of
$697,000. As of April 1, 2010, the Company operated 568 digital projection systems leased from DCIP pursuant to operating leases and anticipates that it will have deployed 4,000 of these
systems in its existing theatres over the next three to four years. The additional digital projection systems will allow the Company to add additional 3D screens to its circuit where the
Company is generally able to charge a higher admission price than 2D.

Market Making Transactions

On August 18, 2004, Holdings sold $304,000,000 in aggregate principal amount at maturity of its Discount Notes due 2014. On
June 9, 2009, AMCE sold $600,000,000 in aggregate principal amount of its Senior Notes due 2019. On January 26, 2006, AMCE sold $325,000,000 in aggregate principal amount of its Notes
due 2016. JP Morgan Securities Inc., an affiliate of J.P. Morgan Partners, LLC which owns approximately 20.8% of Holdings, was an initial purchaser of these notes. Credit Suisse
Securities (USA) LLC, whose affiliates own approximately 1.6% of Parent, was also an initial purchaser of these notes.

AMCE Dividend to Holdings

On April 3, 2008, the Company declared and made distributions to or for the benefit of Holdings in the amount of $21,830,000
which has been recorded by the Company as a reduction to additional paid-in capital. The distribution included $3,279,000 of advances made by the Company on behalf of

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Holdings
prior to fiscal 2008 and $18,551,000 of cash advances made during fiscal 2008, including payment of interest on the Holdings Discount Notes due 2014 of $14,447,700. In connection with the
holdco merger, AMCE paid a dividend to Holdings of $275,000,000 which has been recorded by the Company as a reduction to additional paid-in capital.

During
fiscal 2009, AMCE used cash on hand to pay dividend distributions to Holdings in an aggregate amount of $35,989,000. Holdings and Parent used the available funds to make cash
interest payments on the Holdco Notes, repurchase treasury stock and make payments related to the liability classified options, and pay corporate overhead expenses incurred in the ordinary course of
business.

During
April and May of 2009, AMCE made dividend payments to its stockholder, Holdings, and Holdings made dividend payments to its stockholder, Parent, totaling $300,000,000, which were
treated as a reduction of additional paid-in capital. Parent made payments to purchase term loans and reduced the principal balance of its Parent Term Loan Facility from $466,936,000 to
$193,290,000 with a portion of the dividend proceeds.

During
September of 2009 and March of 2010, AMCE used cash on hand to pay a dividend distribution to Holdings in an aggregate amount of $15,351,000 and $14,630,000, respectively.
Holdings and Parent used the available funds to make a cash interest payment on the Holdco Notes and pay corporate overhead expenses incurred in the ordinary course of business.

Director Independence

As of May 7, 2010, our Board of Directors was comprised of Dana B. Ardi, Gerardo I. Lopez, Phillip H.
Loughlin, Kevin Maroni, Eliot P. S. Merrill, Stephen P. Murray, Stan Parker, Travis Reid and Aaron J. Stone. We have no securities listed for trading on a national
securities exchange or in an automated inter-dealer quotation system of a national securities association which
has requirements that a majority of our board of directors be independent. For purposes of complying with the disclosure requirements of the Securities and Exchange Commission, we have adopted the
definition of independence used by the New York Stock Exchange. Under the New York Stock Exchange's definition of independence, none of our directors are independent.

Item 14.    Principal Accounting Fees and Services

Audit and Certain Other Fees Paid To Accountants

The following table shows the fees that AMC Entertainment was billed for the audit and other services provided by KPMG LLP for
fiscal year 2010 and by PricewaterhouseCoopers LLP for fiscal year 2009. The Audit Committee has considered whether the provision of such services is compatible with maintaining the
independence of KPMG LLP and PricewaterhouseCoopers LLP and determined they were compatible. The Audit Committee has the sole right to engage and terminate the Company's independent
registered public accounting firm, to pre-approve their performance of audit services and permitted non-audit services, and to approve all audit and non-audit fees.

Type of Fee

2010

2009Audit Fees

$
645,000

$
1,190,535Audit-Related Fees


117,190


707,797Tax Fees


186,039


All Other Fees





Total

$
948,229

$
1,898,332


The
Audit Committee has adopted policies and procedures for the pre-approval of audit services and permitted non-audit services to be performed by its independent
registered public accounting firm

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in
order to assure that the provision of such services does not impair the independent registered public accounting firm's independence. The policies provide general pre-approval for
certain types of services, as well as approved costs for those services. The term of any general pre-approval is 12 months from the date of pre-approval unless the Audit
Committee specifies otherwise. Any costs or services that are not given general pre-approval require specific pre-approval by the Audit Committee. The policy directs that, if
management must make a judgment as to whether a proposed service is a pre-approved service, management should seek approval of the Audit Committee before such service is performed.

Requests
to provide services that require specific approval by the Audit Committee must be submitted to the Audit Committee by both the independent auditor and management, and must
include a joint statement as to whether, in their view, the request or application is consistent with the SEC's rules on auditor independence.

The
policies provide thatde minimisservices, consisting of audit- related, tax and other services, which were not recognized by the
Company to be non-audit services at the time the outside auditor was engaged to perform them are permitted. However, the aggregate amount of all such services may not exceed more than the
lesser of 5% of annual fees paid to the outside auditor or $50,000 for a particular engagement. Thesede minimisservices may be performed without
pre-approval, provided that they are approved by the Audit Committee or delegated member prior to completion of the engagement and are otherwise provided in accordance with regulations
issued pursuant to the Sarbanes-Oxley Act of 2002.

Audit Fees

This category includes the audit of the Company's annual financial statements, review of financial statements included in the Company's
Quarterly Reports on Form 10-Q and services that are normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings or
engagements for the fiscal years.

Audit-Related Fees

This category consists of assurance and related services by KPMG LLP and PricewaterhouseCoopers LLP that are reasonably related
to the performance of the audit or review of the Company's financial statements and are not reported above under "Audit Fees." The services for the fees disclosed under this category include other
accounting, consulting, including due diligence services, and employee benefit plan audits.

Tax Fees

This category consists of professional services rendered by KPMG LLP and PricewaterhouseCoopers LLP for tax preparation and tax
compliance.

All Other Fees

This category consists of services rendered by KPMG LLP and PricewaterhouseCoopers LLP for technical tax advice.

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PART IV

Item 15.    Exhibits, Financial Statement Schedules

(a)(1)    The following financial statements are included in Part II Item 8:



PageReports of Independent Registered Public Accounting Firms


48Consolidated Statements of OperationsPeriods ended April 1, 2010, April 2, 2009 and
April 3, 2008


50Consolidated Balance SheetsApril 1, 2010 and April 2, 2009


51Consolidated Statements of Cash FlowsPeriods ended April 1, 2010, April 2, 2009 and
April 3, 2008


52Consolidated Statements of Stockholder's Equity (Deficit)Periods ended April 1, 2010, April 2,
 2009 and April 3, 2008


53Notes to Consolidated Financial StatementsPeriods ended April 1, 2010, April 2, 2009 and
April 3, 2008


55(a)(2)    Financial Statement SchedulesAll schedules
have been omitted because the necessary information is included in the Notes to the Consolidated Financial Statements.(b)    ExhibitsA list of exhibits required to be filed as part of this report on
Form 10-K is set forth in the Exhibit Index, which immediately precedes such exhibits.(c)    Separate Financial Statements of Subsidiaries Not
ConsolidatedThe following financial statements of National CineMedia, LLC are as
follows:PageReport of Independent Registered Public Accounting Firm


149Balance SheetsJanuary 1, 2009 and December 31, 2009


150Statements of OperationsPeriods ended December 27, 2007, January 1, 2009 and December 31,
 2009


151Statements of Changes in Members' EquityPeriods ended December 27, 2007, January 1, 2009 and
December 31, 2009


152Statements of Cash FlowsPeriods ended December 27, 2007, January 1, 2009 and December 31,
 2009


153Notes to Financial StatementsAs of and for the periods ended December 27, 2007,
January 1, 2009 and December 31, 2009


155


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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To
the Board of Directors and Members of
National CineMedia, LLC
Centennial, Colorado

We
have audited the accompanying balance sheets of National CineMedia, LLC (the "Company") as of December 31, 2009 and January 1, 2009, and the related statements of
operations, members' equity (deficit), and cash flows for the years ended December 31, 2009 and January 1, 2009, the period February 13, 2007 through December 27, 2007, and
for the period December 29, 2006 through February 12, 2007. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits.

We
conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In
our opinion, such financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2009 and January 1, 2009, and
the results of its operations and its cash flows for the years ended December 31, 2009 and January 1, 2009, the period February 13, 2007 through December 27, 2007, and for
the period December 29, 2006 through February 12, 2007, in conformity with accounting principles generally accepted in the United States of America.

/s/
Deloitte & Touche LLP

Denver,
Colorado
March 9, 2010

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NATIONAL CINEMEDIA, LLC        BALANCE SHEETS        (In millions)

December 31, 2009

January 1, 2009ASSETSCURRENT ASSETS:Cash and cash equivalents

$
37.8

$
34.1Receivables, net of allowance of $3.6 and $2.6 million, respectively


89.0


92.0Prepaid expenses


1.5


1.6Prepaid management fees to managing member


0.6


0.5Total current assets


128.9


128.2PROPERTY AND EQUIPMENT, net of accumulated depreciation of $39.3 and $27.0 million, respectively


23.7


28.0INTANGIBLE ASSETS, net of accumulated amortization of $4.4 and $1.5 million, respectively


134.2


111.8OTHER ASSETS:Debt issuance costs, net


9.2


11.1Equity method investment


7.4


Other long-term assets


1.0


0.8Total other assets


17.6


11.9TOTAL

$
304.4

$
279.9LIABILITIES AND MEMBERS' EQUITY/(DEFICIT)CURRENT LIABILITIES:Amounts due to founding members


29.8


25.6Amounts due to managing member


22.9


22.1Accrued expenses


12.4


6.3Current portion of long-term debt


4.3


Accrued payroll and related expenses


6.6


5.7Accounts payable


11.3


11.2Deferred revenue and other current liabilities


2.8


3.4Total current liabilities


90.1


74.3OTHER LIABILITIES:Borrowings


799.0


799.0Interest rate swap agreements


54.6


87.7Other long-term liabilities


0.3


4.5Total other liabilities


853.9


891.2Total liabilities


944.0


965.5COMMITMENTS AND CONTINGENCIES (NOTE 9)MEMBERS' EQUITY/(DEFICIT)


(639.6
)

(685.6
)TOTAL

$
304.4

$
279.9


See
accompanying notes to financial statements.

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NATIONAL CINEMEDIA, LLC        STATEMENTS OF OPERATIONS        (In millions)

Year Ended
December 31,
2009

Year Ended
January 1,
2009

Period
February 13,
2007 through
December 27,
2007

Period
December 29,
2006 through
February 12,
2007REVENUE:Advertising (including revenue from founding members of $36.3, $43.3, $40.9 and $0 million, respectively)

$
335.1

$
330.3

$
282.7

$
20.6Administrative feesfounding members











0.1Fathom Events


45.5


38.9


25.4


2.9Other


0.1


0.3


0.2


Total


380.7


369.5


308.3


23.6OPERATING EXPENSES:Advertising operating costs


20.0


18.7


9.1


1.1Fathom Events operating costs


29.1


25.1


15.4


1.4Network costs


18.6


17.0


13.3


1.7Theatre access fees/circuit share costsfounding members


52.7


49.8


41.5


14.4Selling and marketing costs


50.2


47.9


40.9


5.2Administrative costs


14.8


14.5


10.0


2.8Administrative feemanaging member


10.8


9.7


9.2


Severance plan costs





0.5


1.5


0.4Depreciation and amortization


15.6


12.4


5.0


0.7Other costs


0.7


0.7


0.9


Total


212.5


196.3


146.8


27.7OPERATING INCOME (LOSS)


168.2


173.2


161.5


(4.1
)Interest Expense, Net:Borrowings


47.1


51.8


48.0


0.1Change in derivative fair value


(7.0
)

14.2





Interest income and other


(2.0
)

(0.2
)

(0.2
)

Total


38.1


65.8


47.8


0.1Impairment and related loss





11.5





INCOME (LOSS) BEFORE INCOME TAXES


130.1


95.9


113.7


(4.2
)Provision for Income Taxes


0.8


0.6





Equity loss from investment, net


0.8








NET INCOME (LOSS)

$
128.5

$
95.3

$
113.7

$
(4.2
)


See
accompanying notes to financial statements.

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NATIONAL CINEMEDIA, LLC        STATEMENTS OF MEMBERS' EQUITY/(DEFICIT)        (In millions)

TotalBalanceDecember 28, 2006

$
3.5Contribution of severance plan payments


0.4Net loss


(4.2
)BalanceFebruary 12, 2007

$
(0.3
)BalanceFebruary 13, 2007

$
(0.3
)Contribution of severance plan payments


1.5Capital contribution from managing member


746.1Capital contribution from founding member


11.2Distribution to managing member


(53.3
)Distribution to founding members


(1,521.6
)Reclassification of unit option plan


2.3Comprehensive Income:Unrealized (loss) on cash flow hedge


(14.4
)Net income


113.7Total Comprehensive Income


99.3Share-based compensation expense


1.0BalanceDecember 27, 2007

$
(713.8
)Contribution of severance plan payments


0.5Capital contribution from managing member


0.6Capital contribution from founding members


4.7Distribution to managing member


(55.5
)Distribution to founding members


(75.5
)Units issued for purchase of intangible asset


116.1Comprehensive Income:Unrealized (loss) on cash flow hedge


(59.1
)Net income


95.3Total Comprehensive Income


36.2Share-based compensation expense


1.1BalanceJanuary 1, 2009

$
(685.6
)Capital contribution from founding members


0.1Distribution to managing member


(57.8
)Distribution to founding members


(81.5
)Units issued for purchase of intangible asset


28.5Comprehensive Income:Unrealized (loss) on cash flow hedge


26.1Net income


128.5Total Comprehensive Income


154.6Share-based compensation expense


2.1BalanceDecember 31, 2009

$
(639.6
)


See
accompanying notes to financial statements.

