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

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FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended January 1, 2004

Commission file number:333-87930

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Regal Cinemas Corporation(Exact name of Registrant as Specified in its Charter)

|DelawareState or Other Jurisdiction of
Incorporation or Organization)  |  | 02-0624987(Internal Revenue Service
Employer Identification Number)
|---------------------------------------------------------------------- |  | -------------------------------------------------------------------
|7132 Regal Lane,
Knoxville, TN(Address of Principal Executive Offices) |  | 37918(Zip Code)                                                    

Registrant's
Telephone Number, Including Area Code:865/922-1123

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

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

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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 if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the 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 an accelerated filer (as defined in Exchange Act
Rule 12b-2). Yes o    No ý

The registrant is a wholly owned subsidiary of Regal Entertainment Group. As of June 26, 2003, there were no shares of voting or non-voting
common equity held by non-affiliates of the registrant.

Common
Stock7,500,000 shares outstanding at March 31, 2004.



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TABLE OF CONTENTS



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|PART II 
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|PART III
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|PART IV 
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REGAL CINEMAS CORPORATION

PART I

The information in this Form 10-K contains certain forward-looking statements, including statements related to trends
in the Company's business. The Company's actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include those
discussed in "Business" as well as those discussed elsewhere in this Form 10-K.

Item 1. BUSINESS

THE COMPANY

Regal Cinemas Corporation, a Delaware corporation organized on January 29, 2002 ("we," "us," "our," the "Company" or "Regal Cinemas"), is the parent
company of Regal Cinemas, Inc. ("RCI") and its subsidiaries, which include Edwards Theatres, Inc. ("Edwards"), Regal CineMedia Corporation ("RCM"), Hoyts Cinemas Corporation ("Hoyts"),
and United Artists Theatre Group LLC ("UATG"). The terms RCI, Edwards, RCM, Hoyts and UATG shall be deemed to include the respective subsidiaries of such entities when used in discussions included
herein regarding the current operations or assets of such entities.

As
described in Note 1 to the consolidated financial statements included in Part II, Item 8, of this Form 10-K, which is incorporated herein by
reference, on January 29, 2002, RCI became a wholly owned subsidiary of Regal Cinemas when The Anschutz Corporation and its subsidiaries ("Anschutz") and the other shareholders of RCI exchanged
their common stock of RCI for an aggregate of 7,500,000 shares of common stock of Regal Cinemas. Regal Cinemas was formed for the primary purpose of becoming a borrower under the senior credit
facilities described below and the issuer of the $200 million of 93/8% senior subordinated notes due 2012 issued upon RCI's emergence from bankruptcy.

Each
of the theatre circuits operated by RCI and Edwards emerged from bankruptcy reorganization under Chapter 11 of Title 11 of the United States Code prior to the Company's acquisition
of such entities. For a detailed discussion of these bankruptcy proceedings, see Notes 1 and 8 to the accompanying consolidated financial statements.

We
became a wholly owned subsidiary of Regal Entertainment Group ("REG") on April 12, 2002 in conjunction with an exchange transaction in which REG, through its wholly owned
subsidiary Regal Entertainment Holdings, Inc. ("REH"), also acquired Edwards and RCM. REG is controlled by Anschutz, which controlled each of us, Edwards and RCM prior to REG's acquisition of
us and them in the exchange transaction. Following the exchange transaction, RCI acquired Edwards, RCM, Hoyts and UATG from REH or REG in a series of transactions discussed in Note 4 to the
accompanying consolidated financial statements. The Company manages its business under one reportable segmenttheatre exhibition operations.

Our
Internet address is www.regalcinemas.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on
Form 8-K, and any amendments to these reports, are available free of charge on our Internet website under the heading "Investor Relations" as soon as reasonably practicable after we
electronically file such material with, or furnish it to, the Securities and Exchange Commission.

DESCRIPTION OF BUSINESS

Overview

Regal Cinemas operates the largest and most geographically diverse theatre circuit in the United States, consisting of 5,110 screens in 430 theatres in 37 states
as of January 1, 2004, with over

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225 million
annual attendees for the fifty-three week fiscal year ended January 1, 2004. In addition, Regal Cinemas operates 935 screens in 120 theatres for United Artists Theatre
Circuit, Inc. ("United Artists"), a subsidiary of REG, pursuant to a management agreement. The Company's geographically diverse circuit includes theatres in 9 of the top 10 and 43 of the top 50
U.S. designated market areas, which includes locations in suburban growth areas. The Company primarily operates multi-screen theatres and has an average of 11.9 screens per location, which is well
above the 2003 average of 5.9 screens per location for the North American motion picture exhibition industry. The Company develops, acquires and operates multi-screen theatres primarily in
mid-sized metropolitan markets and suburban growth areas of larger metropolitan markets throughout the U.S. The Company seeks to locate each theatre where it will be the sole or leading
exhibitor within a particular geographic film-licensing zone. Management believes that at January 1, 2004, approximately 86.9% of our screens were located in film licensing zones in
which we are the sole exhibitor. RCM focuses exclusively on the expansion of ancillary businesses, such as advertising, and the creation of new complementary business lines that leverage the Company's
existing asset and customer bases. The Company believes the size, reach and quality of its theatre circuit provide an exceptional platform to realize economies of scale in its theatre operations and
capitalize on RCM's ancillary revenue opportunities. RCM has developed our Regal Digital Content NetworkSM ("DCN"), the largest digital video and communications network in the world.

INDUSTRY OVERVIEW

The domestic motion picture exhibition industry has historically maintained steady growth in revenues and attendance. Since 1965, total box office revenues have
grown at a compound annual growth rate of approximately 6% and annual attendance grew to approximately 1.6 billion attendees in 2003. The industry has been relatively unaffected by downturns in
the economic cycle, with total box office revenues and attendance growing in three of the last five recessions. For example, 2003 was a steady year for the film exhibition industry in which total box
office revenues of $9.5 billion approximated that of a record 2002, while attendance declined by approximately 4% to 1.6 billion attendees.

During
the late 1990's, however, the domestic motion picture exhibition industry underwent a period of extraordinary new theatre construction and the upgrade of older theatres. From 1996
to 1999, the number of screens increased at a compound annual growth rate of approximately 8%, which was more
than double the industry's screen growth rate of approximately 3.5% from 1965 to 1995. The aggressive building strategies undertaken by exhibitors resulted in intensified competition in once stable
markets and rendered many older theatres obsolete more rapidly than anticipated. This effect, together with the fact that many older theatres were under long-term,
non-cancelable leases, created an oversupply of screens, which caused both attendance per screen and revenue and operating income per screen to decline. Most major exhibitors used
extensive debt financing to fund their expansion efforts and experienced significant financial challenges in 1999 and 2000.

In
2000 and 2001, substantially all of the major exhibitors of motion pictures reduced their expansion plans and implemented screen rationalization plans to close under-performing
theatres. During this period, the number of screens declined by approximately 1,800, the first screen decline since 1963. This screen count rationalization has benefited exhibitors as many patrons of
closed theatres have migrated to remaining theatres, thereby increasing industry-wide attendance per screen and operating efficiencies.

The
recent industry expansion was primarily driven by major exhibitors upgrading their asset bases to an attractive megaplex format that typically included 10 or more screens per theatre
and adding enhanced features such as stadium seating, improved projection quality and superior sound systems. From 1996 to 1999, the five largest motion picture exhibitors spent in the aggregate over
$4.1 billion on capital expenditures to expand and upgrade their theatre circuits. As a result of the extensive capital

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investment
over the last several years, we believe future capital expenditures needed to maintain these modern theatres will be modest.

We
believe that another evolution of theatre formats beyond the current megaplex is unlikely to occur in the foreseeable future. We believe theatres larger than the current 10 to 18
screen megaplex are not able to generate attractive returns in most locations because of the substantial market suitability requirements to generate a level of profitability similar to the current
megaplex format. In addition, for the foreseeable future, we do not believe that additional major amenities will be required to meaningfully enhance the moviegoing experience. Consequently, we believe
major exhibitors have reduced capital spending and the rate of new screen growth substantially.

INDUSTRY TRENDS

We believe that the U.S. motion picture exhibition industry will benefit from the following trends:

Increased Marketing of New Releases by Studios.Movie studios have increased marketing expenditures
per new film at a compound annual growth rate of approximately 12% from 2000 to 2003. Because domestic movie theatres are the primary distribution channel for domestic film releases, the theatrical
success of a film is often the most important factor in establishing its value in other film distribution channels, including home video, cable television, broadcast television and international
releases. We believe that movie studios have placed an increased emphasis on theatrical success because these secondary distribution channels represent important and growing sources of additional
revenues.

Affordable and Attractive Form of Entertainment.We believe that patrons are attending movies more
frequently because movie-going is convenient, affordable and attractively priced relative to other forms of out-of-home entertainment. The average price per patron continues to
compare favorably to other out-of-home entertainment alternatives such as concerts and sporting events. Since 1993, average movie ticket prices have increased at a compound
annual growth rate of only 3%, while ticket prices for professional sporting events and concerts have increased at approximately three times that rate. Over the same time period, per capita movie
attendance has grown from 4.8 to 5.4 times per year.

Modern Facilities Lower Future Capital Requirements.We believe that the modern, 10 to 18 screen
megaplex theatre is the appropriate facility for most markets. Over the last several years, major exhibitors have spent substantial capital upgrading their asset bases, including the development of
the megaplex format and introducing enhanced amenities such as stadium seating and digital sound. Given the substantial capital spent on theatre circuit expansion and facilities upgrades, we believe
that major exhibitors have reduced their capital spending for new theatre construction or further upgrades.

