Exhibit 10.2


 


	
   

  	
  RECEIVED

  	
   

  	
  FILED

  	
  ENTERED

  
	
   

  	
   

  	
   

  	
  LODGED

  	
  RECEIVED

  
	
   

  	
  DEC 21, 2005

  	
   

  	
  *

  	
  DEC 21, 2005

  	
  *

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BADGLEY-MULLINS
  LAW GROUP

  	
  AT SEATTLE

  
	
   

  	
   

  	
  CLERK U.S.
  DISTRICT COURT

  
	
   

  	
   

  	
  WESTERN DISTRICT
  OF WASHINGTON

  
	
   

  	
   

  	
  BY                                                 
                  DEPUTY

  
							



 


The Honorable                                          


 


UNITED STATES DISTRICT COURT


WESTERN DISTRICT OF WASHINGTON


AT SEATTLE


 


	
  STATE OF WASHINGTON,

  	
   

  	
  NO.

  	
  CV05-2111

  
	
   

  	
   

  	
   

  
	
  Plaintiff,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  v.

  	
   

  	
  HOLD SEPARATE

  
	
   

  	
   

  	
  STIPULATION AND ORDER

  
	
   

  	
   

  	
   

  
	
  MARQUEE
  HOLDINGS, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  and

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  LCE
  HOLDINGS, INC.,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Defendants.

  	
   

  	
   

  



 


HOLD
SEPARATE STIPULATION AND ORDER


 


It is hereby stipulated by and between the undersigned parties, subject
to approval and entry by this Court, that:


 


	
  HOLD SEPARATE STIPULATION
  AND

  ORDER

  	
  ATTORNEY GENERAL
  OF WASHINGTON

  900 Fourth Avenue, Suite 2000

  



 


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I.
DEFINITIONS


 


As used in this Consent Decree:


 


A.                                   “Acquirer” means the entity to whom
defendants divest the Theater Assets.


 


B.                                     “AMC” means defendant Marquee Holdings, Inc.,
a Delaware corporation with its headquarters in Kansas City, Missouri, its
successors and assigns, and its subsidiaries, divisions, groups, affiliates,
partnerships and joint ventures, and their directors, officers, managers,
agents, and employees.


 


C.                                     “Loews” means defendant LCE Holdings, Inc.,
a Delaware corporation with its headquarters in New York City, New York, its
successors and assigns, and its subsidiaries, divisions, groups, affiliates,
partnerships and joint ventures, and their directors, officers, managers,
agents, and employees.


 


D.                                    “Landlord Consent” means any contractual
approval or consent that the landlord or owner of one or more of the Theater
Assets, or the property on which one or more of the Theater Assets is situated,
must grant prior to the transfer of one of the Theater Assets to an Acquirer.


 


E.                                      “Theater Assets” means the first-run,
commercial motion picture theater business currently operating under the
following name and at the following location: Meridian 16, at 1501 7th Ave.
Seattle, WA. The term “Theater Assets” includes:


 


(1) all tangible assets that comprise the first-run, commercial
motion picture theater business including all equipment, fixed assets and
fixtures, personal property, inventory, office furniture, materials, supplies,
and other tangible property and all assets used in connection with


 


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the
Theater Assets; all licenses, permits and authorizations issued by any governmental
organization relating to the Theater Assets; all contracts, agreements, leases,
commitments, certifications, and understandings, relating to the Theater
Assets, including supply agreements; all customer lists, contracts, accounts,
and credit records; all repair and performance records and all other records
relating to the Theater Assets;


 


(2) all intangible assets used in the
development, production, servicing and sale of Theater Assets, including, but
not limited to all licenses and sublicenses, intellectual property, technical
information, computer software (except defendants’ proprietary software) and
related documentation, know-how, drawings, blueprints, designs, specifications
for materials, specifications for parts and devices, quality assurance and
control procedures, all technical manuals and information defendants provide to
their own employees, customers, suppliers, agents or licensees, and all
research data relating to the Theater Assets; provided, however, that this term
does not include (a) any right to use or interest in defendants’
copyrights, trademarks, trade names, service marks or service names, or (b) assets
that the defendants do not own and are not legally able to transfer.


 


II.
OBJECTIVES


 


The Consent Decree filed
in this civil action is meant to ensure the Defendants’ prompt divestiture of
the Theater Assets for the purpose of establishing viable competitors in the
exhibition of first-run, commercial motion pictures in order to remedy the
effects that the State of Washington alleges would otherwise result from AMC’s
acquisition of Loews. This Hold Separate Stipulation and Order ensures, prior
to such divestiture, that (1) the Loews Theater Assets will remain
independent, economically viable and ongoing business concerns that will


 


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remain independent and
uninfluenced by AMC, (2) that the AMC Theater Assets will remain
economically viable and ongoing business concerns, and (3) that
competition in the various markets in which these theaters are located is
maintained and not diminished during the pendency of the ordered divestiture.