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NATIONAL CINEMEDIA, LLC        STATEMENTS OF CASH FLOWS        (In millions)

Year Ended
December 31,
2009

Year Ended
January 1,
2009

Period
February 13,
2007 through
December 27,
2007

Period
December 29,
2006 through
February 12,
2007CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)

$
128.5

$
95.3

$
113.7

$
(4.2
)Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:Depreciation and amortization


15.6


12.4


5.0


0.7Non-cash severance plan and share-based compensation


2.0


1.5


2.5


0.7Non-cash impairment and related loss





11.5





Net unrealized hedging transactions


(7.0
)

14.2





Equity in losses from investment


0.8








Amortization of debt issuance costs


1.9


1.9


1.7


Changes in operating assets and liabilities:Receivablesnet


3.0


(0.4
)

(40.3
)

12.6Accounts payable and accrued expenses


6.9


(0.7
)

10.4


(4.4
)Amounts due to founding members and managing member


1.2


0.4


(51.1
)

(3.7
)Other


(3.5
)

0.1


(1.3
)

0.5Net cash provided by operating activities


149.4


136.2


40.6


2.2CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of property and equipment


(8.4
)

(16.6
)

(13.8
)

(0.5
)Increase in investment in affiliate


(2.0
)




(7.0
)

Other








(0.3
)

Net cash (used in) investing activities


(10.4
)

(16.6
)

(21.1
)

(0.5
)CASH FLOWS FROM FINANCING ACTIVITIES:Reimbursement (payment) of offering costs and fees








4.7


(0.1
)Proceeds from borrowings





139.0


924.0


13.0Repayments of borrowings


(3.0
)

(124.0
)

(150.0
)

(13.0
)Proceeds from managing member contributions





0.6


746.1


Proceeds from founding member contributions


3.6


9.7


7.5


Distribution to founding members and managing member


(135.9
)

(118.3
)

(1,538.0
)

Payment of debt issuance costs








(14.6
)

Net cash (used in) financing activities


(135.3
)

(93.0
)

(20.3
)

(0.1
)CHANGE IN CASH AND CASH EQUIVALENTS


3.7


26.6


(0.8
)

1.6CASH AND CASH EQUIVALENTS:Beginning of period


34.1


7.5


8.3


6.7End of period

$
37.8

$
34.1

$
7.5

$
8.3


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Table of Contents

NATIONAL CINEMEDIA, LLC

STATEMENTS OF CASH FLOWS (Continued)

(In millions)

Year Ended
December 31,
2009

Year Ended
January 1,
2009

Period
February 13,
2007 through
December 27,
2007

Period
December 29,
2006 through
February 12,
2007Supplemental disclosure of non-cash financing and investing activity:Contribution for severance plan payments




$
0.5

$
1.5

$
0.4Increase in distributions payable to founding members and managing member

$
53.1

$
49.7

$
37.0


Contributions from members collected after period end




$
0.4

$
3.7


Integration payment from founding member collected after period end

$
1.2

$
1.2





Purchase of an intangible asset with subsidiary equity

$
28.5

$
116.1





Settlement of put liability by issuance of debt

$
7.0








Assets acquired in settlement of put liability

$
2.5








Increase in property and equipment not requiring cash in the period







$
0.6


Unit option plan reclassified to equity







$
2.3


Supplemental disclosure of cash flow information:Cash paid for interest

$
38.8

$
48.3

$
44.0

$
0.1Cash paid for income taxes

$
0.8

$
0.6








See accompanying notes to financial statements.

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1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



National CineMedia, LLC ("NCM LLC" or "the Company") commenced operations on April 1, 2005 and operates the
largest digital in-theatre network in North America, allowing NCM LLC to distribute advertising, Fathom Business meeting services, and Fathom Consumer entertainment services under
long-term exhibitor services agreements ("ESAs") with American Multi-Cinema, Inc. ("AMC"), a wholly owned subsidiary of AMC Entertainment, Inc. ("AMCE"), Regal
Cinemas, Inc., a wholly owned subsidiary of Regal Entertainment Group ("Regal"), and Cinemark USA, Inc. ("Cinemark USA"), a wholly owned subsidiary of Cinemark Holdings, Inc.
("Cinemark"). AMC, Regal and Cinemark and their affiliates are referred to in this document as "founding members". NCM LLC also provides such services to certain third-party theater circuits
under multi-year network affiliate agreements, which expire at various dates.

NCM LLC
was formed through the combination of the operations of National Cinema Network, Inc. ("NCN"), a wholly owned subsidiary of AMCE, and Regal CineMedia Corporation
("RCM"), a wholly owned subsidiary of Regal. All assets contributed to and liabilities assumed by NCM LLC were recorded on NCM LLC's accounting records in the amounts as reflected on the
Members' historic accounting records, based on the application of accounting principles as provided in ASC Topic 805Business Combinations(formerly under Emerging Issues Task Force ("EITF") 98-4,Accounting by a Joint Venture for Businesses Received at its Formation). Although
legally structured as a limited liability company, NCM LLC was considered a joint venture for accounting purposes given the joint control provisions of the operating agreement among the
members, consistent with ASC Topic 323InvestmentsEquity Method and Joint Venture(formerly Accounting Principles Board
("APB") Opinion No. 18,The Equity Method of Accounting for Investments in Common Stock). RCM and NCN are each considered to be predecessors of
NCM LLC. Cinemark became a founding member on July 15, 2005 through units, which were issued to Cinemark Media, Inc. ("Cinemark Media"), a wholly owned subsidiary of Cinemark
USA, Inc.



On February 13, 2007, National CineMedia, Inc. ("NCM, Inc." or "managing member"), a Company formed by
NCM LLC and incorporated in the State of Delaware with the sole purpose of becoming a member and sole manager of NCM LLC, closed its initial public offering ("IPO"). NCM, Inc.
used the net proceeds from its IPO to purchase a 44.8% interest in NCM LLC, paying NCM LLC $746.1 million, which included reimbursement to NCM LLC for expenses the Company
advanced related to the NCM, Inc. IPO and paying the founding members $78.5 million for a portion of the NCM LLC units owned by them. NCM LLC paid $686.3 million of
the funds received from NCM, Inc. to the founding members as consideration for their agreement to modify the then-existing ESAs. Proceeds received by NCM LLC from
NCM, Inc. of $59.8 million, together with $709.7 million net proceeds from NCM LLC's new senior secured credit facility (see Note 6), entered into concurrently with
the completion of NCM, Inc.'s IPO were used to redeem $769.5 million in NCM LLC preferred units held by the founding members. The preferred units were
created immediately prior to the NCM, Inc. IPO in a non-cash recapitalization of each membership unit into one common unit and one preferred unit. Immediately prior to this
non-cash recapitalization, the existing common units and employee unit options (see Note 7) were split on a 44,291-to-1 basis. All unit and per unit amounts
in these financial statements reflect the impact of this split.

At
December 31, 2009, NCM LLC had 101,557,505 membership units outstanding, of which 42,121,747 (41.5%) were owned by NCM, Inc., 25,425,689 (25.0%) were owned by
RCM, 18,821,114 (18.5%) were owned by AMC, and 15,188,955 (15.0%) were owned by Cinemark.

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1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

In
connection with the completion of the NCM, Inc.'s IPO, NCM, Inc. and the founding members entered into a third amended and restated limited liability company operating
agreement of NCM LLC ("LLC Operating Agreement"). Under the LLC Operating Agreement, NCM, Inc. became a member and the sole manager of NCM LLC. As the sole manager,
NCM, Inc. is able to control all of the day to day business affairs and decision-making of NCM LLC without the approval of any other member. NCM, Inc. cannot be removed as manager
of NCM LLC. NCM LLC entered into a management services agreement with NCM, Inc. pursuant to which NCM, Inc. agrees to provide certain specific management services to
NCM LLC, including those services typically provided by the individuals serving in the positions of president and chief executive officer, president of sales and chief marketing officer,
executive vice president and chief financial officer, executive vice president and chief operations officer and executive vice president and general counsel. In exchange for the services,
NCM LLC reimburses NCM, Inc. for compensation and other expenses of the officers and for certain out-of-pocket costs (see Note 5). NCM LLC also
provides administrative and support services to NCM, Inc. such as office facilities, equipment, supplies, payroll and accounting and financial reporting. The management services agreement also
provides that NCM LLC employees may participate in the NCM, Inc. equity incentive plan (see Note 7). NCM LLC will indemnify NCM Inc. for any losses arising from
NCM Inc.'s performance under the management services agreement, except that NCM Inc. will indemnify NCM LLC for any losses caused by NCM Inc.'s willful misconduct or gross
negligence.

The
ESAs with the founding members were amended and restated in conjunction with the NCM, Inc. IPO. Subject to limited exceptions, under the ESAs NCM LLC is the exclusive
provider of advertising services to the founding members for a 30-year term (with a five-year right of first refusal commencing one year before the end of the term) beginning
February 13, 2007 and Fathom Events services to the founding members for an initial five-year term, with an automatic five-year renewal providing certain financial tests
are met. In exchange for the right to provide these services to the founding members, NCM LLC is required to pay to the founding members a theatre access fee which is a specified calculation
based on the attendance at the founding member theatres and the number of digital screens in founding member theatres. Prior to the NCM, Inc. IPO, NCM LLC paid to the founding members a
percentage of NCM LLC's advertising revenue as advertising circuit share. Upon the completion of the NCM, Inc. IPO, the founding members
made additional time available for sale by NCM LLC, subject to a first right to purchase the time, if needed, by the founding members to fulfill advertising obligations with their
in-theatre beverage concessionaries.



The Company has prepared its financial statements and related notes in accordance with accounting principles generally accepted in the
United States of America ("GAAP") and the rules and regulations of the Securities and Exchange Commission ("SEC").

The
Company's historical financial data may not be indicative of the Company's future performance nor will such data reflect what its financial position and results of operations would
have been had it operated as an independent company during the entirety of all periods presented. NCM, Inc.'s IPO was completed in February 2007. In addition, as a result of the various
related-party agreements discussed in Note 5, the operating results as presented are not necessarily indicative of the results that might have occurred if all agreements were with
non-related third parties.

The
founding members received all of the proceeds from NCM, Inc.'s IPO and the related issuance of debt, except for amounts needed to pay out-of-pocket
costs of the financings and other expenses, and $10.0 million to repay outstanding amounts under NCM LLC's then-existing revolving

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1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

line
of credit agreement. In conformity with accounting guidance of the SEC concerning monetary consideration paid to promoters, such as the founding members, in exchange for property conveyed by the
promoters, the excess over predecessor cost was treated as a special distribution. Because the founding members had no cost basis in the ESAs, all payments to the founding members with the proceeds of
NCM Inc.'s IPO and related debt, amounting to approximately $1.456 billion, have been accounted for as distributions, except for the payments to liquidate accounts payable to the
founding members arising from the ESAs. The distributions by NCM LLC to the founding members made at the date of NCM, Inc.'s IPO resulted in a stockholders' deficit.

The
results of operations for the period ended December 27, 2007 are presented in two periods, reflecting operations prior to and subsequent to NCM, Inc.'s IPO. The period
from December 29, 2006 through February 12, 2007 is referred to as the "2007 pre-IPO period". The period from February 13, 2007 through December 27, 2007 is
referred to as the "2007 post-IPO period". Separate periods have been presented because there were significant changes at the time of NCM, Inc.'s IPO including modifications to the
ESAs and related expenses thereunder, and significant changes to revenue arrangements and contracts with the founding members. The financial statements
for both the 2007 pre-IPO period and 2007 post-IPO period give effect to allocations of revenues and expenses made using relative percentages of founding member attendance or
days in each period, discrete events and other methods management considered a reasonable reflection of the results for such periods.



Accounting PeriodThe Company operates on a 52-week fiscal year, with the fiscal year ending on the first Thursday after
December 25, which, in certain years, results in a 53-week year, as was the case for fiscal year 2008.

EstimatesThe preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the
reporting period. Significant estimates include those related to the reserve for uncollectible accounts receivable and equity-based compensation. Actual results could differ from those estimates.

Segment ReportingSegments are accounted for under ASC Topic 280Segment Reporting(formerly
Statement
of Financial Accounting Standards ("SFAS") No. 131,Disclosures about Segments of an Enterprise and Related Information). Refer to
Note 11.

Revenue RecognitionAdvertising revenue is recognized in the period in which an advertising contract is fulfilled against the contracted theatre
attendees. Advertising revenue is recorded net of make-good provisions to account for delivered attendance that is less than contracted attendance. When remaining delivered attendance is
provided in subsequent periods, that portion of the revenue earned is recognized in that period. Deferred revenue refers to the unearned portion of advertising contracts. All deferred revenue is
classified as a current liability. Fathom Events revenue is recognized in the period in which the event is held.

Operating CostsAdvertising-related operating costs primarily include personnel and other costs related to advertising fulfillment, and to a
lesser
degree, production costs of non-digital advertising, and payments due to unaffiliated theatre circuits under the network affiliate agreements.

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Fathom
Events operating costs include equipment rental, catering, movie tickets acquired primarily from the founding members, revenue share under the amended and restated ESAs and other
direct costs of the meeting or event.

In
the 2007 pre-IPO period and prior periods, circuit share costs were fees payable to the founding members for the right to exhibit advertisements within the theatres, based
on a percentage of advertising revenue. In the 2007 post-IPO period and subsequent periods, under the amended and restated ESAs, a payment to the founding members of a theatre access fee,
in lieu of circuit share expense, comprised of a payment per theatre attendee and a payment per digital screen, both of which escalate over time, is reflected in expense.

Network
costs include personnel, satellite bandwidth, repairs, and other costs of maintaining and operating the digital network and preparing advertising and other content for
transmission across the digital network. These costs are not specifically allocable between the advertising business and the Fathom Events business.