Increasing Appeal of a Diversity of Films.Box office revenues are increasingly diversified among a
number of strong movies rather than concentrated on a few major "hits." This increased appeal in the breadth of films benefits exhibitors by expanding the demographic base of moviegoers and generating
greater attendance at a wider variety of movies as opposed to attracting patrons to only a few major releases.

Extension of Movie Release Calendar Reduces Seasonality.Distributors have increasingly staggered new
releases over more weekends as opposed to opening multiple movies on the same weekend or saving major releases for only a few holiday weekends. This trend has reduced the seasonality of box office
revenues by spreading attendance over an extended period of time, which we believe benefits exhibitors by increasing admissions and concessions revenues.

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THEATRE OPERATIONS

We operate the largest theatre circuit in the United States with 5,110 screens in 430 theatres in 37 states as of January 1, 2004. We operate theatres in 9
of the top 10 and 43 of the top 50 U.S. designated market areas, which include locations in suburban growth areas. We target prime locations with excellent access to large, high patron-traffic areas.
We operate our theatre circuit using our Regal Cinemas, Edwards and United Artists brands through our wholly owned subsidiaries, RCI, Edwards, Hoyts and UATG.

We
primarily operate multi-screen theatres. Our multi-screen theatre complexes typically contain 10 to 18 screens, each with auditoriums ranging from 100 to 500 seats. As a result, our
theatres appeal to a diverse group of patrons because we offer a wide selection of films and convenient show times. In addition, many of our theatres feature modern amenities such as
wall-to-wall screens, digital stereo surround-sound, multi-station concessions stands, computerized ticketing systems, plush stadium seating with cup holders and retractable
armrests, neon-enhanced interiors and exteriors and video game areas adjacent to the theatre lobby.

Our
modern, multi-screen theatres are designed to increase profitability by optimizing revenues per square foot and reducing the cost per square foot of operation. We vary auditorium
seating capacities within the same theatre, allowing us to exhibit films on a more cost effective basis for a longer period of time by shifting films to smaller auditoriums to meet changing attendance
levels. In addition, we realize significant operating efficiencies by having common box office, concessions, projection, lobby and restroom facilities, which enables us to spread some of our costs,
such as payroll, advertising and rent, over a higher revenue base. We stagger movie show times to reduce staffing requirements and lobby congestion and to provide more desirable parking and traffic
flow patterns. In addition, we believe that operating a theatre circuit consisting primarily of modern theatres enhances our ability to attract patrons.

The
following table details the number of locations and theatre screens in our theatre circuit ranked by the number of screens in each state as of January 1, 2004:

|State          |  | Locations |  | Number of
Screens |  | State          |  | Locations |  | Number of
Screens
|-------------- |  | --------- |  | ----------------- |  | -------------- |  | --------- |  | -----------------
|California     |  | 68        |  | 827               |  | Idaho          |  | 7         |  | 63               
|Florida        |  | 42        |  | 601               |  | Indiana        |  | 5         |  | 63               
|New York       |  | 33        |  | 399               |  | North Carolina |  | 6         |  | 61               
|Washington     |  | 37        |  | 329               |  | New Mexico     |  | 7         |  | 52               
|Ohio           |  | 25        |  | 296               |  | New Hampshire  |  | 5         |  | 46               
|Virginia       |  | 22        |  | 253               |  | Alaska         |  | 5         |  | 43               
|Georgia        |  | 15        |  | 223               |  | Maine          |  | 4         |  | 38               
|Oregon         |  | 25        |  | 208               |  | Minnesota      |  | 2         |  | 36               
|Pennsylvania   |  | 18        |  | 247               |  | Missouri       |  | 2         |  | 36               
|Texas          |  | 14        |  | 204               |  | Delaware       |  | 2         |  | 33               
|Tennessee      |  | 13        |  | 154               |  | Connecticut    |  | 3         |  | 31               
|New Jersey     |  | 9         |  | 121               |  | Oklahoma       |  | 2         |  | 26               
|Alabama        |  | 9         |  | 118               |  | West Virginia  |  | 2         |  | 22               
|Massachusetts  |  | 10        |  | 110               |  | Louisiana      |  | 2         |  | 20               
|South Carolina |  | 8         |  | 89                |  | Arkansas       |  | 1         |  | 16               
|Nevada         |  | 6         |  | 84                |  | Kentucky       |  | 1         |  | 16               
|Colorado       |  | 8         |  | 82                |  | Wisconsin      |  | 1         |  | 16               
|Maryland       |  | 6         |  | 72                |  | Michigan       |  | 1         |  | 8                
|Illinois       |  | 4         |  | 67                |  |                |  |           |  |                  

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In
connection with the combination of our theatre circuits, we have implemented best management practices across all of our theatres, including daily, weekly and monthly management
reports generated for each individual theatre, as well as maintaining active communication between the theatres, divisional management and corporate management. We use these management reports and
communications to closely monitor admissions and concessions revenues as well as accounting, payroll and workforce information necessary to manage our theatre operations effectively and efficiently.

We
seek experienced theatre managers and require new theatre managers to complete a comprehensive training program within the theatres and at the "Regal University," which is held at our
corporate headquarters. The program is designed to encompass all phases of theatre operations, including our operating philosophy, policies, procedures and standards. In addition, we have an incentive
compensation program for theatre-level management that rewards theatre managers for controlling operating expenses while complying with our operating standards.

In
addition, we have implemented quality assurance programs in all of our theatres to maintain clean, comfortable and modern facilities. To maintain quality and consistency within our
theatre circuit, district and regional managers regularly inspect each theatre. We also operate a "mystery shopper" program, which involves unannounced visits by unidentified customers who report on
the quality of service, film presentation and cleanliness at individual theatres.

REGAL CINEMEDIA OPERATIONS

RCM focuses on the expansion of ancillary businesses, such as advertising, and the creation of new complementary business lines that utilize our existing theatre
operating personnel and leverage our existing asset and customer bases. We have committed resources and dedicated a management team with experience in these new business areas to focus exclusively on
these opportunities and on emerging digital distribution and other technologies. Business focus areas include in-theatre advertising, business meetings, and non-feature film
content distribution. We have invested in the equipment necessary to create our DCN, the largest digital in-theatre distribution and projection network in the world. While digital
projection technologies required to display motion pictures in our theatres are not yet commercially viable, lower-cost digital video and communications technology is available to expand
the revenue generating capabilities and opportunities. Through 2003, 4,711 screens within 394 theatres in 58 markets were deployed as part of this digital network of which 70 theatres and 612 screens
are represented by United Artists. In addition, our DCN is connected to 1,230 plasma screens (of which 195 plasma screens are represented by United Artists) that have been installed in the lobbies and
other high-traffic locations within these theatres to provide additional advertising reach and exposure. We intend to expand our DCN within REG to approximately 5,275 screens in 78 markets
in approximately 430 theatres during 2004. Our total investment in our DCN is expected to be approximately $72.9 million, of which we have invested approximately $65.7 million as of
January 1, 2004. We believe that this digital network is enabling us to more effectively capitalize on ancillary revenue opportunities.

In-Theatre Advertising.We believe that our theatres and DCN provide an attractive
platform for advertisers by allowing them to target a large and desirable customer base and improve the efficiency and reduce the cost of in-theatre advertising. We believe
on-screen and in-lobby advertising allows advertisers to achieve high impact appeal due to the captive nature of the movie audience and the sound and projection capabilities of
our theatres. We have developed proprietary software to distribute digital advertising content to specific screens or markets throughout REG's consolidated theatre circuit. The addition of digital
video and communications technologies has improved the quality of our on-screen advertising business and marketing and promotions business by replacing our slide projectors and 35mm
"rolling stock" advertising and making the delivery of advertising more time and cost efficient for advertisers and by allowing for more targeted marketing. Prior to the deployment of our DCN, our
in-theatre advertising programs consisted primarily of rolling stock (35mm) television commercials, lower quality intermission slides, intermission music, lobby monitor advertising and

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entertainment,
coupon distribution and customer sampling. With our DCN, the rolling stock commercials, intermission slides, and intermission music were replaced in February 2003 by a "digital
pre-show" that we have branded "The 2wentySM". "The 2wenty" includes, in addition to 30 and 60 second high quality advertisements, segments of original entertaining and
informative content provided by national media companies such as NBC, Turner Broadcasting, Universal Entertainment and Sony Pictures Entertainment (collectively, the "Content Partners"). In addition
to the long-term marketing and programming relationships created with the Content Partners, we have strong business relationships with many national advertisers, such as the
Coca-Cola Company and Masterfoods, with advertising agency groups, and with a leading Internet ticket provider, Fandango. Approximately 85% of the advertising revenues come from national
advertisers, with the remainder coming from regional and local advertisers. Our advertising business generally generates attractive margins because it is able to demand attractive pricing and utilizes
the DCN and our existing theatre assets and personnel.

Regal CineMeetings and EventsSM.Our Regal CineMeetings and
EventsSM business rents theatres on an individual or networked basis for seminars, corporate training, business meetings, church services, distance learning or business communication
uses, product and customer research and other entertainment uses such as concerts and movie premieres. By utilizing our DCN and telephone networks, we can provide an interactive video conferencing
network and two-way audio broadcasting and teleconferencing services. Theatre rentals allow us to utilize our assets more effectively during non-peak movie-going periods,
including Monday through Thursday and Friday, Saturday, and Sunday mornings.