 


III.
JURISDICTION AND VENUE.


 


This Court has
jurisdiction over the subject matter of this action and over each of the
parties hereto, and venue of this action is proper in the United States
District Court for the Western District of Washington.


 


IV.
COMPLIANCE WITH AND ENTRY OF CONSENT DECREE


 


A.                                   The
parties stipulate that a Consent Decree in the form hereto attached as Exhibit A,
may be filed with and entered by this Court, upon the motion of any party or
upon this Court’s own motion and without further notice to any party or other
proceedings, provided that the State of Washington has not withdrawn its
consent, which it may do at any time before the entry of the proposed Consent
Decree by serving notice thereof on Defendants and by filing that notice with
this Court.


 


B.                                     Defendants shall abide by and comply with the
provisions of the proposed Consent Decree, pending the entry of the Consent
Decree by this Court, or until expiration of time for all appeals of any court
ruling declining entry of the proposed Consent Decree. From the date of the
signing of this Hold Separate Stipulation and Order by the parties, the
Defendants shall comply with all the terms and provisions of the proposed
Consent Decree as though the same were in full force and effect as an order of
this Court.


 


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C.                                     Defendants shall not consummate the
transaction sought to be enjoined by the Complaint herein before the Court has
signed this Hold Separate Stipulation and Order.


 


D.                                    This Hold Separate Stipulation and Order
shall apply with equal force and effect to any amended proposed Consent Decree
agreed upon in writing by the parties and submitted to this Court.


 


E.                                      In the event that (1) the proposed
Consent Decree is not entered pursuant to this Hold Separate Stipulation and
Order, the time has expired for all appeals of any court ruling declining entry
of the proposed Consent Decree, and this Court has not otherwise ordered
continued compliance with the terms and provisions of the proposed Consent
Decree, or (2) the State of Washington has withdrawn its consent, as
provided in Section IV(A) above, then the parties are released from
all further obligations under this Hold Separate Stipulation and Order, and the
making of this Hold Separate Stipulation and Order shall be without prejudice
to any party in this or any other proceeding.


 


F.                                      Defendants represent that the divestiture
ordered in the proposed Consent Decree can and will be made, and that the
Defendants will later raise no claim of mistake, hardship, or difficulty of
compliance as grounds for asking this Court to modify any of the provisions
contained therein.


 


V. HOLD
SEPARATE PROVISIONS


 


Until each divestiture
required by the Consent Decree has been accomplished:


 


A.                                   Defendants
shall, except as is necessary to carry out their obligations under this Hold
Separate Stipulation and Order and the proposed Consent Decree, or to comply
with


 


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other legal obligations,
take all steps necessary to ensure that (1) the Loews Theater Assets will
be maintained and operated as independent, ongoing, economically viable and
active competitors in the exhibition of first-run, commercial motion pictures; (2) the
AMC Theater Assets will be maintained and operated as ongoing, economically
viable and active competitors in the exhibition of first-run, commercial motion
pictures; (3) the management of the Loews Theater Assets will not be
influenced by AMC; and (4) the books, records, competitively sensitive
sales, marketing, and pricing information, and decision making associated with
Loews Theater Assets will be kept separate and apart from AMC’s other
operations. Within twenty (20) days after the entry of the Hold Separate
Stipulation and Order, the Defendants will inform the State of Washington of
the steps taken to comply with the Hold Separate Stipulation and Order.


 


B.                                     Defendants shall use all reasonable efforts
to maintain and increase the sales, and revenue of the Theater Assets, and
shall maintain research, design, product and service improvement, promotional,
advertising, sales, technical assistance, marketing, and merchandising support
for the Theater Assets at 2005 or previously approved 2006 levels, whichever
arc higher.


 


C.                                     Defendants shall provide sufficient working
capital and lines and sources of credit to continue to maintain the Theater
Assets as economically viable and competitive, ongoing businesses, consistent
with the requirements of Sections V(A) and 

V(B).


 


D.                                    Defendants shall take all steps necessary to
ensure that the Theater Assets are fully maintained in operable condition at no
less than current capacity, and shall maintain and


 


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adhere to normal product
and Service improvement, upgrade, repair, and maintenance schedules for the
Theater Assets.


 


E.                                      Defendants shall not, except as part of a
divestiture approved by the State of Washington accordance with the terms of
the proposed Consent Decree, remove, sell, lease, assign, transfer, pledge, or
otherwise dispose of any of the Theater Assets.