LeasesThe Company leases various office facilities under operating leases with terms ranging from three to eight years. We calculate
straight-line rent expense over the initial lease term and renewals that are reasonably assured.

Advertising CostsCosts related to advertising and other promotional expenditures are expensed as incurred. Due to the nature of our business, we
have
an insignificant amount of advertising costs included in selling and marketing costs on the statement of operations.

Cash and Cash EquivalentsAll highly liquid debt instruments and investments purchased with an original maturity of three months or less are
classified as cash equivalents. These are cash balances in a bank in excess of the federally insured limits or in the form of a money market demand account with a major financial institution.

Restricted CashAt December 31, 2009 and January 1, 2009, other non-current assets included restricted cash of
$0.3 million, which secures a letter of credit used as a lease deposit on NCM LLC's New York office.

ReceivablesBad debts are provided for using the allowance for doubtful accounts method based on historical experience and management's evaluation
of
outstanding receivables at the end of the period. Receivables are written off when management determines amounts are uncollectible. Trade accounts receivable are uncollateralized and represent a large
number of geographically dispersed debtors. At December 31, 2009 there was one advertising agency group through which the Company sources national advertising revenue representing approximately
19% of the Company's outstanding gross receivable balance; however, none of the individual contracts related to the advertising agency were more than 10% of advertising revenue. At January 1,
2009, there was one client and one advertising agency group through which the Company sources national advertising revenue representing approximately 10% and 20%, respectively, of the Company's
outstanding gross receivable balance; however, none of the individual contracts related to the advertising agency were more than 10% of advertising revenue. The collectability risk is reduced by
dealing with large, national advertising agencies and clients who have strong reputations in the advertising industry and stable financial positions.

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Receivables
consisted of the following, in millions:

As of December 31,
2009

As of January 1,
2009Trade accounts

$
91.6

$
92.4Other


1.0


2.2Less allowance for doubtful accounts


(3.6
)

(2.6
)Total

$
89.0

$
92.0




Year Ended
December 31,
2009

Year Ended
January 1,
2009

Period
February 13,
2007 through
December 27,
2007

Period
December 29,
2006 through
February 12,
2007ALLOWANCE FOR DOUBTFUL ACCOUNTS:Balance at beginning of period

$
2.6

$
1.5

$
1.1

$
1.1Provision for bad debt


2.4


2.3


1.0


0.1Write-offs, net


(1.4
)

(1.2
)

(0.6
)

(0.1
)Balance at end of period

$
3.6

$
2.6

$
1.5

$
1.1


Long-lived AssetsProperty and equipment is stated at cost, net of accumulated depreciation or amortization. Refer to Note 2. Major
renewals and improvements are capitalized, while replacements, maintenance, and repairs that do not improve or extend the lives of the respective assets are expensed currently. In general, the
equipment associated with the digital network that is located within the theatre is owned by the founding members, while equipment outside the theatre is owned by the Company. The Company records
depreciation and amortization using the straight-line method over the following estimated useful lives:

Equipment

4 - 10 yearsComputer hardware and software

3 - 5 yearsLeasehold improvements

Lesser of lease term or asset life


We
account for the costs of software and web site development costs developed or obtained for internal use in accordance with ASC Subtopic 350-40 Internal Use Software(formerly American Institute of
Certified Public Accountants Statement of Position ("SOP") 98-1, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use) and ASC Subtopic 350-50 Website Development Costs(formerly EITF 00-2,Accounting for Web Site Development
Costs). The subtopics require the capitalization of certain costs incurred in developing or obtaining software for internal use. The majority of our software costs and web site
development costs, which are included in equipment, are depreciated over three to five years. As of December 31, 2009 and January 1, 2009, we had a net book value of $11.0 million
and $11.8 million, respectively, of capitalized software and web site development costs. We recorded approximately $6.7 million, $4.9 million, $2.8 million and
$0.3 million for the years ended December 31, 2009, January 1, 2009, the 2007 post-IPO period and the 2007 pre-IPO period, respectively, in depreciation
expense. As of December 31, 2009, January 1, 2009 and the 2007 post-IPO period we recorded $1.6 million, $1.2 million and $1.3 million in research and
development expense, respectively.

Construction
in progress includes costs relating to installations of our equipment into affiliate theatres. Assets under construction are not depreciated until placed into service.

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1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Intangible
assets consist of contractual rights and are stated at cost, net of accumulated amortization. Refer to Note 3. The Company records amortization using the
straight-line method over the estimated useful life of the intangibles.

We
assess impairment of long-lived assets pursuant with ASC Topic 360Property, Plant and Equipment(formerly SFAS
No. 144,Accounting for the Impairment or Disposal of Long-Lived Assets) annually. This includes determining if certain triggering
events have occurred that could affect the value of an asset. Thus far, we have recorded no impairment charges related to long-lived assets.

Amounts Due to/from Founding MembersAmounts due to/from founding members in the 2009 and 2008 periods include amounts due for the theatre access
fee,
offset by a receivable for advertising time purchased by the founding members, as well as revenue share earned for Fathom Events plus any amounts outstanding under other contractually obligated
payments. Payments to or received from the founding members against outstanding balances are made monthly.

Amounts Due to/from Managing MemberIn the 2009 and 2008 periods, amounts due to/from the managing member include amounts due under the
NCM LLC
Operating Agreement and other contractually obligated payments. Payments to or received from the managing member against outstanding balances are made periodically.

Income TaxesAs a limited liability company, NCM LLC's taxable income or loss is allocated to the founding members and managing member and,
therefore, the only provision for income taxes included in the financial statements is for income-based state and local taxes.

Accumulated Other Comprehensive Income/LossAccumulated other comprehensive income/loss is composed of the following (in millions):

Year Ended
Dec. 31,
2009

Year Ended
Jan. 1, 2009

Period
February 13, 2007
through
December 27,
2007Beginning Balance

$
(73.5
)
$
(14.4
)
$
Change in fair value on cash flow hedge


24.8


(59.5
)

(14.4
)Reclassifications into earnings


1.3


0.4


Ending Balance

$
(47.4
)
$
(73.5
)
$
(14.4
)


Debt Issuance CostsIn relation to the issuance of long-term debt discussed in Note 6, we have a balance of $9.2 million and
$11.1 million in deferred financing costs as of
December 31, 2009 and January 1, 2009, respectively. These debt issuance costs are being amortized over the terms of the underlying obligation and are included in interest expense. For
the years ended December 31, 2009, January 1, 2009, 2007 post-IPO period, and the 2007 pre-IPO period we amortized $1.9 million, $1.9 million,
$1.7 million and $0.0, respectively.

Fair Value of Financial InstrumentsThe carrying amounts of cash and cash equivalents, the revolving credit facility and other notes payable as
reported in the Company's balance sheets approximate their fair values due to their short maturity or floating rate terms, as applicable. The carrying amounts and fair values of interest rate swap
agreements are the same since the Company accounts for these instruments at fair value. The Company has estimated the fair value of its term loan based on an average of three non-binding
broker quotes and our reasonability analysis to be

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1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

$688.8 million
and $514.8 million at December 31, 2009 and January 1, 2009, respectively. The carrying value of the term loan was $725.0 million as of
December 31, 2009 and January 1, 2009.

Equity Method InvestmentsThe Company accounts for its investment in RMG Networks, Inc., ("RMG") (formerly Danoo, Inc.) under the equity
method of accounting as required by ASC Topic 323-10InvestmentsEquity Method and Joint Ventures(formerly APB
No. 18,The Equity Method of Accounting for Investments in Common Stock) because we exert "significant influence" over, but do not control, the
policy and decisions of RMG (see Note 9). As of December 31, 2009, the Company owns approximately 24% of the issued and outstanding preferred and common stock of RMG (before considering
out-of-the-money warrants). The Company's investment is $7.4 million. The investment in RMG and the Company's share of its operating results are not material
to the Company's financial position or results of operations and as a result summarized financial information is not presented.

Share-Based CompensationStock-based employee compensation is accounted for at fair value under ASC Topic 718 CompensationStock Compensation(formerly SFAS No. 123(R),Share-Based Payment). The
Company adopted Topic 718 on December 30, 2005 prospectively for new equity based grants, as there were no equity based grants prior to the date of adoption. Refer to Note 7.



ASC Topic 815-10Derivatives and Hedging(formerly SFAS No. 161, Disclosures about Derivative Instruments and
Hedging Activities) was adopted by the Company effective January 2, 2009. The guidance under Topic
815-10 changes the manner of presentation and related disclosures of the fair values of derivative instruments and their gains and losses (see Note 10).

In
April 2009, the Company adopted ASC Topic 820-10-65Fair Value Measurements and Disclosures(formerly FASB
Staff Position No. SFAS 157-4,Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and
Identifying Transactions That Are Not Orderly). The standard provides additional guidance for estimating fair value in accordance with
Topic 820-10-65 when the volume and level of activity for the asset or liability have significantly decreased and includes guidance on identifying circumstances that
indicate if a transaction is not orderly. The Company adopted this pronouncement effective April 3, 2009 with no impact on its financial statements.

In
July 2009, the FASB issued SFAS No. 168,The Hierarchy of Generally Accepted Accounting Principles. SFAS 168 codified all
previously issued accounting pronouncements, eliminating the prior hierarchy of accounting literature, in a single source for authoritative U.S. GAAP recognized by the FASB to be applied by
nongovernmental entities. SFAS 168, now ASC Topic 105-10Generally Accepted Accounting Principles, is effective for financial
statements issued for interim and annual periods ending after September 15, 2009. The adoption of this pronouncement did not have an effect on the financial statements.

The
Company adopted, ASC Topic 855-10Subsequent Events(formerly SFAS 165,Subsequent
Events) effective April 3, 2009, which was modified in February 2010. This pronouncement changes the general standards of accounting for and disclosure of events that
occur after the balance sheet date but before financial statements are issued or are available to be issued (see Note 12).

In
August 2009, the FASB issued Accounting Standards Update ("ASU") No. 2009-05,Measuring Liabilities at Fair Value,
which clarifies, among other things, that when a quoted price in an active market for the identical liability is not available, an entity must measure fair value using one or more specified
techniques. The Company adopted the pronouncement effective July 2, 2009 with no impact on its financial statements.

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Table of Contents

1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

In
October 2009, the FASB issued ASU No. 2009-13,Multiple-Deliverable Revenue Arrangements,which revises the existing
multiple-element revenue arrangements guidance and changes the determination of when the individual deliverables included in a multiple-element revenue arrangement may be treated as separate units of
accounting, modifies the manner in which the transaction consideration is allocated across the separately identified deliverables and expands the disclosures required for multiple-element revenue
arrangements. The pronouncement is effective for financial statements issued after December 31, 2010. The Company does not expect the pronouncement to have a material effect on its financial
statements.

In
January 2010, the FASB issued ASU No. 2010-06,Improving Disclosures about Fair Value Measurements, which requires
additional disclosures about (1) the different classes of assets and liabilities measured at fair value, (2) the valuation techniques and inputs used, (3) the activity in
Level 3 fair value measurements, and (4) the transfers between Levels 1, 2 and 3. The new disclosures are effective for financial statements issued for interim and annual periods
beginning after December 15, 2009. The Company does not expect the pronouncement to have a material effect on its financial statements.

The
Company has considered all other recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial
statements.

2. PROPERTY AND EQUIPMENT(in millions)

As of
December 31,
2009

As of
January 1,
2009Equipment

$
60.6

$
53.3Leasehold Improvements


1.6


1.4Less accumulated depreciation


(39.3
)

(27.0
)Subtotal


22.9


27.7Construction in Progress


0.8


0.3Total property and equipment

$
23.7

$
28.0


For
the years ended December 31, 2009, January 1, 2009, 2007 post-IPO period and 2007 pre-IPO period we recorded depreciation of
$12.5 million, $10.2 million, $4.8 million and $0.6 million respectively.

3. INTANGIBLE ASSETS

During 2008, NCM LLC issued 2,544,949 common membership units to its founding members in connection with its rights of exclusive access to net new theatres and projected attendees
added by the founding members to NCM LLC's network and 2,913,754 common membership units to Regal in connection with the closing of its acquisition of Consolidated Theatres (see Note 5).
The Company recorded an intangible asset of $116.1 million representing the contractual rights. During the first quarter of 2009, NCM LLC issued 2,126,104 common membership units to its
founding members in exchange for the rights to exclusive access to net new theatre screens and projected attendees added by the founding members to NCM LLC's network. As a result,
NCM LLC recorded an intangible asset at fair value of $28.5 million. The Company based the fair value of the intangible assets on the fair value of the common membership units issued on
the date of grants, which are freely convertible into NCM Inc.'s common stock.

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3. INTANGIBLE ASSETS (Continued)

Pursuant to ASC Topic 350-10IntangiblesGoodwill and Other(formerly SFAS No. 142, Goodwill and Other Intangible
Assets), the intangible assets have a finite useful life and the Company amortizes the assets over the remaining useful
life corresponding with the ESAs. Amortization of the asset related to Regal Consolidated Theatres will not begin until after 2011 since the Company will not have access to on-screen
advertising in the Regal Consolidated Theatres until the run-out of their existing on-screen advertising agreement.

As of December 31,
2009

As of January 1,
2009(in millions)Beginning balance

$
111.8

$
Purchase of intangible asset subject to amortization


28.5


116.1Less integration payments


(3.2
)

(2.8
)Less amortization expense


(2.9
)

(1.5
)Total intangible assets

$
134.2

$
111.8


For
the years ended December 31, 2009 and January 1, 2009 we recorded amortization of $2.9 million and $1.5 million, respectively.