Other Ancillary Business Opportunities.We believe that we will generate additional revenues in the
future as we continue to expand our ancillary business activities. These activities are currently focused on creating a new kind of national digital distribution network for the distribution of music,
education, sports, entertainment and other forms of digital content to paying customers as well as for educational and promotional purposes. As the new programming "Channels" are developed they will
be included as one of the product offerings of RCM. In addition, RCM will work closely with our theatre operations group to leverage new technologies to create a more interactive relationship with
patrons, to improve the marketing information we provide advertisers and thus improve the local marketing of motion
pictures and provide a better overall movie-going experience for our customers. As part of this effort, our frequent movie-goer program, the "Regal Crown ClubSM", was rolled
out in all of our markets during 2003.

Group Advance Ticket and Gift Certificate Sales.Regal CineMedia manages the sale of our advance
tickets sold to corporations and groups and the sale of gift certificates to individuals and groups. Cross-selling and bundling strategies across the advertising sales and other RCM sales groups and
across various of the RCM product offerings provides many sales and operational cost benefits.

FILM DISTRIBUTION

Domestic movie theatres are the primary initial distribution channel for domestic film releases. The theatrical success of a film is often the most important
factor in establishing its value in other film distribution channels. Motion pictures are generally made available through several alternative distribution methods after the theatrical release date,
including home video, cable television, broadcast television, international distribution and satellite and pay-per-view services. A strong opening run at the theatre can
establish a film's success and substantiate the film's revenue potential for both domestic and international distribution channels. For example, the value of home video and pay cable distribution
agreements frequently depends on the success of a film's theatrical release. Furthermore, studios' revenue-sharing percentage and ability to control the choice of distribution channels generally
declines as a film moves further from its theatrical release. As the primary distribution window for the public's evaluation of films, domestic theatrical distribution remains the cornerstone of a
film's overall financial success.

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The
development of additional distribution channels has given motion picture producers the ability to generate a greater portion of a film's revenues through channels other than
theatrical release. This increased revenue potential after a film's initial theatrical release has enabled major studios and some independent producers to increase the budgets for film production and
advertising. The total cost of producing a film averaged approximately $63.8 million in 2003, compared with approximately $29.9 million in 1993, while the average cost to advertise and
promote a film averaged approximately $39.0 million in 2003, compared with approximately $14.1 million in 1993.

FILM LICENSING

Evaluation of Film.We license films on a film-by-film and
theatre-by-theatre basis by negotiating directly with film distributors. Prior to negotiating for a film license, we evaluate the prospects for upcoming films. Criteria we
consider for each film include cast, director, plot, performance of similar films, estimated film rental costs and expected rating from the Motion Picture Association of America. Successful licensing
depends greatly upon the exhibitor's knowledge of trends and historical film preferences of the residents in markets served by each theatre, as well as the availability of commercially successful
motion pictures.

Access to Film Product.Films are licensed from film distributors owned by major film production
companies and from independent film distributors that generally distribute films for smaller production companies. Film distributors typically establish geographic film licensing zones and allocate
each available film to one theatre within that zone. Film licensing zones generally encompass a radius of three to five miles in metropolitan and suburban markets, depending primarily upon population
density.

In
film licensing zones where we are the sole exhibitor, we obtain film licenses by selecting a film from among those films being offered and negotiating directly with the distributor.
In zones where there is competition, a distributor will either allocate films among the exhibitors in the zone, or, on occasion, may require the exhibitors in the zone to bid for a film. When films
are licensed under the allocation process, a distributor will select an exhibitor who then negotiates film rental terms directly with the distributor. We currently do not bid for films in any of our
markets.

Film Rental FeesFilm licenses typically specify rental fees based on the higher of a gross receipts
formula or a theatre admissions revenues formula. Under a gross receipts formula, the distributor receives a specified percentage of box office receipts, with the percentage declining over the term of
the film's run. Under a theatre admissions revenues formula, the distributor receives a specified percentage of the excess of admissions revenues over a negotiated allowance for theatre expenses.
Although not specifically contemplated by the provisions of film licenses, rental fees actually paid by us are in some circumstances adjusted subsequent to exhibition in relation to the commercial
success of a film in a process known as "settlement."

Duration of Film Licenses.The duration of our film licenses are negotiated with our distributors on
a case-by-case basis. The terms of our license agreements depend on performance of each film. Marketable movies that are expected to have high box office admission revenues
will generally have longer license terms than movies with more uncertain performance and popularity.

Relationship with Distributors.Many distributors provide quality first-run movies to the
motion picture exhibition industry. While any one motion picture distributor can dominate any given weekend's business, no single distributor dominates the market for an annual period. We license
films from each of the major distributors and believe that our relationships with these distributors are good. From year to year, the revenues attributable to individual distributors will vary widely
depending upon the number and popularity of films that each one distributes.

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CONCESSIONS

In addition to box office admissions revenues, we generated approximately 25.6% of our total revenues from concessions sales during fiscal 2003. We emphasize
prominent and appealing concession stations designed for rapid and efficient service. We continually seek to increase concessions sales by optimizing product mix, introducing special promotions from
time to time and training employees to up-sell and cross-sell products. We have favorable concession supply contracts and have developed an efficient concession purchasing and
distribution supply chain. Our management negotiates directly with manufacturers for many of our concession items to obtain competitive prices and to ensure adequate supplies.

COMPETITION

The motion picture industry is highly competitive. Motion picture exhibitors generally compete on the basis of the following competitive factors:



Our
competitors vary substantially in size, from small independent exhibitors to large national chains. As a result, our theatres are subject to varying degrees of competition in the
regions in which they operate. Our competitors, including newly established motion picture exhibitors, may build new theatres or screens in areas in which we operate, which may result in increased
competition and excess capacity in those areas. If this occurs, it may have an adverse effect on our business and results of operations. As the largest motion picture exhibitor, however, we believe
that we will be able to generate economies of scale and operating efficiencies that will give us a competitive advantage over many of our competitors.

We
also compete with other motion picture distribution channels, including home video, cable television, broadcast television and satellite and pay-per-view
services. Other new technologies (such as video on demand) could also have an adverse effect on our business and results of operations. In addition, we compete for the public's leisure time and
disposable income with other forms of entertainment, including sporting events, concerts, live theatre and restaurants.

In
addition to the motion picture industry, we also operate in other industries as a result of our ancillary business activities. These industries currently include advertising services
and business communications services. Our advertising services compete with other forms of marketing media, including television, radio and billboards, as well as advertising in shopping centers,
airports, stadiums, supermarkets and public transportation, including taxis, trains and buses. While we believe that in-theatre advertising and promotions are becoming increasingly common
and very effective, advertisers may choose alternative methods of conveying their messages. If this occurs, it may have an adverse effect on our ancillary business activities and may affect our
results of operations.

Our
auditorium rental and business communications services compete with other forms of large-scale venues, including hotel conference centers, concert halls, other public meeting venues
and in-house communications equipment. We believe that our combination of size, geographic distribution and advanced technology offer customers a unique and effective venue for events such
as employee meetings and product demonstrations.

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MARKETING AND ADVERTISING

Currently, film distributors organize and finance multimedia advertising campaigns for major film releases. To market our theatres, we utilize advertisements,
including radio advertising, and movie schedules published in newspapers and over the Internet informing our patrons of film selections and show times. Newspaper advertisements are typically displayed
in a single grouping for all of our theatres located in a newspaper's circulation area. In some of our markets we employ special marketing programs for specific films and concessions items.

In
addition, we seek to develop patron loyalty through a number of marketing programs such as free summer children's film series and cross-promotional ticket redemptions and promotions
within local communities. We currently offer these programs only in selected markets. We plan to use these programs in markets where we believe patron loyalty can be further enhanced, and we will
continue to evaluate our markets on a case-by-case basis to determine the suitability of these programs in individual regions. In addition, we have a frequent moviegoer loyalty
program, named the Regal Crown Club, in all of our markets.

MANAGEMENT INFORMATION SYSTEMS

We make extensive use of information technology in all areas of our business. We provide many ways for our customers to purchase tickets, ranging from the point
of sale terminals in each theatre box office, to the self-service kiosks to Internet-based ticketing. We use our information technology systems to manage all aspects of our business. Our
point of sale systems enable us to monitor cash transactions and detect fraud and concessions inventory shrinkage, while capturing information about sales and attendance needed for film booking and
settlement. Our scheduling systems support the coordination needed to properly allocate our auditoriums between film showings and Regal CineMeetings events while also ensuring that each movie audience
views the intended set of advertisements and newspaper advertisements provide the correct show starting times. Our continuing investment in information technology has enabled our management team to
operate our theatres efficiently.

SEASONALITY

Our revenues are usually seasonal, coinciding with the timing of releases of motion pictures by the major distributors. Generally, studios release the most
marketable motion pictures during the summer
and the holiday season. The unexpected emergence of a hit film during other periods can alter the traditional trend. The timing of movie releases can have a significant effect on our results of
operations, and the results of one quarter are not necessarily indicative of results for the next quarter or any other quarter. The seasonality of motion picture exhibition, however, has become less
pronounced in recent years as studios have begun to release major motion pictures somewhat more evenly throughout the year.

EMPLOYEES

As of March 9, 2004, we employed approximately 22,941 persons. Some of our facilities employ union projectionists. The Company's expansion into new markets
may increase the number of employees represented by unions. The Company considers its employee relations to be good.

REGULATION

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. Consent
decrees effectively require major film distributors to offer and license films to exhibitors, including us, on a film-by-film and theatre-by-theatre
basis. Consequently, exhibitors cannot assure themselves of a supply of films by

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entering
into long-term arrangements with major distributors, but must negotiate for 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") to the extent that such properties are "public accommodations" and/or "commercial
facilities" as defined by 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, an award of damages to private litigants and additional capital expenditures to remedy such non-compliance. United Artists and
several of its subsidiaries and UATG are subject to a consent decree arising from a lawsuit captioned Connie Arnold et. al. v. United Artists Theatre Circuit, Inc. et. al. The plaintiffs
alleged nationwide violations with the ADA for failure to remove barriers to access at existing theatres in a timely manner.
In 1996, the parties involved in the case entered into a settlement agreement in which United Artists agreed to remove physical barriers to access at its theatres prior to July 2001. In
January 2001, the settlement agreement was amended to, among other things, extend the completion date for barrier removal to July 2006 and require minimum expenditures of $250,000 a year
for barrier removal.