 


F.                                      Defendants shall maintain, in accordance with
sound accounting principles, separate, accurate and complete financial ledgers,
books, and records that report on a periodic basis, such as the last business
day of every month, consistent with past practices, the assets, liabilities,
expenses, revenues, and income of the Theater Assets.


 


G.                                     Defendants shall take no action that would
jeopardize, delay, or impede the sale of the Theater Assets.


 


H.                                    Defendants shall not hire, transfer,
terminate, or reduce the salary agreements of any employee whose primary
responsibilities relate to the Theater Assets, except for transfer bids
initiated by employees pursuant to the Defendants’ regular, established
job-posting policy or as is otherwise consistent with this Hold Separate
Stipulation and Order. Defendants shall provide the State of Washington with
ten (10) calendar days notice of any such transfer.


 


I.                                         Within ten (10) days of the entry of
this Hold Separate Stipulation and Order the Defendants shall appoint, subject
to the approval of the State of Washington, a person or persons to oversee the
Theater Assets, respectively, who will also be responsible for the Defendants’
compliance with this section. This person or persons shall have complete
managerial responsibility for the Theater Assets, respectively, subject to the
provisions of the


 


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Consent Decree.  In the event that any such person is unable to
perform his or her duties the Defendants shall appoint, subject to the approval
of the State of Washington, a replacement within ten (10) working days.
Should the Defendants fail to appoint a replacement acceptable to the State of
Washington within this time period, the State of Washington shall appoint a
replacement.


 


J.                                        Defendants shall take no action that would
interfere with the ability of any trustee appointed pursuant to the Consent
Decree to complete the divestiture[s] required by the Consent Decree to
Acquirers acceptable to the State of Washington.


 


K.                                    This Hold Separate Stipulation and Order
shall remain in effect until consummation of the divestiture required by the
proposed Consent Decree or until further order of the Court.


 


VI. ORDER


 


It is SO ORDERED this          day
of                    2005.


 


	
   

  	
   

  	
   

  
	
   

  	
   

  	
  UNITED STATES DISTRICT
  JUDGE

  



 


Respectfully submitted
by:


 


ROB MCKENNA


Attorney General of
Washington State


 


TINA E. KONDO,


Senior Assistant Attorney
General


Antitrust Division Chief


 


 


	
  /s/ Mark
  O. Brevard

  	
   

  
	
  MARK O. BREVARD, WSBA
  #21228

  	
   

  
	
  Assistant Attorney
  General

  
	
  900 Fourth Avenue Suite 2000

  
	
  Seattle, WA 98164

  
	
  (206) 464-7030

  
	
  Dated: 

  	
  12-21-05

  	
   

  
				



 


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FOR DEFENDANT AMC:


 


 


	
  /s/
  Duncan C. Turner

  	
   

  
	
  DUNCAN C. TURNER, WSBA
  #20597

  	
   

  
	
  Counsel for Defendant

  	
   

  
	
  Badgley Mullins Law
  Group PLLC

  701 Fifth Avenue, Suite 4750

  Seattle, WA 98104

  Tel: (206) 340-5907

  Fax: (206) 621-6566

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Damian
  G. Didden

  	
   

  
	
  DAMIAN G. DIDDEN (Pro
  Hac Vice)

  	
   

  
	
  ILENE KNABLE GOTTS (Pro
  Hac Vice)

  	
   

  
	
  Wachtell, Lipton, Rosen &
  Katz

  	
   

  
	
  51 West 52nd Street

  	
   

  
	
  New York, NY 10019

  	
   

  
	
  Tel: (212) 403-1113

  	
   

  
	
  Fax: (212) 403-2113

  	
   

  
			



 


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FOR DEFENDANT LOEWS:


 


 


	
  /s/
  Ramona M. Emerson

  	
   

  
	
  RAMONA
  M. EMERSON, WSBA #20956

  Counsel for Defendant

  Preston Gates & Ellis LLP

  925 Fourth Avenue

  Suite 2900

  Seattle, WA 98104-1158

  Tel: (206) 370-6748

  Fax: (206) 370-6058

  	
   

  
	
  Dated:

  	
  12/20/05

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Deborah L. Feinstein

  	
   

  
	
  DEBORAH
  L. FEINSTEIN (Pro Hac Vice)

  	
   

  
	
  Counsel
  for Defendant

  	
   

  
	
  Arnold &
  Porter LLP

  555 Twelfth Street, NW

  Washington, DC 20004

  Tel: (202) 942-5015

  Fax: (202) 942-5999

  	
   

  
	
  Dated:

  	
  Dec. 19,
  2005

  	
   

  	
   

  



 


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