The
estimated aggregate amortization expense for each of the five succeeding years are as follows (in millions):

2010

$
3.02011


4.92012


4.92013


4.92014


4.9


4. ACCRUED EXPENSES(in millions)

As of December 31,
2009

As of January 1,
2009Make-good Reserve

$
0.3

$
1.3Accrued Interest


9.8


4.0Other accrued expenses


2.3


1.0Total accrued expenses

$
12.4

$
6.3


5. RELATED-PARTY TRANSACTIONS



Pursuant to the ESAs, the Company makes monthly theatre access fee payments to the founding members, comprised of a payment per theatre
attendee and a payment per digital screen with respect to the founding member theatres included in our network. Also, the founding members are purchasing 60 seconds of on-screen
advertising time (with a right to purchase up to 90 seconds) for the year ended December 31, 2009 to satisfy their obligations under their beverage concessionaire agreements at a specified 30
second equivalent cost per thousand ("CPM") impressions. For the year ended January 1, 2009 two of the founding members purchased 90 seconds and one purchased 60 seconds of
on-screen advertising time under their beverage concessionaire agreement. For the 2007 post-IPO period, all three founding members purchased 90 seconds of on-screen
time. The total theatre access fee to the

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5. RELATED-PARTY TRANSACTIONS (Continued)

founding
members for the years ended December 31, 2009, January 1, 2009 and the 2007 post-IPO period is $52.7 million, $49.8 million and $41.5 million,
respectively. The total revenue related to the beverage concessionaire agreements for the years ended December 31, 2009, January 1, 2009 and the 2007 post-IPO period is
$36.3 million, $43.3 million and $40.9 million, respectively. In addition, the Company makes payments to the founding members for use of their screens and theatres for its Fathom
Events businesses. These payments are at rates (percentage of event revenue) included in the ESAs based on the nature of the event. Payments to the founding members for these events totaled
$6.7 million, $6.0 million and $3.8 million for the years ended December 31, 2009, January 1, 2009 and the 2007 post-IPO period, respectively.

Also,
pursuant to the terms of the LLC Operating Agreement in place since the close of NCM, Inc.'s IPO, NCM LLC is required to make mandatory distributions on a
proportionate basis to its members of available cash, as defined in the LLC Operating Agreement, on a quarterly basis in arrears. Balances for the years ended December 31, 2009,
January 1, 2009 and the 2007 post-IPO period are as follows (in millions):

2009

2008

Post-IPOAMC

$
25.8

$
24.3

$
22.2Cinemark


20.8


18.5


16.7Regal


34.9


32.7


26.9NCM, Inc.


57.8


55.6


53.3Total

$
139.3

$
131.1

$
119.1


On
January 26, 2006, AMC acquired the Loews Cineplex Entertainment Inc. ("AMC Loews") theatre circuit. The Loews screen integration agreement, effective as of
January 5, 2007 and amended and restated as of February 13, 2007, between NCM LLC and AMC, committed AMC to cause substantially all of the theatres it acquired as part of the
Loews theatre circuit to be included in the NCM digital network in accordance with the ESAs on June 1, 2008. In accordance with the Loews screen integration agreement, prior to June 1,
2008 AMC paid the Company amounts based on an agreed-upon calculation to reflect cash amounts that approximated what NCM LLC would have generated if the Company sold
on-screen advertising in the Loews theatre chain on an exclusive basis. These AMC Loews payments were made on a quarterly basis in arrears through May 31, 2008, with the exception
of Star Theatres, which were paid through February 2009 in accordance with certain run-out provisions. For the years ended December 31, 2009, January 1, 2009 and the 2007
post-IPO period, the AMC Loews payment was $0.1 million,
$4.7 million and $11.2 million respectively. The AMC Loews payment was recorded directly to NCM LLC's members' equity account.

On
April 30, 2008, Regal acquired Consolidated Theatres and NCM issued common membership units to Regal upon the closing of its acquisition in exchange for the right to exclusive
access to the theatres (see Note 3). The Consolidated Theatres had a pre-existing advertising agreement and, as a result, Regal must make "integration" payments pursuant to the ESAs
on a quarterly basis in arrears through 2011 in accordance with certain run-out provisions. For the years ended December 31, 2009 and January 1, 2009, the Consolidated
Theatres payment was $3.2 million and $2.8 million, respectively and represents a cash element of the consideration received for the common membership units issued.

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5. RELATED-PARTY TRANSACTIONS (Continued)

Amounts
due to/from founding members at December 31, 2009 were comprised of the following (in millions):

AMC

Cinemark

Regal

TotalTheatre access fees, net of beverage revenues

$
0.5

$
0.4

$
0.5

$
1.4Cost and other reimbursement


(0.5
)

(0.5
)

(0.5
)

(1.5
)Distributions payable, net


9.9


7.9


12.1


29.9Total

$
9.9

$
7.8

$
12.1

$
29.8


Amounts
due to/from founding members at January 1, 2009 were comprised of the following (in millions):

AMC

Cinemark

Regal

TotalTheatre access fees, net of beverage revenues

$
(0.1
)
$


$
0.7

$
0.6Cost and other reimbursement


(1.1
)

(0.5
)

(0.6
)

(2.2
)Distributions payable, net


8.9


7.0


11.3


27.2Total

$
7.7

$
6.5

$
11.4

$
25.6




At the formation of NCM LLC and upon the admission of Cinemark as a founding member, circuit share arrangements and
administrative services fee arrangements were in place with each founding member. Circuit share cost and administrative fee revenue by founding member were as follows (in millions):

Pre-IPO Period
December 29, 2006
through February 12, 2007Circuit Share
Cost

Administrative
Fee RevenueAMC

$
4.1

$
Cinemark


3.7


0.1Regal


6.6


Total

$
14.4

$
0.1


At
the closing of NCM, Inc.'s IPO, the founding members entered into amended and restated ESAs, which, among other things, amended the circuit share structure in favor of the
theatre access fee structure.

Pursuant
to the agreements entered into at the completion of NCM, Inc.'s IPO, amounts owed to the founding members through the date of NCM, Inc.'s IPO of
$50.8 million were paid by NCM LLC on March 15, 2007.



During the years ended December 31, 2009, January 1, 2009, the 2007 post-IPO period, and the 2007
pre-IPO period, AMC, Cinemark and Regal purchased $1.9 million, $2.3 million, $1.4 million and $0.1 million respectively, of NCM LLC's advertising
inventory for their own use. The value of such

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5. RELATED-PARTY TRANSACTIONS (Continued)

purchases
are calculated by reference to NCM LLC's advertising rate card and is included in advertising revenue.

Included
in Fathom Events operating costs is $1.0 million, $1.8 million, $3.3 million and $0.2 million for the years ended December 31, 2009,
January 1, 2009, the 2007 post-IPO period and the 2007 pre-IPO period respectively, related to purchases of movie tickets and concession products from the founding
members primarily for marketing resale to NCM LLC's customers.



Pursuant to the LLC Operating Agreement, as the sole manager of NCM LLC, NCM, Inc. provides certain specific
management services to NCM LLC, including those services of the positions of president and chief executive officer, president of sales and chief marketing officer, executive vice president and
chief financial officer, executive vice president and chief operations officer and executive vice president and general counsel. In exchange for the services, NCM LLC reimburses
NCM, Inc. for compensation and other expenses of the officers and for certain out-of-pocket costs. During the years ended December 31, 2009 and January 1,
2009 and the 2007 post-IPO period, NCM LLC paid NCM, Inc. $10.8 million, $9.7 million and $9.2 million, respectively, for these services and expenses.
The payments for estimated management services related to employment are made one month in advance. At December 31, 2009 and January 1, 2009, $0.6 million and $0.5 million,
respectively, has been paid in advance and is reflected as prepaid management fees to managing member in the accompanying financial statements. NCM LLC also provides administrative and support
services to NCM, Inc. such as office facilities, equipment, supplies, payroll and accounting and financial reporting at no charge. Based on the limited activities of NCM, Inc. as a
standalone entity, the Company does not believe such unreimbursed costs are significant. The management services agreement also provides that NCM LLC employees may participate in the
NCM, Inc. equity incentive plan (see Note 7).

Amounts
due to/from managing member were comprised of the following (in millions):

At December 31, 2009

At January 1, 2009Distributions payable

$
22.0

$
21.0Cost and other reimbursement


0.9


1.1Total

$
22.9

$
22.1


6. BORROWINGS

On February 13, 2007, concurrently with the closing of the IPO of NCM, Inc., NCM LLC entered into a senior secured credit facility with a group of lenders. The
facility consists of a six-year $80.0 million revolving credit facility and an eight-year, $725.0 million term loan facility. The revolving credit facility portion is
available, subject to certain conditions, for general corporate
purposes of the Company in the ordinary course of business and for other transactions permitted under the credit agreement, and a portion is available for letters of credit.

The
outstanding balance of the term loan facility at December 31, 2009 and January 1, 2009 was $725.0 million. The outstanding balance under the revolving credit
facility at December 31, 2009 and January 1, 2009 was $74.0 million. As of December 31, 2009, the effective rate on the term loan was 5.59% including the effect of the
interest rate swaps (both those accounted for as hedges and those not). The interest rate swaps hedged $550.0 million of the $725.0 million term loan at a fixed interest rate of 6.734%
while the unhedged portion was at an interest rate of 2.01%. The weighted-average interest rate on the unhedged revolver was 1.99%. Commencing with the fourth fiscal quarter in fiscal

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6. BORROWINGS (Continued)

year
2008, the applicable margin for the revolving credit facility is determined quarterly and is subject to adjustment based upon a consolidated net senior secured leverage ratio for NCM LLC
and its subsidiaries (the ratio of secured funded debt less unrestricted cash and cash equivalents, over a non-GAAP measure defined in the credit agreement which is equivalent to Adjusted
OIBDA). The senior secured credit facility also contains a number of covenants and financial ratio requirements, with which the Company was in compliance at December 31, 2009, including the
consolidated net senior secured leverage ratio. There are no distribution restrictions as long as the Company is in compliance with its debt covenants. As of December 31, 2009, our consolidated
net senior secured leverage ratio was 4.0 times the covenant. The debt covenants also require 50% of the term loan, or $362.5 million to be hedged at a fixed rate. As of December 31,
2009, the Company had approximately $550 million or 76% hedged. Of the $550.0 million that is hedged, $137.5 million is with Lehman Brothers Special Financing ("LBSF"). As
described further in Note 12, in February 2010 LBSF transferred its interest rate swap agreement to Barclays Bank PLC ("Barclays"). See Note 10 for an additional discussion of the
interest rate swaps.

On
September 15, 2008, Lehman Brothers Holdings Inc. ("Lehman") filed for protection under Chapter 11 of the federal Bankruptcy Code in the United States Bankruptcy
Court for the Southern District of New York. NCM LLC has an aggregate revolving credit facility commitment of $80.0 million with a consortium of banks, including $20.0 million
with Lehman Commercial Paper Inc. ("LCPI"), a subsidiary of Lehman. As of December 31, 2009, NCM LLC borrowed $14.0 million from LCPI under the revolving credit facility.
Following the bankruptcy filing, LCPI failed to fund a borrowing request related to its undrawn commitment of $6.0 million. On February 3, 2010, LCPI assigned the $6.0 million commitment
to Barclays. Until the LCPI issues are resolved, NCM LLC is not anticipating repaying any of its revolver borrowings as it would effectively result in a permanent reduction of its revolving
credit facility, to the extent of any payments of LCPI commitments. In addition, NCM LLC has been working with LCPI and its other lenders with the goal of having LCPI's agency function
transferred to another bank within NCM LLC's lender group and restructuring LCPI's outstanding $14.0 million revolving loan such that (i) it would not be required to be repaid,
nor would it share in any pro rata prepayments of the revolving loans, until the final maturity date of the revolving credit facility, and (ii) it would not be available for reborrowing in the
event that it was prepaid. Until these LCPI issues are resolved, however, NCM LLC is not anticipating repaying any of its revolver borrowings as it would effectively result in a permanent
reduction of its revolving credit facility, to the extent of the payments against LCPI borrowings.

On
March 19, 2009, the Company gave an $8.5 million note payable to Credit Suisse, Cayman Islands Branch ("Credit Suisse") with no stated interest to settle the
$10.0 million contingent put obligation and to acquire the $20.7 million outstanding principal balance of debt of IdeaCast, Inc. ("IdeaCast") (together with all accrued interest
and other lender costs required to be reimbursed by IdeaCast). Quarterly payments to Credit Suisse began on April 15, 2009 and will continue through January 15, 2011. At issuance the
Company recorded the note at a present value of $7.0 million. At December 31, 2009, $4.3 million of the balance is recorded in current liabilities and $0.3 million is
included in non-current liabilities. Interest on the note is accreted at the Company's estimated incremental cost of debt based on then current market indicators over the term of the loan
to interest expense. The amount of interest expense recognized on the note for the year ended December 31, 2009 was $0.7 million. See Note 9 "Contingent Put
Obligation" for additional discussion of the IdeaCast restructuring.

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6. BORROWINGS (Continued)



The scheduled annual maturities on the senior secured credit facility for the next five years as of December 31, 2009 are as
follows (in millions):

2010

$
4.32011


2012


2013


74.02014


Thereafter


725.0Total

$
803.3


7. SHARE-BASED COMPENSATION

On April 4, 2006, NCM LLC's board of directors approved the NCM LLC 2006 Unit Option Plan, under which 1,131,728 units were outstanding as of December 28,
2006. Under certain circumstances, holders of unit options could put the options to NCM LLC for cash. As such, the Unit Option Plan was accounted for as a liability plan and the liability was
measured at its fair value at each reporting date. The valuation of the liability was determined based on provisions of ASC Topic 718CompensationStock
Compensation(formerly SFAS No. 123(R)), and factored into the valuation that the options were granted in contemplation of NCM, Inc.'s IPO. The Company used the
estimated pricing of NCM, Inc.'s IPO at the time of the grant to determine the equity value for each unit underlying the options. The Unit Option Plan allowed for additional equity awards to be
issued to outstanding option holders in the event of the occurrence of NCM, Inc.'s IPO, with the purpose of the additional option awards or restricted units being to ensure that the economic
value of outstanding unit options, as defined in the agreement, held just prior to NCM, Inc.'s IPO was maintained by the option holder immediately after the offering.