On
August 13, 2003, the United States Court of Appeals for the Ninth Circuit reversed the United States District Court for the District of Oregon's award of summary judgment in
favor of our subsidiaries identified below with respect to an ADA claim on appeal before it, and remanded the case to the district court with instructions to enter summary judgment in favor of the
plaintiffs (other than Oregon Paralyzed Veterans of America, which did not join in the appeal). The lawsuit was originally filed in the district court on April 11, 2000 by the Oregon Paralyzed
Veterans of America, Kathy Stewmon, Tina Smith and Kathy Braddy against Regal Cinemas, Inc. and Eastgate Theatre Inc. dba Act III Theatre, Inc. The plaintiffs alleged, among other
things, that the "stadium seating" plans in six of the defendants' movie theatres violate the ADA and the related regulations of the Department of Justice. The appellate court did not address specific
changes, if any, that might be required to bring the stadium-style theatres into compliance with its interpretation of the ADA, and its decision conflicts with a recent decision, based upon
substantially similar facts, of the United States Court of Appeals for the Fifth Circuit captionedLara v. Cinemark USA, Inc. We believe we are in
compliance with the ADA regulation with respect to the subject theatres and as such have appealed the Ninth Circuit's decision to the Supreme Court of the United States. No decision has been made by
the Supreme Court of the United States on whether or not it will hear our appeal. For additional discussion regarding this and other litigation involving our operations, see Note 8 to the
accompanying consolidated financial statements.

We
believe that we are in substantial compliance with all current applicable regulations relating to accommodations for the disabled. We intend to comply with future regulations in this
regard, and except as set forth above, we do not currently anticipate that compliance will require us to expend substantial funds. Our theatre operations are also subject to federal, state and local
laws governing such matters as wages, working conditions, citizenship and health and sanitation requirements. We believe that we are in substantial compliance with all of such laws.

Item 2. PROPERTIES

As of January 1, 2004, we operated 357 of our theatres pursuant to lease agreements and owned the land and buildings for 73 theatres. For a
January 1, 2004 list of the states in which we operated theatres and the number of theatres and screens operated in each such state, see the chart under "BusinessTheatre
Operations" above, which is incorporated herein by reference. The majority of our leased theatres are subject to lease agreements with original terms of 20 years or more and, in most cases,
renewal options for up to an additional 10 years. These leases provide for minimum annual

---

rentals
and the renewal options generally provide for rent increases. Some leases require, under specified conditions, further rental payments based on a percentage of revenues above specified
amounts. A majority of the leases are net leases, which require us to pay the cost of insurance, taxes and a portion of the lessor's operating costs. Our theatre operating corporate office is located
in approximately 96,450 square feet of owned space in Knoxville, Tennessee. RCM's corporate office is located in approximately 47,500 square feet of space in Centennial, Colorado. We believe that
these facilities are adequate for our operations.

Item 3. LEGAL PROCEEDINGS

The information required to be furnished by us under this Part I, Item 3 (Legal Proceedings) is incorporated by reference to the information contained
under the captions "Bankruptcy Claims" and "Other" in Note 8 (Commitments and Contingencies) of our notes to consolidated financial statements included in Part II, Item 8 (Financial
Statements and Supplementary Data) of this report on Form 10-K.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of security holders during the fourth quarter ended January 1, 2004.

PART II

Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

There is no established public trading market for the Company's common stock. At March 31, 2004, there was one stockholder of record of our common stock.
The third amended and restated senior credit agreement limits the Company's ability to pay dividends. See Note 6 to the accompanying financial statements included in Item 8 of this Form
10-K.

Item 6. SELECTED FINANCIAL DATA

The selected historical consolidated financial data set forth below (except operating data) were derived from the consolidated financial statements of the
Company. The post-reorganization consolidated financial statements, which reflect the application of reorganization and purchase accounting have not been prepared on a consistent basis
with the pre-reorganization financial statements and are not comparable in all respects to the consolidated financial statements prior to the reorganization. Accordingly, for periods prior
to January 25, 2002, the assets and liabilities of Regal Cinemas and the related consolidated financial statements are referred to herein as "Predecessor Company," and for periods subsequent to
January 24, 2002, the assets and liabilities of Regal Cinemas and the related consolidated financial statements are referred to herein as "Reorganized Company." The "Company" and "Regal
Cinemas" refer to both Reorganized and Predecessor Company. The selected historical consolidated financial data (except operating data) as of and for the fifty-three weeks ended January 1,
2004, the forty-eight weeks ended December 26, 2002 and the four weeks ended January 24, 2002 were derived from the audited consolidated financial statements of Regal Cinemas and the
notes thereto. The selected historical consolidated financial data as of and for the fiscal years ended December 27, 2001, December 28, 2000 and December 30, 1999 were derived
from the audited consolidated financial statements of RCI and the notes thereto. Regal Cinemas was formed in January 2002 and therefore no historical financial data is available prior to that
date. The selected historical consolidated financial data set forth below should be read in conjunction with, and are qualified in their entirety by, "Management's Discussion and Analysis of Financial
Condition and

---

Results
of Operations" and Regal Cinemas' consolidated financial statements and notes thereto included elsewhere in this document.

|                                                                                  |  | Regal Cinemas Corporation (Reorganized Company) |         | Regal Cinemas Inc. (Predecessor Company) |  
|--------------------------------------------------------------------------------- |  | ----------------------------------------------- | ------- | ---------------------------------------- | -
|
|Statement of Operations Data (in millions):                                       |  |                                                 |         |                                          |  
|Revenues:                                                                         |  |                                                 |         |                                          |  
|Admissions                                                                        |  | $                                               | 1,454.0 |                                          | $
|Concessions                                                                       |  |                                                 | 553.1   |                                          |  
|Other                                                                             |  |                                                 | 151.0   |                                          |  
|                                                                                  |  |                                                 |         |                                          |  
|Total revenues                                                                    |  |                                                 | 2,158.1 |                                          |  
|Operating Expenses:                                                               |  |                                                 |         |                                          |  
|Film rental and advertising cost                                                  |  |                                                 | 784.9   |                                          |  
|Cost of concessions                                                               |  |                                                 | 79.5    |                                          |  
|Contractual rent                                                                  |  |                                                 | 213.7   |                                          |  
|Straight-line adjustment                                                          |  |                                                 | 13.9    |                                          |  
|Other operating expenses                                                          |  |                                                 | 507.8   |                                          |  
|General and administrative expenses                                               |  |                                                 | 58.1    |                                          |  
|Merger and restructuring expenses and amortization of deferred stock compensation |  |                                                 | 4.8     |                                          |  
|Depreciation and amortization                                                     |  |                                                 | 141.8   |                                          |  
|Theatre closing cost and (gain) loss on disposal of operating assets              |  |                                                 | (3.5    | )                                        |  
|Loss on impairment of assets                                                      |  |                                                 | 1.5     |                                          |  
|                                                                                  |  |                                                 |         |                                          |  
|Total operating expenses                                                          |  |                                                 | 1,802.5 |                                          |  
|                                                                                  |  |                                                 |         |                                          |  
|Income (loss) from operations                                                     |  | $                                               | 355.6   |                                          | $
|                                                                                  |  |                                                 |         |                                          |  
|Net income (loss)                                                                 |  | $                                               | 175.2   |                                          | $
|                                                                                  |  |                                                 |         |                                          |  
|Operating Data:                                                                   |  |                                                 |         |                                          |  
|Theatres at period end                                                            |  |                                                 | 430     |                                          |  
|Screens at period end                                                             |  |                                                 | 5,110   |                                          |  
|Average screens per theatre                                                       |  |                                                 | 11.9    |                                          |  
|Attendance (in millions)                                                          |  |                                                 | 228.4   |                                          |  
|Average ticket price                                                              |  | $                                               | 6.37    |                                          | $
|Average concessions per patron                                                    |  |                                                 | 2.42    |                                          |  
|Balance Sheet Data (in millions):                                                 |  |                                                 |         |                                          |  
|Cash and cash equivalents                                                         |  | $                                               | 266.3   |                                          | $
|Total assets                                                                      |  |                                                 | 2,257.3 |                                          |  
|Total long term obligations                                                       |  |                                                 | 981.3   |                                          |  
|Shareholders' equity (deficit)                                                    |  |                                                 | 858.9   |                                          |  

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Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview and Basis of Presentation

We conduct our operations primarily through our subsidiaries: RCI; Edwards; RCM; Hoyts; and UATG. We operate the largest and most geographically diverse theatre
circuit in the United States, consisting of 5,110 screens in 430 theatres in 37 states as of January 1, 2004, with over 225 million annual attendees for the fifty-three weeks ended
January 1, 2004. In addition, we operate 935 screens in 120 theatres for United Artists pursuant to a management agreement. RCM focuses exclusively on the expansion of ancillary businesses,
such as advertising, and the creation of new complementary business lines that leverage the Company's existing asset and customer bases. The Company believes

---

the
size, reach and quality of its theatre circuit provide an exceptional platform to realize economies of scale in its theatre operations and capitalize on RCM's ancillary revenue opportunities.