At
the date of the NCM, Inc. IPO, the Company adopted the NCM, Inc. 2007 Equity Incentive Plan. The employees of NCM, Inc. and NCM LLC are eligible to
participate in the Equity Incentive Plan. Under the Equity Incentive Plan, eligible employees were issued stock options on 1,589,625 shares of common stock to holders of outstanding unit options in
substitution of the unit options and also issued 262,466 shares of restricted stock. In connection with the conversion at the date of NCM, Inc.'s IPO, and pursuant to the antidilution
adjustment terms of the Unit Option Plan, the exercise price and the number of shares of common stock subject to options held by the Company's option holders were adjusted to prevent dilution and
restore their economic position to that existing immediately before the NCM, Inc. IPO. The Equity Incentive Plan is treated as an equity plan under the provisions of Topic 718, and the existing
liability under the Unit Option Plan at the end of the 2007 pre-IPO period of $2.3 million was reclassified to equity at that date.

As
of December 31, 2009, there were 7,076,000 shares of common stock available for issuance or delivery under the Equity Incentive Plan. Options awarded under the Equity Incentive
Plan are generally granted with an exercise price equal to the market price of NCM, Inc. common stock on the date of the grant. Upon vesting of the awards, NCM LLC will issue common
membership units to NCM, Inc. equal to the number of shares of NCM, Inc.'s common stock represented by such awards. Under the fair value recognition provisions of Topic 718, the Company
recognizes stock-based compensation net of an estimated forfeiture rate, and therefore only recognizes stock-based compensation cost for those shares expected to vest over the requisite service period
of the award. Options generally vest annually over a three or five-year period and have either 10-year or 15-year

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7. SHARE-BASED COMPENSATION (Continued)

contractual
terms. A forfeiture rate of 5% was estimated for all employees to reflect the potential separation of employees.

The
recognized expense, including equity based compensation costs of NCM, Inc. employees, is included in the operating results of NCM LLC. The Company recognized
$3.1 million, $2.1 million, $1.9 million, and $0.3 million for the year ended December 31, 2009, January 1, 2009, the 2007 post-IPO period, and
the 2007 pre-IPO period, respectively, of share-based compensation expense for these options and $0.1 million and $0.1 million were capitalized during the year ended
December 31, 2009 and January 1, 2009, respectively. As of December 31, 2009, unrecognized compensation cost related to nonvested options was approximately $7.1 million,
which will be recognized over a weighted average remaining period of 2.33 years.

The
weighted average grant date fair value of granted options was $2.17, $3.77 and $6.23 for the years ended December 31, 2009 and January 1, 2009 and the 2007
post-IPO period, respectively. The intrinsic value of options exercised during the year was $0.2 million for both years ended December 31, 2009 and January 1, 2009.
During the year ended December 31, 2009 there was an immaterial amount of cash received on options exercised and $0.6 million received for the 2008 period. The total fair value of awards
vested during the years ended December 31, 2009 and January 1, 2009 was $0.3 million and $3.9 million, respectively. There were no options vested or exercised prior to the
2008 fiscal year.

The
fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model, which requires that the Company make estimates of various factors. The
following assumptions were used in the valuation of the options:

Fiscal 2009

Fiscal 2008

Fiscal 2007Expected life of options

6.5 years

6.5 years

6.5 to 9 yearsRisk free interest rate

2.23% to 3.70%

3.74% to 4.09%

4.1% to 4.9%Expected volatility

30%

30%

30%Dividend yield

3%

3%

3%


Activity
in the Equity Incentive Plan, as converted, is as follows:

Shares

Weighted
Average
Exercise
Price

Weighted
Average
Remaining
Contractual Life
(in years)

Aggregate
Intrinsic
Value (in
millions)Outstanding at January 1, 2009


2,025,099

$
17.33Granted


1,156,515


9.53Exercised


(1,800
)

5.35Forfeited


(53,254
)

14.35Outstanding at December 31, 2009


3,126,560

$
14.51


9.9

$
9.2Exercisable at December 31, 2009


648,359

$
17.67


10.5

$
0.2Vested and Expected to Vest at December 31, 2009


3,090,782

$
14.52


9.9

$
9.0


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Table of Contents

7. SHARE-BASED COMPENSATION (Continued)

The following table summarizes information about the stock options at December 31, 2009, including the weighted average remaining contractual life and weighted average exercise
price:

Options Outstanding

Options ExercisableRange of Exercise Price

Number
Outstanding at
Dec. 31, 2009

Weighted
Average
Remaining Life
(in years)

Weighted
Average
Exercise
Price

Number
Exercisable at
Dec. 31, 2009

Weighted
Average
Exercise
Price$5.35  - $9.22


1,126,350


9.0

$
9.06


7,800

$
5.35$11.59 - $15.04


136,408


8.9


13.47


14,600


12.33$16.35 - $18.01


1,409,436


11.3


16.52


476,280


16.56$19.37 - $21.00


301,500


7.5


20.35


96,000


20.59$24.04 - $29.05


152,866


10.1


25.40


53,679


25.593,126,560


9.9

$
14.51


648,359

$
17.67


Non-vested (Restricted) StockNCM, Inc. has a non-vested stock program as part of the Equity Incentive Plan. The plan
provides for non-vested stock awards to officers, board members and other key employees, including employees of NCM LLC. Under the non-vested stock program, common stock
of NCM, Inc. may be granted at no cost to officers, board members and key employees, subject to a continued employment restriction and as such restrictions lapse, the award vests in that
proportion. The participants are entitled to cash dividends from NCM, Inc. and to vote their respective shares, although the sale and transfer of such shares is prohibited and the shares are
subject to forfeiture during the restricted period. The shares are also subject to the terms and provisions of the Equity Incentive Plan. Non-vested stock awards granted in 2009 include
performance vesting conditions, which permit vesting to the extent that NCM, Inc. achieves specified non-GAAP targets at the end of the three-year period.
Non-vested stock granted to non-employee directors vest after one year. Compensation cost is valued based on the market price on the grant date and is expensed over the vesting
period.

The
following table represents the shares of non-vested stock:

Shares

Weighted
Average Grant-
Date Fair ValueNon-vested as of January 1, 2009


203,618

$
20.91Granted


424,555


9.50Forfeited


(12,500
)

10.10Vested


(25,299
)

21.93Non-vested as of December 31, 2009


590,374

$
13.15


The
recognized expense, including the equity based compensation costs of NCM, Inc. employees, is included in the operating results of NCM LLC. The Company recorded
$2.4 million, $1.3 million and $1.2 million in compensation expense related to such outstanding non-vested shares during the years ended December 31, 2009,
January 1, 2009 and the 2007 post-IPO period. Minimal amounts were capitalized during the 2009 fiscal year. As of December 31, 2009, unrecognized compensation cost related to
non-vested stock was approximately $5.1 million, which will be recognized over a weighted average remaining period of 2.27 years. The total fair value of awards vested during
the year ended December 31, 2009 was $0.3 million.

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8. EMPLOYEE BENEFIT PLANS

NCM LLC sponsors the NCM 401(k) Profit Sharing Plan (the "Plan") under Section 401(k) of the Internal Revenue Code of 1986, as amended, for the benefit of substantially all
full-time employees. The Plan provides that participants may contribute up to 20% of their compensation, subject to Internal Revenue Service limitations. Employee contributions are
invested in various investment funds based upon election made by the employee. The recognized expense, including the discretionary contributions of NCM, Inc. employees, is included in the
operating results of NCM LLC. The Company made discretionary contributions of $0.8 million, $0.8 million, and $0.6 million during the years ended December 31, 2009,
January 1, 2009 and December 27, 2007, respectively.

9. COMMITMENTS AND CONTINGENCIES

The Company is subject to claims and legal actions in the ordinary course of business. The Company believes such claims will not have a material adverse effect on its financial position
or results of operations.



The Company leases office facilities for its headquarters in Centennial, Colorado and also in various cities for its sales and
marketing personnel as sales offices. The Company has no capital lease obligations. Total lease expense for the years ended December 31, 2009, January 1, 2009, 2007 post-IPO
period and the 2007 pre-IPO period, was $2.3 million, $2.0 million, $1.3 million, and $0.3 million, respectively.

Future
minimum lease payments under noncancelable operating leases as of December 31, 2009 are as follows (in millions):

2010

$
2.22011


2.12012


2.02013


1.92014


0.8Thereafter


0.2Total

$
9.2




On April 29, 2008, NCM LLC, IdeaCast, the IdeaCast lender and certain of its stockholders agreed to a financial
restructuring of IdeaCast. Among other things, the restructuring resulted in the lender being granted an option to "put," or require NCM LLC to purchase, up to $10 million of the funded
convertible debt at par, on or after December 31, 2010 through March 31, 2011. The put was accounted for under ASC Topic 460-10 Guarantees(formerly FIN No. 45 (as amended),Guarantor's Accounting and Disclosure Requirements for Guarantees,
Including Indirect Guarantees of Indebtedness of Others). During the fourth quarter of 2008, the Company determined that the initial investment and call right in IdeaCast were
other-than-temporarily impaired due to IdeaCast's defaults on its senior debt and liquidity issues and that the put obligation was probable. The Company estimated a liability
at January 1, 2009 of $4.5 million, which represented the excess of the estimated probable loss on the put (net of estimated recoveries from the net assets of IdeaCast that serve as
collateral for the convertible debt) obligation over the unamortized ASC Topic 460-10 liability. The total amount of the impairment and related loss recorded in the fourth quarter of 2008
was $11.5 million.

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Table of Contents

9. COMMITMENTS AND CONTINGENCIES (Continued)

On
March 19, 2009, NCM LLC, IdeaCast and IdeaCast's lender agreed to certain transactions with respect to the IdeaCast Credit Agreement. Among other things, these
agreements resulted in (i) the termination of the Put and the Call; (ii) the transfer, sale and assignment by IdeaCast's lender to NCM LLC of all of its right, title and interest
under the Credit Agreement, including without limitation the loans outstanding under the Credit Agreement; (iii) the resignation of IdeaCast's lender, and the appointment of NCM LLC, as
administrative agent and collateral agent under the Credit Agreement; and (iv) the delivery by NCM LLC to IdeaCast's lender of a non-interest bearing promissory note in the
amount of $8.5 million payable through January 2011. On June 16, 2009, NCM LLC's interest in the Credit Agreement was assigned to NCM
Out-Of-Home, LLC ("OOH"), which was a wholly-owned subsidiary of NCM LLC. OOH was also appointed as administrative agent and collateral agent under the Credit
Agreement. On June 16, 2009, OOH, as IdeaCast's senior secured lender, foreclosed on substantially all of the assets of IdeaCast, consisting of certain tangible and intangible assets (primarily
equipment, business processes and contracts with health clubs and programming partners). The assets were valued at approximately $8.2 million. On June 29, 2009, NCM LLC
transferred its ownership interest in OOH to RMG, a digital advertising company, in exchange for approximately 24% of the equity (excluding out-of-the-money
warrants) of RMG on a fully diluted basis through a combination of convertible preferred stock, common stock and common stock warrants (refer to Note 1Equity Method Investments).
The Company's investment in RMG was valued at the fair value of the assets contributed.



As part of the network affiliate agreements entered in the ordinary course of business under which the Company sells advertising for
display in various theatre chains other than those of the founding members of NCM LLC, the Company has agreed to certain minimum revenue guarantees. If an affiliate achieves the attendance set
forth in their respective agreement, the Company has guaranteed minimum revenue for the network affiliate per attendee if such amount paid under the revenue share arrangement is less than its
guaranteed amount. The amount and term varies for each network affiliate, but ranges from two to five years. The maximum potential amount of future payments the Company could be required to
make pursuant to the minimum revenue guarantees is $21.2 million over the remaining terms of the network affiliate agreements. For the years ended December 31, 2009 and January 1,
2009 the Company had no liabilities recorded for these obligations as such guarantees are less than the expected share of revenue paid to the affiliate.

10. FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS

Fair Value MeasurementsThe fair values of the Company's assets and liabilities measured on a recurring basis pursuant to ASC Topic 820-10
Fair Value Measurements and Disclosures(formerly FAS No. 157,Fair Value Measurements and
Disclosures) are as follows (in millions):

Fair Value Measurements at Reporting Date UsingAt
December 31,
2009

Quoted Prices in
Active Markets
for Identical
Assets (Level 1)

Significant
Other
Observable
Inputs (Level 2)

Significant
Unobservable
Inputs (Level 3)LIABILITIES:Interest Rate Swap Agreements

$
54.6




$
54.6





Derivative InstrumentsNCM LLC has interest rate swap agreements with four counterparties that, at their inception, qualified for and were
designated as cash flow hedges against interest rate exposure

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Table of Contents

10. FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS (Continued)

on
$550.0 million of the variable rate debt obligations under the senior secured credit facility. The interest rate swap agreements have the effect of converting a portion of the Company's
variable rate debt to a fixed rate of 6.734%. All interest rate swaps were entered into for risk management purposes. The Company has no derivatives for other purposes.

On
September 15, 2008, Lehman filed for protection under Chapter 11 of the Federal Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New
York. LBSF is the counterparty to a notional amount of $137.5 million of NCM LLC's interest rate swaps, and Lehman is a
guarantor of LBSF's obligations under such swap. NCM LLC notified LBSF on September 18, 2008 that, as a result of the bankruptcy of Lehman, an event of default had occurred under the
swap with respect to which LBSF was the defaulting party. On October 3, 2008, LBSF also filed for Chapter 11 protection, which constituted another default by LBSF under the swap. As a
result, as permitted under the terms of NCM LLC's swap agreement with LBSF, the Company has withheld interest rate swap payments aggregating $5.5 million in the year ended
December 31, 2009 and $1.5 million in the year ended January 1, 2009 that were due to LBSF, and has further notified LBSF that the bankruptcy and insolvency of both Lehman and
LBSF constitute default events under the swap. As of December 31, 2009 the interest rate swap agreement had not been terminated.