We
generate revenues primarily from admissions and concession sales. Additional revenues are generated by on-screen advertisements and rental of theatres for business
meetings and other events by Regal CineMedia, vendor marketing programs and electronic video games located adjacent to the lobbies of certain of our theatres. Film rental costs depend on the
popularity of a film and the length of time since the film's release and generally decline as a percentage of admission revenues the longer a film is in exhibition. Because we purchase certain
concession items, such as fountain drinks and popcorn, in bulk and not pre-packaged for individual servings, we are able to improve our margins by negotiating volume discounts. Other
operating expenses consist primarily of theatre labor and occupancy costs.

We
acquired RCI on January 29, 2002, the date it emerged from bankruptcy, by exchanging 7,500,000 shares of our common stock for all of the outstanding shares of common stock of
RCI. We were formed for the primary purpose of providing financing to RCI upon RCI's emergence from bankruptcy through borrowings under senior credit facilities and by issuing $200 million of
senior subordinated notes.

We
became a wholly owned subsidiary of REG on April 12, 2002 in conjunction with an exchange transaction in which REG, through its wholly owned subsidiary REH, also acquired
Edwards and RCM. REG is controlled by Anschutz, which controlled each of us, Edwards and RCM prior to REG's acquisition of us and them in the exchange transaction. Following the exchange transaction,
RCI acquired Edwards, RCM, Hoyts and UATG from REH or REG in a series of transactions discussed in Note 4"Acquisitions" to the accompanying consolidated financial statements.
Unless otherwise noted, the "Company" or "Regal Cinemas" refers to Regal Cinemas Corporation and its subsidiaries on a consolidated basis, which includes RCI, Edwards and the assets of UATG as of
January 24, 2002 and RCM as of February 21, 2002, the deemed dates at which Anschutz initially held
common control in RCI, Edwards, RCM and the assets of UATG, and includes Hoyts as of March 28, 2003, the date at which REG initially held common control in both RCI and Hoyts.

The
Company's combined 2002 statements of operations include information reflecting the four-week period ended January 24, 2002 (Predecessor Company) and the
forty-eight week period ended December 26, 2002 (Reorganized Company). As a result, the Company's post-reorganization statements of operations have not been prepared on a consistent
basis with the pre-reorganization consolidated financial statements and are not comparable in all respects to the consolidated financial statements prior to the reorganization and RCI's
acquisition of Edwards. For financial reporting purposes, the inception date of the Reorganized Company is deemed to be January 24, 2002. As such, operating results and financial position for
periods subsequent to January 24, 2002 are herein referred to as the "Reorganized Company" and for all periods ending on or prior to January 24, 2002 as the "Predecessor Company."

In
order to provide a meaningful basis of comparing the years ended January 1, 2004, December 26, 2002 and December 27, 2001 for purposes of the following tables and
discussion under "Results of Operations" below, the operating results of the Reorganized Company for the forty-eight weeks ended December 26, 2002, which includes the results of operations of
Edwards and UATG for the period from January 24, 2002 to December 26, 2002 and RCM for the period from February 21, 2002 to December 26, 2002, have been combined with the
operating results of the Predecessor Company for the four weeks ended January 24, 2002 (collectively, the "Combined Company") ("Fiscal 2002 Period") and are compared to the fifty-three weeks
ended January 1, 2004 ("Fiscal 2003 Period") and the year ended December 27, 2001 ("Fiscal 2001 Period"). Depreciation, amortization and certain other line items included in the
operating results of the Combined Company are not comparable between periods as the four weeks ended January 24, 2002 of the Predecessor Company do not include

---

the
effects of fresh-start and purchase accounting adjustments. The combining of reorganized and predecessor periods is not in accordance with accounting principles generally accepted in the United
States of America.

For
a summary of industry trends as well as other risks and uncertainties relevant to the Company, see "Business- Industry Trends" above and "Results of Operations" below.

Results of Operations

The theatre exhibition industry fared better than expected against record 2002 box office results. Based on our results and our review of selected industry
sources, we believe national box office revenues in calendar year 2003 approximated that of calendar year 2002. Management believes that 2003 box office
results benefited from increased average ticket prices per patron, offset by a decline in national attendance. The increase in average ticket price per patron resulted from increases in ticket prices
coupled with a favorable film product mix, which resulted in sales of a greater proportion of full-price tickets. Although the film mix favorably impacted average ticket prices per patron,
it had a negative impact on concession revenue per patron. The fiscal 2003 film mix consisted of a higher proportion of R-rated and PG-13 rated films.

Better
than expected box office performance (consistent with industry trends), the acquisition of Hoyts, increases in RCM advertising and business meetings and events revenues, the
impact of week fifty-three and the other factors described below led to the increases in the Company's total revenues, income from operations and net income. The additional week in fiscal 2003 is
significant in that it was the week between Christmas and New Years Day, which is a traditionally high attendance week for the Company and the industry and accounted for approximately 3.9% of the
Fiscal 2003 Period total attendance. Total revenues for the Fiscal 2003 Period were $2,158.1 million, a 16.6% increase compared to total revenues of $1,850.9 million for Fiscal 2002
Period. Income from operations for the Fiscal 2003 Period was $355.6 million, a 23.6% increase compared to income from operations of $287.7 million for Fiscal 2002 Period.    
Net income decreased 68.0% to $175.2 million for fiscal 2003 compared to net income of $547.0 million in fiscal 2002. The Fiscal 2002 Period included a $661.9 million gain on
extinguishment of debt related to the RCI restructuring. Excluding the effects of week fifty-three and the results of Hoyts, Fiscal 2003 Period total revenues, income from operations and net income
would have increased (decreased) over the Fiscal 2002 Period by 3.8%, 3.3% and (74.2%), respectively.

During
the Fiscal 2003 Period, the Company made significant progress with its strategic initiatives:



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We
remain optimistic regarding the 2004 film slate and share the view of a number of film studio executives who believe the industry is poised to benefit from another year of solid box
office performance. Evidenced by the film studios' continued efforts to promote and market upcoming film releases, 2004 appears to be another year of an extended film release calendar consisting of
high-profile releases such asThe Passion of the Christas well as a few key sequels, such asHarry Potter and the
Prisoner of Azkaban, Shrek 2 and Spiderman 2. As a result of the breadth of the anticipated 2004 film product, the Company anticipates a slight increase in industry attendance
for the 2004 calendar year as compared to the 2003 calendar year coupled with modest increases in ticket prices and concession revenues per patron.

We
intend to grow our theatre circuit through selective expansion and through acquisition opportunities. With respect to capital expenditures, due in part to the timing of certain
construction projects, we expect theatre capital expenditures to be in the range of $115 million to $120 million for fiscal 2004, consisting of new theatre development, expansion of
existing theatre facilities, upgrades and maintenance. In addition, we are forecasting approximately $15 to $20 million of RCM capital expenditures.

We
will continue to focus on a simple business strategy including continued evaluation of acquisition opportunities to selectively consolidate a fragmented industry, enhancement of
attractive business opportunities through RCM and continued pursuit of a growth strategy that will provide incremental
returns on our assets. For an understanding of the significant factors that influenced our performance during the past three fiscal years, the preceding and following discussion should be read in
conjunction with the consolidated financial statements and the notes thereto presented in this Form 10-K.

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The following table sets forth the percentage of total revenues represented by certain items included in our consolidated statements of operations and other statistical data for the
Fiscal 2003 Period, Fiscal 2002 Period and Fiscal 2001 Period (dollars and attendance in millions, except average ticket prices and average concession per patron):

|                    |                                                                                             | (Reorganized Company)
Fiscal 2003 Period(6) |         | (Combined Company)
Fiscal 2002 Period |         | (Predecessor Company)
Fiscal 2001 Period |      | Percentage
Increase (decrease)
in Dollar Amounts |        
|------------------- | ------------------------------------------------------------------------------------------- | ------------------------------------------- | ------- | ------------------------------------- | ------- | ---------------------------------------- | ---- | ------------------------------------------------ | -------
|
|Revenues:           |                                                                                             |                                             |         |                                       |         |                                          |      |                                                  |        
|                    | Admissions                                                                                  |                                             | $       | 1,454.0                               |         | 67.4                                     | %    | $                                                | 1,252.9
|                    | Concessions                                                                                 |                                             |         | 553.1                                 |         | 25.6                                     |      |                                                  | 504.1  
|                    | Other operating revenues                                                                    |                                             |         | 151.0                                 |         | 7.0                                      |      |                                                  | 93.9   
|                    |                                                                                             |                                             |         |                                       |         |                                          |      |                                                  |        
|Total Revenues      |                                                                                             |                                             | 2,158.1 |                                       | 100.0   |                                          |      | 1,850.9                                          |        
|Operating Expenses: |                                                                                             |                                             |         |                                       |         |                                          |      |                                                  |        
|                    | Film rental and advertising costs(1)                                                        |                                             |         | 784.9                                 |         | 54.0                                     |      |                                                  | 679.6  
|                    | Cost of concessions(2)                                                                      |                                             |         | 79.5                                  |         | 14.4                                     |      |                                                  | 72.3   
|                    | Contractual rent(3)                                                                         |                                             |         | 213.7                                 |         | 9.9                                      |      |                                                  | 182.3  
|                    | Straight-line rent adjustment(3)                                                            |                                             |         | 13.9                                  |         | 0.6                                      |      |                                                  | 13.8   
|                    | Other operating expense(3)                                                                  |                                             |         | 507.8                                 |         | 23.5                                     |      |                                                  | 419.7  
|                    | General and administrative expense(3)                                                       |                                             |         | 58.1                                  |         | 2.7                                      |      |                                                  | 59.6   
|                    | Depreciation and amortization(3)                                                            |                                             |         | 141.8                                 |         | 6.6                                      |      |                                                  | 119.0  
|                    | Merger and restructuring expenses and amortization of deferred stock compensation(3)        |                                             |         | 4.8                                   |         | 0.2                                      |      |                                                  | 13.7   
|                    | Theatre closing costs and net loss (gain) on disposal and impairment of operating assets(3) |                                             |         | (2.0                                  | )       | (0.1                                     | )    |                                                  | 3.2    
|                    |                                                                                             |                                             |         |                                       |         |                                          |      |                                                  |        
|                    |                                                                                             | Total operating expenses(3)                 |         |                                       | 1,802.5 |                                          | 83.5 |                                                  |        
|                    |                                                                                             |                                             |         |                                       |         |                                          |      |                                                  |        
|                    | Income (loss) from operations(3)                                                            |                                             |         | 355.6                                 |         | 16.5                                     |      |                                                  | 287.7  
|                    | Interest expense(3)                                                                         |                                             |         | 67.4                                  |         | 3.1                                      |      |                                                  | 63.6   
|                    | Provision for income taxes(3)                                                               |                                             |         | 114.5                                 |         | 5.3                                      |      |                                                  | 84.8   
|                    | Net income (loss)(3)                                                                        |                                             |         | 175.2                                 |         | 8.1                                      |      |                                                  | 547.0  
|                    | Attendance                                                                                  |                                             |         | 228.4                                 |         |                                          |      |                                                  | 208.5  
|                    | Average ticket price(4)                                                                     |                                             | $       | 6.37                                  |         |                                          |      | $                                                | 6.01   
|                    | Average concession per patron(5)                                                            |                                             | $       | 2.42                                  |         |                                          |      | $                                                | 2.42   

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Fiscal 2003 Period Compared to Fiscal 2002 Period Compared to Fiscal 2001 Period



Total admissions revenues increased $201.1 million, or 16.1%, to $1,454.0 million for the Fiscal 2003 Period, from $1,252.9 million for the
Fiscal 2002 Period. The increase in admissions revenues in the Fiscal 2003 Period compared to the Fiscal 2002 Period was primarily attributable to a 9.5% increase in attendance, which is principally
related to a full year of operations of Edwards and UATG during the Fiscal 2003 Period, the inclusion of Hoyts from March 28, 2003 and the impact of the 53rd week of operations,
partially offset by the net closure of 26 screens during the Fiscal 2003 Period. These box
office results were favorably impacted by a 6.0% increase in average ticket prices, which reflected actual price increases and the impact of a favorable film product mix.

Total
admissions revenues increased $453.1 million, or 56.7%, to $1,252.9 million for the Fiscal 2002 Period, from $799.8 million for the Fiscal 2001 Period. The
increase in admissions revenues in the Fiscal 2002 Period compared to the Fiscal 2001 Period was primarily attributable to a 6.9% increase in ticket prices coupled with a 46.5% increase in attendance,
which is principally related to the inclusion of Edwards and UATG from January 24, 2002.



Total concessions revenues increased $49.0 million, or 9.7%, to $553.1 million for the Fiscal 2003 Period, from $504.1 million for the Fiscal
2002 Period. The increase in concessions revenues in the Fiscal 2003 Period compared to the Fiscal 2002 Period was due to a 9.5% increase in attendance. Despite modest concession price increases,
concession revenue per patron for the Fiscal 2003 Period remained the same as that of the Fiscal 2002 Period. This was primarily attributable to film product mix, which was comprised of a higher
proportion of R-rated and PG-13 rated films. These films typically result in lower concession revenue per patron.

Total
concessions revenues increased $182.8 million, or 56.9%, to $504.1 million for the Fiscal 2002 Period from $321.3 million for the Fiscal 2001 Period. The
increase in concessions revenues for the Fiscal 2002 Period compared to the Fiscal 2001 Period was due to a 7.1% increase in average concession per patron, coupled with a 46.5% increase in attendance,
which is principally related to the inclusion of Edwards and UATG from January 24, 2002. Additionally, the mix of film product during the Fiscal 2002 Period consisted of a higher percentage of
family films, which typically generate higher concessions per patron.



Total other operating revenues increased $57.1 million, or 60.8%, to $151.0 million for the Fiscal 2003 Period, from $93.9 million for the
Fiscal 2002 Period. Included in other operating revenues are on-screen advertising revenues, meetings and events, marketing revenues from our vendor marketing programs, game revenues and
our management fees from United Artists. The increase in other operating revenues was primarily attributable to increases in advertising and meetings revenues generated by Regal CineMedia, the
inclusion of Hoyts from March 28, 2003 and, to a lesser extent, increases in our revenues from vendor marketing programs during the Fiscal 2003 Period.

Total
other operating revenues increased $49.4 million to $93.9 million for the Fiscal 2002 Period from $44.5 million for the Fiscal 2001 Period. The increase in
other operating revenues in the Fiscal 2002 Period compared to the Fiscal 2001 Period is primarily attributable to the inclusion of Edwards

---

and
UATG from January 24, 2002 and RCM from February 21, 2002 and management fee income from United Artists.



Film rental and advertising costs increased $105.3 million, or 15.5%, to $784.9 million in the Fiscal 2003 Period, from $679.6 million in the
Fiscal 2002 Period. Film rental and advertising costs as a percentage of admissions revenues decreased slightly to 54.0% in the Fiscal 2003 Period as compared to 54.2% in the Fiscal 2002 Period as a
result of a decline in advertising expense and a lower percentage of box office revenues being derived from higher grossing films. The increase in film rental and advertising costs during the Fiscal
2003 Period was primarily attributable to a full year of operations of Edwards and UATG during the Fiscal 2003 Period, the inclusion of Hoyts from March 28, 2003 and the impact of the
53rd week of operations during the Fiscal 2003 Period.

Film
rental and advertising costs increased $247.2 million, or 57.2%, to $679.6 million in the Fiscal 2002 Period from $432.4 million in the Fiscal 2001 Period. Film
rental and advertising costs as a percentage of admissions revenues increased slightly to 54.2% in the Fiscal 2002 Period from 54.1% in the Fiscal 2001 Period. The increase in film rental and
advertising costs in the Fiscal 2002 Period was primarily attributable to the inclusion of Edwards and UATG from January 24, 2002, coupled with higher box office revenues, which translated into
higher film rental costs.



Cost of concessions increased $7.2 million, or 10.0%, to $79.5 million in the Fiscal 2003 Period, from $72.3 million in the Fiscal 2002
Period. Cost of concessions as a percentage of concessions revenues increased to 14.4% in the Fiscal 2003 Period as compared to 14.3% in the Fiscal 2002 Period. The increase in the cost of concessions
Fiscal 2003 Period was primarily attributable to product mix, partially offset by the realization of operating efficiencies realized through the 2002 integration of Regal Cinemas and Edwards.

Cost
of concessions increased $25.1 million, or 53.2%, to $72.3 million in the Fiscal 2002 Period from $47.2 million in the Fiscal 2001 Period. The decrease in the
cost of concessions as a percentage of concessions revenues in the Fiscal 2002 Period compared to the Fiscal 2001 Period is primarily attributable to the realization of operating efficiencies realized
through the integration of Edwards and RCI in the Fiscal 2002 Period.



Rent expense increased $31.4 million, or 17.2%, to $213.7 million in the Fiscal 2003 Period from $182.3 million in the Fiscal 2002 Period.
Rent expense as a percentage of total revenues was 9.9% and 9.8% for the Fiscal 2003 and Fiscal 2002 Periods, respectively. The increase in rent expense in the Fiscal 2003 Period was primarily
attributable to a full year of operations of Edwards and UATG during the Fiscal 2003 Period and the inclusion of Hoyts from March 28, 2003, coupled with marginal increases in rent at expanded
locations.

Rent
expense increased $55.9 million, or 44.2%, to $182.3 million in the Fiscal 2002 Period from $126.4 million in the Fiscal 2001 Period. Rent expense as a
percentage of total revenues was 9.8% and 10.8% for the Fiscal 2002 and Fiscal 2001 Periods, respectively. The increase in rent expense in the Fiscal 2002 Period was primarily attributable to the
inclusion of Edwards and UATG from January 24, 2002. The decrease in rent expense as a percentage of total revenues in the Fiscal 2002 Period was primarily attributable to declines in rent
associated with the closure of certain under-performing theatres in the Fiscal 2001 Period.

---



Other operating expenses increased $88.1 million, or 21.0%, to $507.8 million in the Fiscal 2003 Period, from $419.7 million in the Fiscal
2002 Period. Other operating expenses as a percentage of total revenues rose to 23.5% in the Fiscal 2003 Period as compared to 22.7% in the Fiscal 2002 Period. The increase in total other operating
expenses in the Fiscal 2003 Period was primarily attributable to incremental costs associated with the inclusion of Hoyts from March 28, 2003, the impact of the 53rd week of operations and a
full year of operations of Edwards, UATG and Regal CineMedia during the Fiscal 2003 Period coupled with incremental expenses associated with Regal CineMedia, which began substantive operations in the
second fiscal quarter of 2002. Such increases are partially offset by operating efficiencies realized through the 2002 integration of Regal Cinemas and Edwards.

Other
operating expenses increased $117.7 million, or 39.0%, to $419.7 million in the Fiscal 2002 Period from $302.0 million in the Fiscal 2001 Period. Other
operating expenses as a percentage of total revenues decreased to 22.7% in the Fiscal 2002 Period from 25.9% in the Fiscal 2001 Period. The decrease in other operating expenses as a percentage of
total revenues in the Fiscal 2002 Period was primarily attributable to declines in occupancy costs associated with the closure of certain under-performing theatres in 2001 coupled with operating
efficiencies realized through the integration of Edwards and RCI in the Fiscal 2002 Period.