The
Company performed an effectiveness test for the swaps with LBSF as of September 14, 2008, the day immediately prior to the default date, and determined they were effective on
that date. As a result, the fair values of the interest rate swap on that date was recorded as a liability with an offsetting amount recorded in other comprehensive income. Cash flow hedge accounting
was discontinued on September 15, 2008 due to the event of default and the inability of the Company to continue to demonstrate the swap would be effective. The Company continues to record the
interest rate swap with LBSF at fair value with any change in the fair value recorded in the statement of operations.

There
was an $8.3 million decrease and a $13.8 million increase in the fair value of the liability for the years ended December 31, 2009 and January 1, 2009,
respectively, which the Company recorded as a component of interest expense. In accordance with Topic 815Derivatives and Hedging, the net derivative
loss as of September 14, 2008 related to the discontinued cash flow hedge with LBSF shall continue to be reported in accumulated other comprehensive income unless it is probable that the
forecasted transaction will not occur by the end of the originally specified time period. Accordingly, the net derivative loss is being amortized to interest expense over the remaining term of the
interest rate swap through February 13, 2015. The amount amortized during the years ended December 31, 2009 and January 1, 2009 were $1.3 million and $0.4 million,
respectively. The Company estimates approximately $1.3 million will be amortized to interest expense in the next 12 months.

Both
at inception and on an on-going basis the Company performs an effectiveness test using the hypothetical derivative method. The fair values of the interest rate swaps
with the counterparties other than LBSF (representing notional amounts of $412.5 million associated with a like amount of the variable rate debt) are recorded on the Company's balance sheet as
a liability with the change in fair value recorded in other comprehensive income since the instruments other than LBSF were determined to be perfectly effective at December 31, 2009 and
January 1, 2009. There were no amounts reclassified into current earnings due to ineffectiveness during the periods presented other than as described below.

The
fair value of the Company's interest rate swap is based on dealer quotes, and represents an estimate of the amount the Company would receive or pay to terminate the agreements taking
into consideration various factors, including current interest rates and the forward yield curve for 3-month LIBOR.

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Table of Contents

10. FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS (Continued)

At December 31, 2009 and January 1, 2009, the estimated fair value and line item caption of derivative instruments recorded were as follows (in millions):

Liability DerivativesAs of December 31, 2009

As of January 1, 2009Balance Sheet
Location

Fair
Value

Balance Sheet
Location

Fair
ValueDerivatives designated as hedging instruments:Interest Rate Swaps

Other Liabilities

$
40.9

Other Liabilities

$
65.8Derivatives not designated as hedging instruments:Interest Rate Swaps

Other Liabilities

$
13.7

Other Liabilities

$
21.9Total derivatives



$
54.6



$
87.7


The
effect of derivative instruments in cash flow hedge relationships on the financial statements for the year ended December 31, 2009, January 1, 2009, the 2007
post-IPO period were as follows (in millions):

Unrealized Gain (Loss)
Recognized in NCM LLC's
OCI (Pre-tax)

Realized Gain (Loss)
Recognized in Interest
Expense (Pre-tax)Year
Ended
Dec. 31,
2009

Year
Ended
Jan. 1,
2009

Period
Feb. 13,
2007
through
Dec. 27,
2007

Year
Ended
Dec. 31,
2009

Year
Ended
Jan. 1,
2009

Period
Feb. 13,
2007
through
Dec. 27,
2007Interest Rate Swaps

$
9.3

$
(67.9
)
$
(12.3
)
$
(16.7
)
$
(8.8
)
$
2.1


There
was $1.3 million and $0.4 million $0.0 million and $0.0 million of ineffectiveness recognized for the years ended December 31, 2009,
January 1, 2009, the 2007 post-IPO period and the 2007 pre-IPO period, respectively.

The
effect of derivative not designated as hedging instruments under Topic 815 on the financial statements for the years ended December 31, 2009, January 1, 2009, the 2007
post-IPO period and the 2007 pre-IPO period were as follows (in millions):

Gain or (Loss) Recognized in
Interest Expense (Pre-tax)Year
Ended
Dec. 31,
2009

Year
Ended
Jan. 1,
2009

Period
Feb. 13,
2007
through
Dec. 27,
2007Borrowings

$
(6.2
)
$
(1.0
)
$
Change in derivative fair value


7.0


(14.2
)

Total

$
0.8

$
(15.2
)
$



11. SEGMENT REPORTING

Advertising is the principal business activity of the Company and is the Company's reportable segment under the requirements of ASC Topic 280,Segment
Reporting. Advertising revenue accounts

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11. SEGMENT REPORTING (Continued)

for
88.0%, 89.4%, 91.7% and 87.7% of revenue for the years ended December 31, 2009, January 1, 2009, the post-IPO period and the pre-IPO period, respectively.
Fathom Consumer Events and Fathom Business Events are operating segments under ASC Topic 280, but do not meet the quantitative thresholds for segment reporting. The following table presents revenues
less directly identifiable expenses to arrive at operating income net of direct expenses for the Advertising reportable segment, the combined Fathom Events operating segments, and Network,
Administrative and Unallocated costs. Management does not evaluate its segments on a fully allocated cost basis. Therefore, the measure of segment operating income net of direct expenses shown below
is not prepared on the same basis as operating income in the statement of operations and the results below are not indicative of what segment results of operations would have been had it been operated
on a fully allocated cost basis. Management cautions that it would be inappropriate to assume that unallocated operating costs are incurred proportional to segment revenue or any directly identifiable
segment expenses. Unallocated operating costs consist primarily of network costs, general and administrative costs and other unallocated costs including depreciation and amortization. Management does
not track segment assets and, therefore, segment asset information is not presented.

Year Ended December 31, 2009 (in millions)Advertising

Other

Network,
Administrative
and
Unallocated
Costs

TotalRevenue

$
335.1

$
45.5

$
0.1

$
380.7Operating costs


72.7


29.1





101.8Selling and marketing costs


40.6


8.6


1.0


50.2Other costs


2.8


0.9





3.7Operating income, net of direct expenses

$
219.0

$
6.9Network, administrative and other costs








56.8


56.8Total Operating Income










$
168.2




Year Ended January 1, 2009 (in millions)Advertising

Other

Network,
Administrative
and
Unallocated
Costs

TotalRevenue

$
330.3

$
38.9

$
0.3

$
369.5Operating costs


68.5


25.1





93.6Selling and marketing costs


38.5


8.3


1.1


47.9Other costs


2.8


0.8





3.6Operating income, net of direct expenses

$
220.5

$
4.7Network, administrative and other costs








51.2


51.2Total Operating Income










$
173.2


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Table of Contents

11. SEGMENT REPORTING (Continued)



Period February 13, 2007 through
December 27, 2007 (in millions)Advertising

Other

Network,
Administrative
and
Unallocated
Costs

TotalRevenue

$
282.7

$
25.4

$
0.2

$
308.3Operating costs


50.6


15.4





66.0Selling and marketing costs


32.2


7.4


1.3


40.9Other costs


2.4


0.4





2.8Operating income, net of direct expenses

$
197.5

$
2.2Network, administrative and other costs








37.1


37.1Total Operating Income










$
161.5




Period December 29, 2006 through
February 12, 2007 (in millions)Advertising

Other

Network,
Administrative
and
Unallocated
Costs

TotalRevenue

$
20.7

$
2.9




$
23.6Operating costs


15.5


1.4





16.9Selling and marketing costs


4.4


0.8





5.2Other costs


0.3


0.1





0.4Operating income, net of direct expenses

$
0.5

$
0.6Network, administrative and other costs







$
5.2


5.2Total Operating Income (Loss)










$
(4.1
)


The
following is a summary of revenues by category, in millions:

Year Ended
December 31,
2009

Year Ended
January 1,
2009

Period
February 13,
2007 through
December 27,
2007

Period
December 29,
2006 through
February 12,
2007National Advertising Revenue

$
236.8

$
223.1

$
187.1

$
15.3Founding Member Advertising Revenue


36.3


43.3


40.9


Regional Advertising Revenue


62.0


63.9


54.7


5.4Fathom Consumer Revenue


28.6


20.2


8.2


1.4Fathom Business Revenue


16.9


18.7


17.2


1.5Other Revenue


0.1


0.3


0.2


Total Revenues

$
380.7

$
369.5

$
308.3

$
23.6


12. SUBSEQUENT EVENTS

ASC Topic 855-10,Subsequent Events(formerly SFAS No. 165,Subsequent
Events) requires the Company to disclose the date through which subsequent events have been evaluated, as well as whether that date is the date the financial statements were
issued. For the year ended December 31, 2009, the

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Table of Contents

12. SUBSEQUENT EVENTS (Continued)

Company
evaluated, for potential recognition and disclosure, events that occurred prior to the inclusion of the Company's financial statements in NCM, Inc.'s Annual Report on
Form 10-K for the year ended December 31, 2009 on March 9, 2010.

Effective
February 8, 2010, NCM LLC entered into a novation agreement with Lehman Brothers Special Financing Inc. ("Lehman") and Barclays Bank PLC
("Barclays") whereby Lehman transferred to Barclays all the rights, liabilities, duties and obligations of NCM LLC's interest rate swap agreement with Lehman with identical terms.
NCM LLC accepted Barclays as its sole counterparty with respect to the new agreement. The term runs until February 13, 2015, subject to earlier termination upon the occurrence of certain
specified events. Subject to the terms of the new agreement, NCM LLC or Barclays will make payments at specified intervals based on the variance between LIBOR and a fixed rate of 4.984% on a
notional amount of $137,500,000. NCM LLC effectively pays a rate of 6.734% on this notional amount inclusive of the 1.75% margin currently required by NCM LLC's credit agreement. The
agreement with Barclays is secured by the assets of NCM LLC on a pari passu basis with the credit agreement (as defined in Note 6) and the other interest rates swaps that were entered
into by NCM LLC. In consideration of Lehman entering into the transfer, NCM LLC agreed to pay to Lehman the full amount of interest rate swap payments withheld aggregating
$7.0 million and an immaterial amount of default interest. The Company expects to redesignate the Barclays interest rate swap agreement as a cash flow hedge.

Effective
February 3, 2010, LCPI entered into an assignment and assumption agreement with Barclays whereby LCPI transferred to Barclays the remaining unfunded revolving credit
commitment of $6.0 million.

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Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.

MARQUEE HOLDINGS INC.By:

/s/ CHRIS A. COXChris A. CoxChief Accounting OfficerDate:

June 14, 2010


Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on
the dates indicated.

/s/ AARON J. STONE Aaron J. Stone

Chairman of the Board

June 14, 2010/s/ GERARDO I. LOPEZ Gerardo I. Lopez

Chief Executive Officer, Director and President

June 14, 2010/s/ DR. DANA B. ARDI Dr. Dana B. Ardi

Director

June 14, 2010/s/ STEPHEN P. MURRAY Stephen P. Murray

Director

June 14, 2010/s/ STAN PARKER Stan Parker

Director

June 14, 2010/s/ PHILIP H. LOUGHLIN Philip H. Loughlin

Director

June 14, 2010/s/ ELIOT P. S. MERRILL Eliot P. S. Merrill

Director

June 14, 2010


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Table of Contents

/s/ KEVIN MARONI Kevin Maroni

Director

June 14, 2010/s/ TRAVIS REID Travis Reid

Director

June 14, 2010/s/ CRAIG R. RAMSEY Craig R. Ramsey

Executive Vice President and Chief Financial Officer

June 14, 2010/s/ KEVIN M. CONNOR Kevin M. Connor

Senior Vice President, General Counsel and Secretary

June 14, 2010/s/ CHRIS A. COX Chris A. Cox

Senior Vice President and Chief Accounting Officer

June 14, 2010


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Table of Contents

EXHIBIT INDEX

EXHIBIT
NUMBER

DESCRIPTION2.1
(a)
Modified First Amended Joint Plan of Reorganization of Debtors and Official Committee of Unsecured Creditors for GC Companies, Inc. and its Jointly Administered Subsidiaries filed on March 1, 2002 with the
United States Bankruptcy Court for the District of Delaware (incorporated by reference from Exhibit 2.2 to Form 8-K filed March 7, 2002).2.1
(b)
Agreement and Plan of Merger, dated June 20, 2005, by and among Marquee Holdings Inc. and LCE Holdings, Inc. (incorporated by reference from Exhibit 2.1 to the Company's Form 8-K filed on June 24,
2005).2.2

Purchase and Sale Agreement, dated as of March 9, 2002, by and among G.S. Theaters, L.L.C., a Louisiana limited liability Company, Westbank Theatres, L.L.C., a Louisiana limited liability company, Clearview
Theatres, L.L.C., a Louisiana limited liability company, Houma Theater, L.L.C., a Louisiana limited liability company, Hammond Theatres, L.L.C., a Louisiana limited liability company, and American Multi-Cinema, Inc. together with Form of
Indemnification Agreement (Appendix J) (incorporated by reference from Exhibit 2.1 to Form 8-K filed March 13, 2002).2.3

Agreement and Plan of Merger, dated as of July 22, 2004 by and among Marquee Holdings Inc., Marquee Inc. and AMC Entertainment Inc. (incorporated by reference from Exhibit 2.1 to Form 8-K
filed June 23, 2004).2.4

Agreement and Plan of Merger, dated June 11, 2007, by and among AMC Entertainment Holdings, Inc., Marquee Holdings Inc., and Marquee Merger Sub Inc. (incorporated by reference from Exhibit 2.1
to the Company's Form 8-K filed on June 13, 2007)2.5

Unit Purchase Agreement among Kerasotes Showplace Theatres Holdings, LLC, Kerasotes Showplace Theatres, LLC, Showplace Theatres Holding Company, LLC, AMC Showplace Theatres, Inc. and American
Multi-Cinema, Inc. (incorporated by reference from Exhibit 10.1 to the Company's Form 8-K (File No. 1-8747) filed on May 25, 2010)3.1

Third Amended and Restated Certificate of Incorporation of Marquee Holdings Inc. (incorporated by reference from Exhibit 3.1 to the Company's Form 8-K filed on June 13, 2007)3.2

Third Amended and Restated Bylaws of Marquee Holdings Inc. (incorporated by reference from Exhibit 3.2 to the Company's Form 8-K filed on June 13, 2007)4.1
(a)
Pledge and Security Agreement, dated January 26, 2006, by AMC Entertainment Inc. and each of the other Grantors party thereto in favor of Citicorp U.S. and Canada, Inc., as agent for the Secured Parties
(incorporated by reference from Exhibit 10.6 to the Company's Form 8-K (File No. 1-8747) filed January 31, 2006).4.1
(b)
Consent and Release, dated as of April 17, 2006, by and between AMC Entertainment Inc. and Citicorp U.S. and Canada, Inc. (incorporated by reference from Exhibit 4.1(d) to the Company's Form S-4 (File
No. 333-133574) filed April 27, 2006).4.2
(a)
Indenture, dated February 24, 2004, respecting AMC Entertainment Inc.'s 8% Senior Subordinated Notes due 2014. (Incorporated by reference from Exhibit 4.7 to the Company's Registration Statement on
Form S-4 (File No. 333-113911) filed on March 24, 2004).