General and administrative expenses decreased $1.5 million, or 2.5%, to $58.1 million during the Fiscal 2003 Period, from $59.6 million in
the Fiscal 2002 Period. As a percentage of total revenues, general and administrative expenses were approximately 2.7% and 3.2% in the Fiscal 2003 and Fiscal 2002 Periods, respectively. The decrease
in general and administrative expenses as a percentage of total revenues during the Fiscal 2003 Period was primarily attributable to operating efficiencies realized through the 2002 integration of
Regal Cinemas and Edwards, coupled with an increase in total revenues.

General
and administrative expenses increased $28.0 million or 88.6%, to $59.6 million in the Fiscal 2002 Period from $31.6 million in the Fiscal 2001 Period. As a
percentage of total revenues, general and administrative expenses increased to 3.2% in the Fiscal 2002 Period from 2.7% in the Fiscal 2001 Period. The increase during the Fiscal 2002 Period in general
and administrative expense was primarily attributable to higher staffing levels maintained during the Fiscal 2002 Period and other costs associated with the integration of RCI, Edwards and RCM.



Depreciation and amortization increased $22.8 million, or 19.2%, to $141.8 million in the Fiscal 2003 Period, from $119.0 million in the
Fiscal 2002 Period. The increase in depreciation and amortization during the Fiscal 2003 Period is primarily due to a full year of operations of Edwards, UATG and Regal CineMedia during the Fiscal
2003 Period and the inclusion of Hoyts from March 28, 2003.

Depreciation
and amortization increased $28.0 million, or 30.8%, to $119.0 million in the Fiscal 2002 Period from $91.0 million in the Fiscal 2001 Period. The
increase during the Fiscal 2002 Period in depreciation and amortization is due to the inclusion of Edwards, UATG and RCM, offset by the closure of certain under-performing theatres and write down of
property and equipment associated with RCI's reorganization, and the adoption of SFAS No. 142, "Goodwill and Other Intangible Assets," which resulted in the Company no longer amortizing
goodwill.

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Merger and restructuring expenses and amortization of deferred stock compensation decreased $8.9 million, or 65.0%, to $4.8 million in the Fiscal
2003 Period from $13.7 million in the Fiscal 2002 Period. The decrease in merger and restructuring expenses in the Fiscal 2003 Period as compared to the Fiscal 2002 Period is due primarily to
higher legal and professional fees incurred during the Fiscal 2002 Period associated with Regal Cinemas Inc.'s Chapter 11 bankruptcy reorganization. RCI emerged from bankruptcy on
January 29, 2002.

Merger
and restructuring expenses and amortization of deferred stock compensation decreased $7.1 million, or 34.1%, to $13.7 million in the Fiscal 2002 Period from
$20.8 million in the Fiscal 2001 Period. The increase in merger and restructuring expenses in the Fiscal 2001 Period as compared to the Fiscal 2002 Period is due primarily to legal and
professional fees associated with Regal Cinemas Inc.'s Chapter 11 bankruptcy reorganization.



Theatre closing costs and loss (gain) on disposal and impairment of operating assets decreased $5.2 million to ($2.0) million in the Fiscal 2003 Period
from $3.2 million in the Fiscal 2002 Period. Theatre closing costs and loss (gain) on disposal of operating assets decreased $108.8 million to $3.2 million in the Fiscal 2002
Period from $112.0 million in the Fiscal 2001 Period. The increase in theatre closing costs and loss on disposal of operating assets during the Fiscal 2001 Period as compared to the Fiscal 2002
Period is due to expenses associated with the closure of under-performing theatres.



Income from operations totaled approximately $355.6 million for the Fiscal 2003 Period, which represents an increase of $67.9 million, or 23.6%,
from $287.7 million in the Fiscal 2002 Period. The increase in operating income during the Fiscal 2003 Period is primarily attributable to the growth in total revenues related to the inclusion
of Edwards, UATG and RCM for a full year during the Fiscal 2003 Period, the inclusion of Hoyts from March 28, 2003 and the impact of the 53rd week of operations during the Fiscal 2003 Period,
coupled with the realized benefits of the 2002 integration of Edwards and Regal Cinemas. The increase in operating income during the Fiscal 2003 Period was also attributable to a reduction of merger
and restructuring expenses, partially offset by increases in certain other operating expense items described in previous sections.

Income
from operations increased $295.3 million to $287.7 million in the Fiscal 2002 Period from a loss from operations of $7.6 million in the Fiscal 2001 Period.
Income (loss) from operations as a percentage of total revenues increased to 15.5% during the Fiscal 2002 Period as compared to (0.7%) in the Fiscal 2001 Period.



Interest expense increased $3.8 million, or 6.0%, to $67.4 million in the Fiscal 2003 Period, from $63.6 million in the Fiscal 2002 Period.
The increase in interest expense in the Fiscal 2003 Period is attributable to additional borrowings under the amended and restated Regal Cinemas senior credit facility related to the purchase of UATG
during the second fiscal quarter of 2003.

Interest
expense decreased $110.6 million, or 63.5%, to $63.6 million in the Fiscal 2002 Period from $174.2 million in the Fiscal 2001 Period. The decrease in
interest expense in the Fiscal 2002 Period is due to RCI's debt restructuring associated with its Chapter 11 bankruptcy filing, coupled with lower average outstanding interest rates on our new
outstanding debt.

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The provision for income taxes of $114.5 million for the Fiscal 2003 Period reflects an effective tax rate of approximately 39.5%. The provision for income
taxes of $84.8 million for the forty-eight weeks ended December 26, 2002 reflects an effective tax rate of approximately 40.2%. No benefit for income taxes was recorded for the four
weeks ended January 24, 2002 or for the Fiscal 2001 Period because we recorded an offsetting valuation allowance against the resulting deferred tax assets, as it was more likely than not that
such deferred tax assets would not be realized. Accordingly, the effective tax rate for the four weeks ended January 24, 2002 and the Fiscal 2001 Period was 0%.



Net income totaled $175.2 million for the Fiscal 2003 Period, which represents a decrease of $371.8 million from net income of $547.0 million
in the Fiscal 2002 Period. The Fiscal 2002 Period included a $661.9 million gain on extinguishment of debt related to the RCI restructuring. Net income increased $718.5 million to
$547.0 million in the Fiscal 2002 Period from a net loss of $171.5 million for the Fiscal 2001 Period.



The following table summarizes certain cash flow data for the Fiscal 2003, 2002 and 2001 Periods:

|                                                     |  | Fiscal 2003 Period |        | Fiscal 2002 Period |   | Fiscal 2001 Period |  
|---------------------------------------------------- |  | ------------------ | ------ | ------------------ | - | ------------------ | -
|
|Net cash provided by operating activities            |  | $                  | 462.3  |                    | $ | 306.0              |  
|Net cash used in investing activities                |  |                    | (588.5 | )                  |   | (91.1              | )
|Net cash provided by (used in) financing activities  |  |                    | 213.8  |                    |   | (252.6             | )
|Cash used in reorganization                          |  |                    |       |                    |   | (21.3              | )
|                                                     |  |                    |        |                    |   |                    |  
|Net increase (decrease) in cash and cash equivalents |  | $                  | 87.6   |                    | $ | (59.0              | )



Net cash provided by operating activities was approximately $462.3 million for the Fiscal 2003 Period compared to approximately $306.0 million for
the Fiscal 2002 Period. The net increase was attributable to an increase in net income of $49.0 million, which is attributable to a full year of operations of Edwards, UATG and RCM in 2003, the
inclusion of Hoyts from March 28, 2003 and the impact of the 53rd week of operations during the Fiscal 2003 Period, coupled with certain increases in various components of current
liabilities, partially offset by a net decrease in non-cash items (primarily deferred income taxes). Cash flows used in investing activities increased by $497.4 million during the
Fiscal 2003 Period and is primarily attributable to the second quarter 2003 acquisitions of Hoyts and UATG, coupled with increased capital expenditures as a result of a full year of operations for
Edwards and RCM during the Fiscal 2003 Period and the inclusion of Hoyts from March 28, 2003. Cash flows provided by financing activities were approximately $213.8 million for the Fiscal
2003 Period compared to cash flows used in financing activities of approximately $252.6 million for the Fiscal 2002 Period. The increase in cash flows provided by financing activities was
primarily attributable to additional borrowings under the third amended and restated Regal Cinemas senior credit facility related to the purchase of UATG in the second quarter of the Fiscal 2003
Period and a reduction in the payment of RCI and Edwards bankruptcy claims during the Fiscal 2003 Period.

---



Net cash provided by operating activities was approximately $306.0 million for the Fiscal 2002 Period compared to approximately $152.0 million for
the Fiscal 2001 Period. The increase was attributable to an increase in net income due to the acquisitions of Edwards and RCM during 2002 and RCI's debt restructuring associated with its Chapter 11
bankruptcy filing, coupled with certain increases in non-cash (principally depreciation and amortization and deferred income taxes) and certain working capital items. Cash flows used in
investing activities increased by $67.9 million during the Fiscal 2002 Period and is primarily attributable to increased capital expenditures as a result of the acquisition of Edwards and the
initial deployment of our DCN during the Fiscal 2002 Period. Cash flows used in financing activities were approximately $252.6 million for the Fiscal 2002 Period compared to cash flows used in
financing activities of approximately $9.9 million for the Fiscal 2001 Period. The increase in cash flows used in financing activities was primarily related to cash used to redeem Edwards
preferred stock and other Edwards debt obligations during the second quarter of the Fiscal 2002 Period and the payment of bankruptcy claims and other obligations associated with RCI's and Edwards'
bankruptcy filings.