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Table of Contents

EXHIBIT
NUMBER

DESCRIPTION4.2
(b)
First Supplemental Indenture, dated December 23, 2004, respecting AMC Entertainment Inc.'s 8% Senior Subordinated Notes due 2014 (incorporated by reference from Exhibit 4.7(b) to the Company's Registration
Statement on Form S-4 (File No. 333-122376) filed on January 28, 2005).4.2
(c)
Second Supplemental Indenture, dated January 26, 2006, respecting AMC Entertainment Inc.'s 8% Senior Subordinated Notes due 2014 (incorporated by reference from Exhibit 4.6(c) to the Company's Form 10-Q
filed on February 13, 2006).4.2
(d)
Third Supplemental Indenture dated April 20, 2006, respecting AMC Entertainment Inc.'s 8% Senior Subordinated Notes due 2014 (incorporated by reference from Exhibit 4.6(d) to the Company's Form S-4
(File No. 333-133574) filed April 27, 2006).4.3

Registration Rights Agreement, dated February 24, 2004, respecting AMC Entertainment Inc.'s 8% senior subordinated notes due 2014. (Incorporated by reference from Exhibit 4.8 to the Company's Registration
Statement on Form S-4 (File No. 333-113911) filed on March 24, 2004).4.4

Indenture, dated as of June 9, 2009, respecting AMCE's 8.75% Senior Notes due 2019, by and among AMCE, a Delaware corporation, the Guarantors party thereto from time to time and U.S. Bank National Association, as
Trustee (incorporated by reference from Exhibit 4.1 to AMCE's Current Report on Form 8-K (File No. 001-08747) filed on June 9, 2009).4.5

Registration Rights Agreement, dated as of June 9, 2009, respecting AMCE's 8.75% Senior Notes due 2019, by and among AMCE, the Guarantors party thereto from time to time, Credit Suisse Securities (USA) LLC,
for itself and on behalf of the other Initial Purchasers, and J.P. Morgan Securities Inc., as Market Maker (incorporated by reference from Exhibit 4.2 to AMCE's Current Report on Form 8-K (File No. 001-08747) filed on June 9,
2009).4.6
(a)
Registration Rights Agreement dated August 18, 2004, respecting AMC Entertainment Inc.'s, as successor by merger to Marquee Inc.'s, 85/8% Senior Notes due 2012 (incorporated by
reference from Exhibit 4.10(a) to the Company's Registration Statement on Form S-4 (File No. 333-122376) filed on January 28, 2005).4.6
(b)
Joinder Agreement to Registration Rights Agreement dated December 23, 2004, respecting AMC Entertainment Inc.'s, as successor by merger to Marquee Inc.'s, 85/8% Senior Notes due
2012 (incorporated by reference from Exhibit 4.10(b) to the Company's Registration Statement on Form S-4 (File No. 333-122376) filed on January 28, 2005).4.7
(a)
Indenture, dated January 26, 2006, respecting AMC Entertainment Inc.'s 11% senior subordinated notes due 2016, between AMC Entertainment Inc. and HSBC Bank USA, National Association (incorporated by
reference from Exhibit 4.1 to the Company's Form 8-K (File No. 1-8747) filed on January 31, 2006).4.7
(b)
First Supplemental Indenture dated April 20, 2006, respecting AMC Entertainment Inc.'s 11% Senior Subordinated Notes due 2016 (incorporated by reference from Exhibit 4.12(b) to the Company's Form S-4
(File No. 333-133574) filed April 27, 2006).


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Table of Contents

EXHIBIT
NUMBER

DESCRIPTION4.8

Registration Rights Agreement dated January 26, 2006, respecting AMC Entertainment Inc.'s 11% senior subordinated notes due 2016, among AMC Entertainment Inc., the guarantors party thereto, Credit Suisse
Securities (USA) LLC, Citigroup Global Markets Inc., and J.P. Morgan Securities Inc. (incorporated by reference from Exhibit 4.2 to the company's Form 8-K (File No. 1-8747) filed on January 31, 2006).4.9
(a)
Indenture, dated August 18, 2004, respecting Marquee Holdings Inc.'s 12% Senior Discount Notes due 2014 (incorporated by reference from Exhibit 4.13 to Holdings' Registration Statement on Form S-4
(file No. 333-122636) filed on February 8, 2005).4.9
(b)
Registration Rights Agreement dated August 18, 2004, respecting Marquee Holdings Inc.'s 12% Senior Discount Notes due 2014 (incorporated by reference from Exhibit 4.14 to Holdings' Registration Statement on
Form S-4 (File No. 333-122636) filed on February 8, 2005).4.9
(c)
First Supplemental Indenture dated June 12, 2007, respecting Marque Holding Inc.'s 12% Senior Discount Notes due 2014 (incorporated by reference from Exhibit 4.1 to the Company's Form 8-K Filed on
June 13, 2007).10.1

Consent Decree, dated December 21, 2005, by and among Marquee Holdings Inc., LCE Holdings, Inc. and the State of Washington (incorporated by reference from Exhibit 10.1 to the Company's
Form 8-K (File No. 1- 8747) filed on December 27, 2005).10.2

Hold Separate Stipulation and Order, dated December 21, 2005, by and among Marquee Holdings Inc., LCE Holdings, Inc. and the State of Washington (incorporated by reference from Exhibit 10.2 to the
Company's Form 8-K (File No. 1-8747) filed on December 27, 2005).10.3

Final Judgment, dated December 20, 2005, by and among Marquee Holdings Inc., LCE Holdings, Inc. and the Antitrust Division of the United States Department of Justice (incorporated by reference from
Exhibit 10.3 to the Company's Form 8-K (File No. 1-8747) filed on December 27, 2005).10.4

Hold Separate Stipulation and Order, dated December 20, 2005, by and among Marquee Holdings Inc., LCE Holdings and the Antitrust Division of the United States Department of Justice (incorporated by reference
from Exhibit 10.4 to the Company's Form 8-K (File No. 1-8747) filed on December 27, 2005).10.5

District of Columbia Final Judgment, dated December 21, 2005, by and among Marquee Holdings Inc., LCE Holdings, Inc. and the District of Columbia (incorporated by reference from Exhibit 10.5 to the
Company's Form 8-K (File No. 1-8747) filed on December 27, 2005).10.6

Stipulation for Entry into Final Judgment, dated December 20, 2005, by and among Marquee Holdings Inc., LCE Holdings, Inc. and the State of California (incorporated by reference from Exhibit 10.6
to the Company's Form 8-K (File No. 1-8747) filed on December 27, 2005).10.7

Stipulated Final Judgment, dated December 20, 2005, by and among Marquee Holdings Inc., LCE Holdings, Inc. and the State of California (incorporated by reference from Exhibit 10.7 to the Company's
Form 8-K (File No. 1-8747) filed on December 27, 2005).


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EXHIBIT
NUMBER

DESCRIPTION10.8

Stockholders Agreement of AMC Entertainment Holdings, Inc., dated June 11, 2007, among AMC Entertainment Holdings, Inc. and the stockholders of AMC Entertainment Holdings, Inc. party thereto.
(incorporated by reference from Exhibit 10.3 to the Company's Form 8-K filed on June 13, 2007).10.9

Management Stockholders Agreement of AMC Entertainment Holdings, Inc., dated June 11, 2007, among AMC Entertainment Holdings, Inc. and the stockholders of AMC Entertainment Holdings, Inc. party
thereto. (incorporated by reference from Exhibit 10.4 to the Company's Form 8-K filed on June 13, 2007)10.10

Continuing Service Agreement, dated January 26, 2006, among AMC Entertainment Inc. (as successor to Loews Cineplex Entertainment Corporation) and Travis Reid, and, solely for the purposes of its repurchase
obligations under Section 7 thereto, Marquee Holding Inc. (incorporated by reference from Exhibit 10.1 to the Company's Form 8-K (File No. 1-8747) filed on January 31, 2006).10.11

Non-Qualified Stock Option Agreement, dated January 26, 2006, between Marquee Holdings Inc. and Travis Reid (incorporated by reference from Exhibit 10.2 to the Company's Form 8-K (File
No. 1-8747) filed on January 31, 2006).10.12

Fee Agreement, dated June 11, 2007, by and among AMC Entertainment Holdings, Inc., Marquee Holdings Inc., AMC Entertainment Inc., J.P. Morgan Partners (BHCA), L.P., Apollo Management V,
 L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V, L.P., Apollo Netherlands Partners V(A), L.P., Apollo Netherlands partners V(B), L.P., Apollo German Partners V GmbH & Co KG, Bain
Capital Partners, LLC, TC Group, L.L.C., a Delaware limited liability company and Applegate and Collatos, Inc. (incorporated by reference from Exhibit 10.7 to the Company's Form 8-K filed on June 13, 2007).10.13

American Multi-Cinema, Inc. Savings Plan, a defined contribution 401(k) plan, restated January 1, 1989, as amended (Incorporated by reference from Exhibit 10.6 to AMCE's Form S-1 (File
No. 33-48586) filed June 12, 1992, as amended).10.14
(a)
Defined Benefit Retirement Income Plan for Certain Employees of American Multi-Cinema, Inc., as Amended and Restated, effective December 31, 2006, and as Frozen, effective December 31, 2006 (Incorporated by
reference from Exhibit 10.14(a) to the Company's Form S-1 (File No. 333-139249) filed April 12, 2007, as amended).10.14
(b)
AMC Supplemental Executive Retirement Plan, as Amended and Restated, generally effective January 1, 2006, and as Frozen, effective December 31, 2006 (Incorporated by reference from Exhibit 10.14(b) to the
Company's Form S-1 (File No. 333-139249) filed April 12, 2007, as amended).10.15

Division Operations Incentive Program (Incorporated by reference from Exhibit 10.15 to AMCE's Form S-1 (File No. 33-48586) filed June 12, 1992, as amended).10.16

Summary of American Multi-Cinema, Inc. Executive Incentive Program (Incorporated by reference from Exhibit 10.36 to AMCE's Registration Statement on Form S-2 (File No. 33-51693) filed
December 23, 1993).10.17

American Multi-Cinema, Inc. Retirement Enhancement Plan, as Amended and Restated, effective January 1, 2006, and as Frozen, effective December 31, 2006 (Incorporated by reference from Exhibit 10.19
to the Company's Form S-1 (File No. 333-139249) filed April 12, 2007, as amended).


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Table of Contents

EXHIBIT
NUMBER

DESCRIPTION10.18

AMC Non-Qualified Deferred Compensation Plan, as Amended and Restated, effective January 1, 2005 (Incorporated by reference from Exhibit 10.21 to the Company's Form S-1 (File No. 333-139249) filed
April 12, 2007, as amended).10.19

American Multi-Cinema, Inc. Executive Savings Plan (Incorporated by reference from Exhibit 10.28 to AMCE's Registration Statement on Form S-4 (File No. 333-25755) filed April 24,
1997).10.20

Agreement of Sale and Purchase dated November 21, 1997 among American Multi-Cinema, Inc. and AMC Realty, Inc., as Seller, and Entertainment Properties Trust, as Purchaser (Incorporated by reference from
Exhibit 10.1 of the Company's Current Report on Form 8-K (File No. 1-8747) filed December 9, 1997).10.21

Option Agreement dated November 21, 1997 among American Multi-Cinema, Inc. and AMC Realty, Inc., as Seller, and Entertainment Properties Trust, as Purchaser (Incorporated by reference from
Exhibit 10.2 of the Company's Current Report on Form 8-K (File No. 1-8747) filed December 9, 1997).10.22

Right to Purchase Agreement dated November 21, 1997, between AMC Entertainment Inc., as Grantor, and Entertainment Properties Trust as Offeree (Incorporated by reference from Exhibit 10.3 of the Company's
Current Report on Form 8-K (File No. 1-8747) filed December 9, 1997.)10.23

Lease dated November 21, 1997 between Entertainment Properties Trust, as Landlord, and American Multi-Cinema, Inc., as Tenant (Incorporated by reference from Exhibit 10.4 of the Company's Current Report
on Form 8-K (File No. 1-8747) filed December 9, 1997). (Similar leases have been entered into with respect to the following theatres: Mission Valley 20, Promenade 16, Ontario Mills 30, Lennox 24, West Olive 16, Studio 30 (Houston),
Huebner Oaks 24, First Colony 24, Oak View 24, Leawood Town Center 20, South Barrington 30, Gulf Pointe 30, Cantera 30, Mesquite 30, Hampton Town Center 24, Palm Promenade 24, Westminster Promenade 24, Hoffman Center 22, Elmwood Palace 20, Westbank
Palace 16, Clearview Palace 12, Hammond Palace 10, Houma Palace 10, Livonia 20, Forum 30, Studio 29 (Olathe), Hamilton 24, Deer Valley 30, Mesa Grand 24 and Burbank 16.10.24

Guaranty of Lease dated November 21, 1997 between AMC Entertainment Inc., as Guarantor, and Entertainment Properties Trust, as Owner (Incorporated by reference from Exhibit 10.5 of the Company's Current
Report on Form 8-K (File No. 1-8747) filed December 9, 1997, (Similar guaranties have been entered into with respect to the following theatres: Mission Valley 20, Promenade 16, Ontario Mills 30, Lennox 24, West Olive 16, Studio 30
(Houston), Huebner Oaks 24, First Colony 24, Oak View 24, Leawood Town Center 20, South Barrington 30, Gulf Pointe 30, Cantera 30, Mesquite 30, Hampton Town Center 24, Palm Promenade 24, Westminster Promenade 24, Hoffman Center 22, Elmwood Palace 20,
Westbank Palace 16, Clearview Palace 12, Hammond Palace 10, Houma Palace 10, Livonia 20, Forum 30, Studio 29 (Olathe), Hamilton 24, Deer Valley 30, Mesa Grand 24 and Burbank 16.10.30

Employment agreement between AMC Entertainment Inc., American Multi-Cinema, Inc. and John D. McDonald which commenced July 1, 2001. (Incorporated by Reference from Exhibit 10.29 to Amendment
No. 1 to the Company's Form 10-K (File No. 1-8747) for the year ended March 29, 2001).


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Table of Contents

EXHIBIT
NUMBER

DESCRIPTION10.31

Employment agreement between AMC Entertainment Inc., American Multi-Cinema, Inc. and Craig R. Ramsey which commenced on July 1, 2001. (Incorporated by Reference from Exhibit 10.36 to the Company's
Form 10-Q (File No. 1-8747) for the quarter ended June 27, 2002).10.32

Investment Agreement entered into April 19, 2001 by and among AMC Entertainment Inc. and Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo
Overseas Partners V, L.P., Apollo Management IV, L.P. and Apollo Management V, L.P. (Incorporated by reference from Exhibit 4.7 to the Company's Form 8-K (File No. 1-8747) filed on April 20, 2001).10.33

Standstill Agreement by and among AMC Entertainment Inc., and Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V,
 L.P., Apollo Management IV, L.P. and Apollo Management V, L.P., dated as of April 19, 2001. (Incorporated by reference from Exhibit 4.8 to the Company's Form 8-K (File No. 1-8747) filed on April 20,
2001).10.34

Registration Rights Agreement dated April 19, 2001 by and among AMC Entertainment Inc. and Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo
Overseas Partners V, L.P. (Incorporated by reference from Exhibit 4.9 to the Company's Form 8-K (File No. 1-8747) filed on April 20, 2001).10.35

Securities Purchase Agreement dated June 29, 2001 by and among Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V,
 L.P., Apollo Management IV, L.P., Apollo Management V, L.P., AMC Entertainment Inc., Sandler Capital Partners V, L.P., Sandler Capital Partners V FTE, L.P. and Sandler Capital Partners V Germany, L.P. (Incorporated
by reference from Exhibit 4.6 to the Company's Form 10-Q (File No. 1-8747) for the quarter ended June 28, 2001).10.36

Form of Indemnification Agreement dated September 18, 2003 between the Company and Peter C. Brown, Charles S. Sosland, Charles J. Egan, Jr., Michael N. Garin, Marc J. Rowan, Paul E. Vardeman, Leon D. Black and
Laurence M. Berg (incorporated by reference from Exhibit 10.1 to the Company's Form 10-Q (File No. 1-8747) for the quarter ended January 1, 2004).10.37

2003 AMC Entertainment Inc. Long-Term Incentive Plan (incorporated by reference from Exhibit 10.2 to the Company's Form 10-Q (File No. 1-8747) for the quarter ended October 2,
2003).10.40

Description of 2004 Grant under the 2003 AMC Entertainment Inc. Long-Term Incentive Plan (incorporated by reference from Exhibit 10.3 to the Company's Form 10-Q (File No. 1-8747) for the quarter
ended October 2, 2003).10.41
(a)
AMC Entertainment Holdings, Inc. Amended and Restated 2004 Stock Option Plan. (incorporated by reference from Exhibit 10.9 to the Company's Form 8-K filed on June 13, 2007)10.41
(b)
Form of Non-Qualified Stock Option Agreement (incorporated by reference from Exhibit 10.32(b) to AMCE's Registration Statement on Form S-4 (File No. 333-122376) filed on January 28, 2005).10.41
(c)
Form of Incentive Stock Option Agreement (incorporated by reference from Exhibit 10.32(c) to AMCE's Registration Statement on Form S-4 (File No. 333-122376) filed on January 28, 2005).


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Table of Contents

EXHIBIT
NUMBER

DESCRIPTION10.42

Contribution and Unit Holders Agreement, dated as of March 29, 2005, among National Cinema Network, Inc., Regal CineMedia Corporation and National CineMedia, LLC (incorporated by reference from
Exhibit 10.1 to the Company's Form 8-K filed April 4, 2005).10.43

Exhibitor Services Agreement, dated February 13, 2007 between National CineMedia, LLC and American Multi- Cinema, Inc. (filed as Exhibit 10.2 to the Current Report on Form 8-K (File
No. 001-33296) of National CineMedia, Inc., filed on February 16, 2007, and incorporated herein by reference).10.44

First Amended and Restated Loews Screen Integration Agreement, dated February 13, 2007 between National CineMedia, LLC and American Multi-Cinema, Inc. (filed as Exhibit 10.8 to the Current Report
on Form 8-K (File No. 001-33296) of National CineMedia, Inc., filed on February 16, 2007, and incorporated herein by reference).10.45

Third Amended and Restated Limited Liability Company Operating Agreement, dated February 13, 2007 between American Multi-Cinema, Inc., Cinemark Media, Inc., Regal CineMedia Holdings, LLC and
National CineMedia, Inc. (incorporated by reference from Exhibit 10.3 to the Company's Form 8-K filed February 20, 2007).10.46

Amendment No. 1 to Credit Agreement, dated as of February 14, 2007, between AMC Entertainment Inc., and Citicorp North America, as Administrative Agent (incorporated by reference from Exhibit 10.4
to the Company's Form 8-K filed February 20, 2007).10.47

Amendment No. 2 to Credit Agreement, dated as of March 13, 2007, between AMC Entertainment Inc., and Citicorp North America, as Administrative Agent (incorporated by reference from Exhibit 10.1 to
the Company's Form 8-K filed March 15, 2007).10.48

Employment Agreement, dated as of November 6, 2002, by and among Kevin M. Connor, AMC Entertainment Inc. and American Multi- Cinema, Inc. (incorporated by reference from Exhibit 10.49 to the
Company's Amendment No. 5 to Form S-1 filed on April 19, 2007)10.49

Voting and Irrevocable Proxy Agreement, dated June 11, 2007, among AMC Entertainment Holdings, Inc., Carlyle Partners III Loews, L.P., CP III Coinvestment, L.P., Bain Capital Holdings (Loews) I,
 L.P., Bain Capital AIV (Loews) II, L.P., Spectrum Equity Investors IV, L.P., Spectrum Equity Investors Parallel IV, L.P. and Spectrum IV Investment Managers' Fund, L.P. (incorporated by reference from Exhibit 10.6 to
the Company's Form 8-K (File No. 333-122636) filed on June 13, 2007)10.50

Voting and Irrevocable Proxy Agreement, dated June 11, 2007, among AMC Entertainment Holdings, Inc., J.P. Morgan Partners (BHCA), L.P., J.P. Morgan Partners Global Investors, L.P., J.P. Morgan Partners
Global Investors (Cayman), L.P., J.P. Morgan Partners Global Investors (Cayman) II, L.P., J.P. Morgan Partners Global Investors (Selldown), L.P., J.P. Morgan Partners Global Investors (Selldown) II, L.P., JPMP Global
Fund/AMC/Selldown II, L.P., J.P. Morgan Partners Global Investors (Selldown) II-C, L.P., AMCE (Ginger), L.P., AMCE (Luke), L.P., AMCE (Scarlett), L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V,
 L.P., Apollo Netherlands Partners V(A), L.P., Apollo Netherlands Partners V(B), L.P., Apollo German Partners V GmbH & Co KG and other co-investors. (incorporated by reference from Exhibit 10.5 to the Company's
Form 8-K (File No. 333-122636) filed on June 13, 2007)


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Table of Contents

EXHIBIT
NUMBER

DESCRIPTION10.51

Amended and Restated Certificate of Incorporation of AMC Entertainment Holdings, Inc. (incorporated by reference from Exhibit 10.1 to the Company's Form 8-K filed on June 13, 2007)10.52

Amended and Restated Bylaws of AMC Entertainment Holdings, Inc. (incorporated by reference from Exhibit 10.2 to the Company's Form 8-K filed on June 13, 2007)10.53

Employment Agreement, dated as of November 6, 2002, by and among Kevin M. Connor, AMC Entertainment Inc. and American Multi- Cinema, Inc. (incorporated by reference from Exhibit 10.49 to the
Company's Form 10-K (File No. 1-8747) filed on June 15, 2007).10.54

Voting and Irrevocable Proxy Agreement, dated June 11, 2007, among AMC Entertainment Holdings, Inc., Carlyle Partners III Loews, L.P., CP III Coinvestment, L.P., Bain Capital Holdings (Loews) I,
 L.P., Bain Capital AIV (Loews) II, L.P., Spectrum Equity Investors IV, L.P., Spectrum Equity Investors Parallel IV, L.P. and Spectrum IV Investment Managers' Fund, L.P. (incorporated by reference from Exhibit 10.6 to
the Company's 8-K (File No. 1-8747) filed on June 13, 2007).10.55

Voting and Irrevocable Proxy Agreement, dated June 11, 2007, among AMC Entertainment Holdings, Inc., J.P. Morgan Partners (BHCA), L.P., J.P. Morgan Partners Global Investors, L.P., J.P. Morgan Partners
Global Investors (Cayman), L.P., J.P. Morgan Partners Global Investors (Cayman) II, L.P., J.P. Morgan Partners Global Investors (Selldown), L.P., J.P. Morgan Partners Global Investors (Selldown) II, L.P., JPMP Global
Fund/AMC/Selldown II, L.P., J.P. Morgan Partners Global Investors (Selldown) II-C, L.P., AMCE (Ginger), L.P., AMCE (Luke), L.P., AMCE (Scarlett), L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V,
 L.P., Apollo Netherlands Partners V(A), L.P., Apollo Netherlands Partners V(B), L.P., Apollo German Partners V GmbH & Co KG and other co-investors. (incorporated by reference from Exhibit 10.5 to the Company's 8-K
(File No. 1-8747) filed on June 13, 2007).10.56

Employment Agreement, dated as of July 1, 2001 by and among Mark A. McDonald, AMC Entertainment Inc. and American Multi-Cinema, Inc. (incorporated by reference from Exhibit 10.48 to the Company's
Form 10-K (File No. 1-8747) filed on June 18, 2008)10.57

Amendment to Stock Purchase Agreement dated as of November 5, 2008 among Entretenimiento GM de Mexico S.A. de C.V., as Buyer, and AMC Netherlands HoldCo B.V., LCE Mexican Holdings, Inc., and AMC
Europe S.A., as sellers (incorporated by reference from Exhibit 10.2 to the Company's Form 8-K (File No. 1-33344) filed January 5, 2009).10.58

Stock Purchase Agreement dated as of November 5, 2008 among Entretenimiento GM de Mexico S.A. de C.V., as Buyer, and AMC Netherlands HoldCo B.V., LCE Mexican Holdings, Inc., and AMC
Europe S.A., as sellers (filed as Exhibit 10.1 to the Company's Form 10-Q (File No. 1-33344) filed on November 17, 2008).10.59

Amendment to Exhibitor Services Agreement dated as of November 5, 2008, by and between National CineMedia, LLC and American Multi-Cinema, Inc. (filed as Exhibit 10.1 to the Current Report on
Form 8-K (File No. 001-33296) of National CineMedia, Inc., filed on February 6, 2008, and incorporated herein by reference)10.60

Separation and General Release Agreement, dated as of February 23, 2009, by and between Peter C. Brown, AMC Entertainment Holdings, Inc., Marquee Holdings Inc. and AMC Entertainment Inc.
(incorporated by reference from Exhibit 10.1 to the Company's Form 8-K (File No. 1-33344) filed on February 25, 2009)


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Table of Contents

EXHIBIT
NUMBER

DESCRIPTION10.61

Employment Agreement, dated as of February 23, 2009, by and between Gerardo I. Lopez and AMC Entertainment Inc. (incorporated by reference from Exhibit 10.2 to the Company's Form 8-K (File
No. 1-33344) filed on February 25, 2009)*10.62

Employment Agreement, dated as of April 17, 2009, by and between Robert J. Lenihan and AMC Entertainment Inc.*10.63

Employment Agreement, dated as of July 1, 2001, by and between Samuel D. Gourley and AMC Entertainment Inc.14

Code of Ethics (incorporated by reference from Exhibit 14 to AMCE's Form 10-K filed on June 23, 2004).16

Letter from PricewaterhouseCoopers LLP to the Securities and Exchange Commission dated October 2, 2009 (filed as exhibit 16.1 to the Company's Form 8-K (File No. 1-8747, filed on
October 2, 2009).*21

Subsidiaries of Marquee Holdings Inc.*31.1

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Acts of 2002.*31.2

Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Acts of 2002.*32.1

Section 906 Certifications of Gerardo I. Lopez (Chief Executive Officer) and Craig R. Ramsey (Chief Financial Officer) furnished in accordance with Securities Act Release 33-8212.


*Filed
herewith.


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