Liquidity and Capital Resources

We expect our primary uses of cash to be for operating expenses, general corporate purposes related to our corporate operations and debt service. Our principal
sources of liquidity are from our operating subsidiaries. Our operating subsidiaries' principal uses of cash will be for operating expenses, capital expenditures, and debt service. The principal
sources of liquidity for our subsidiaries are cash generated from operations, cash on hand and the revolving credit facilities provided for under the Regal Cinemas' third amended and restated credit
agreement.

Our
revenues are generally collected in cash through admissions and concessions revenues. Our operating expenses are primarily related to film and advertising costs, rent and occupancy,
and payroll. Film costs are ordinarily paid to distributors within 30 days following receipt of admissions revenues and the cost of the Company's concessions are generally paid to vendors
approximately 30 days from purchase. Our current liabilities generally include items that will become due within twelve months and, as a result, at any given time, our balance sheet is likely
to reflect a working capital deficit.

We
fund the cost of our operating subsidiaries' capital expenditures through internally generated cash flow, cash on hand and financing activities. Our capital requirements have
historically arisen principally in connection with acquisitions of theatres, new theatre openings, adding new screens to existing theatres, development of our DCN, upgrading the Company's theatre
facilities and replacing equipment. We intend to continue to grow our theatre circuit through selective expansion and acquisition opportunities. We currently expect capital expenditures for theatre
development, replacement, expansion, upgrading and maintenance to be in the range of $115 million to $120 million in
fiscal 2004. In addition to capital expenditures associated with our theatre operations, we expect to incur capital expenditures of approximately $15 million to $20 million in connection
with RCM during fiscal 2004. RCM capital expenditures will be made in connection with the deployment of our DCN to provide advertising and promotional services and digital distribution content
capabilities to additional markets coupled with expenditures for other in-lobby advertising and promotional initiatives. During the Fiscal 2003 Period, we invested an aggregate of
approximately $136.5 million in capital expenditures.

On
March 28, 2003, RCI acquired all of the outstanding capital stock of Hoyts from REG for a purchase price of approximately $213.1 million. The purchase price includes
cash of approximately $188.1 million, and the assumption of certain capital lease and other obligations with a fair value of approximately $25.0 million. The acquired Hoyts theatre
assets is comprised of a total of 50 theatres and 534 screens located in 10 states in the Northeastern United States.

---

On
June 6, 2003, RCI acquired all of the outstanding capital stock of UATG from REH, consisting of 438 screens in 46 leased theatres, certain fee properties and certain other
assets under construction, for an estimated cash purchase price of approximately $311.4 million. The Company borrowed an additional $315.0 million under the Regal Cinemas senior credit
facility to fund the purchase price. See Note 6"Long-Term Obligations" to the accompanying consolidated financial statements for further description of Regal Cinemas'
third amended and restated credit agreement.

As
of January 1, 2004, Regal Cinemas had $145 million available under its undrawn amended and restated senior revolving credit facility, $509.6 million outstanding
under its senior secured term loan and $350 million principal amount of 93/8% senior subordinated notes due 2012. Regal Cinemas also maintains letters of credit of
$30 million as of January 1, 2004 (of which approximately $15.9 million was outstanding as of January 1, 2004) which reduces the availability under its senior revolving
credit facility.

Contractual Cash Obligations and Commitments

The Company primarily leases its theatres pursuant to long-term non-cancelable operating leases. As of January 1, 2004, the
Company's estimated contractual cash obligations and commercial commitments over the next several years are as follows (in millions):

|                             |                                          | Payments Due by Period            
|---------------------------- | ---------------------------------------- | ----------------------------------
|
|Contractual Cash Obligations |                                          |                                   
|                             | Long-term debt(1)                        |                                   
|                             | Lease financing arrangements(2)          |                                   
|                             | Bankruptcy claims and liabilities(3)     |                                   
|                             | Capital leases(2)                        |                                   
|                             | Other long-term and purchase obligations |                                   
|                             | Operating leases(4)                      |                                   
|                             |                                          |                                   
|                             |                                          | Total contractual cash obligations
|                             |                                          |                                   

|                             |                                 | Amount of Commitment Expiration per Period
|---------------------------- | ------------------------------- | ------------------------------------------
|
|Other Commercial Commitments |                                 |                                           
|                             | Total commercial commitments(5) |                                           

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The
Company believes that the amount of cash and cash equivalents on hand, cash flow expected from operations and availability under its revolving credit facilities will be adequate for
the Company to execute its business strategy and meet anticipated requirements for lease obligations, capital expenditures, working capital and debt service for at least 12 months.



The Company is rated by nationally recognized rating agencies. The significance of individual ratings varies from agency to agency. However, companies assigned
ratings at the top end of the range have, in the opinion of certain rating agencies, the strongest capacity for repayment of debt or payment of claims, while companies at the bottom end of the range
have the weakest capability. Ratings are always subject to change and there can be no assurance that the Company's current ratings will continue for any given period of time. A downgrade of the
Company's debt ratings, depending on the extent, could increase the cost to borrow funds. Below are our latest ratings per category, which were current as of January 1, 2004:

|Category                                      |  | Moody's |  | Standard
and Poor's
|--------------------------------------------- |  | ------- |  | -------------------
|Regal Cinemas Senior Credit Facility          |  | Ba2     |  | BB-                
|Regal Cinemas 93/8% Senior Subordinated Notes |  | B2      |  | B                  



The following is a description of the Company's material indebtedness as of January 1, 2004:



On August 27, 2003, Regal Cinemas entered into a new term loan facility ("New Term Loan D") under the third amended and restated credit agreement of Regal
Cinemas for approximately $523.1 million to refinance, at a more favorable interest rate, the aggregate outstanding principal amount under the former Term Loan C and Term Loan D facilities. The
amortization schedule under the New Term Loan D is equal to the sum of the scheduled quarterly amortization payments under the former Term Loan C and Term Loan D facilities. The New Term Loan D
facility amortizes at a rate of 5.2% per annum for each of the first three years of the loan, with the remaining 84.4% of principal becoming due in years four through six of the loan, maturing
June 30, 2009. The New Term Loan D facility is guaranteed by substantially all direct and indirect subsidiaries of Regal Cinemas and by substantially all real and personal property of Regal
Cinemas and its subsidiaries, as set forth in the third amended and restated credit agreement. The third amended and restated credit agreement carries identical covenants to those in the Regal Cinemas
credit agreement that was amended and restated. As of January 1, 2004, Regal Cinemas had $145 million available under its undrawn senior revolving credit facility. Regal Cinemas also
maintains letters of credit of $30 million (of which approximately

---

$15.9 million
was outstanding as of January 1, 2004), which reduces the availability under its senior revolving credit facility.

Borrowings
under the term facility bear interest, at Regal Cinemas' option, at either the base rate or Eurodollar rate plus, in each case, an applicable margin, subject to adjustment
based upon the consolidated total leverage ratio of Regal Cinemas. The base rate is a fluctuating interest rate equal to the higher of (a) the British Banking Association's prime rate or
(b) the Federal Funds Effective Rate plus 0.5%. At January 1, 2004, the interest rate on the amended and restated senior secured credit facility was approximately 3.7%.

Regal
Cinemas may prepay borrowings under the third amended and restated senior credit agreement in whole or in part, in minimum amounts and subject to other conditions set forth in the
third amended and restated senior credit agreement. Regal Cinemas is required to make mandatory prepayments to the lenders from:



The
mandatory prepayment of the obligations under the third amended and restated senior credit agreement is subject to specified exceptions. The lenders under the term credit facility
may elect to decline any mandatory prepayment.

Regal
Cinemas' obligations are secured by, among other things, the capital stock of most of its subsidiaries, mortgages on most of its properties and a security interest in substantially
all of its assets.

The
third amended and restated senior credit agreement includes several financial covenants. Regal Cinemas cannot permit, at the end of each applicable fiscal quarter:



The
third amended and restated senior credit agreement also contains customary covenants, including limitations on Regal Cinemas' ability to incur debt, and events of default, including
a change of control, as defined in the third amended and restated senior credit agreement. The third amended

---

and
restated senior credit agreement also limits Regal Cinemas' ability to pay dividends, to make advances and otherwise to engage in intercompany transactions. These limitations will restrict its
ability to fund operations outside of Regal Cinemas with funds generated at Regal Cinemas.



On January 29, 2002, Regal Cinemas issued $200.0 million aggregate principal amount of 93/8% senior subordinated notes due 2012.
Subsequently, on April 17, 2002, Regal Cinemas issued an additional $150.0 million aggregate principal amount of 93/8% senior subordinated notes due 2012 with identical
terms. The January notes were initially purchased by Credit Suisse First Boston Corporation and Lehman Brothers Inc., and the April notes were initially purchased by Credit Suisse First Boston
Corporation. In each instance, the notes were resold to various qualified institutional buyers and non-U.S. persons pursuant to Rule 144A and Rule 903 or Rule 904,
respectively, under the Securities Act of 1933. Interest on the notes is payable semi-annually on February 1 and August 1 of each year, and the notes mature on
February 1, 2012. The notes are guaranteed by most of Regal Cinemas' existing subsidiaries, and, under the circumstances specified in the indenture, future subsidiaries will also be required to
guarantee the notes. The notes are unsecured and rank behind Regal Cinemas' obligations under its senior credit facility and any future senior indebtedness.

Regal
Cinemas has the option to redeem the notes, in whole or in part, at any time on or after February 1, 2007 at redemption prices declining from 104.688% of their principal
amount on February 1, 2007 to 100% of their principal amount on or after February 1, 2010, plus accrued interest. At any time on or prior to February 1, 2005, Regal Cinemas may
also redeem up to 35% of the aggregate principal amount of the notes at a redemption price of 109.375% of their principal amount, plus accrued interest, within 90 days of an underwritten public
offering of common stock of Regal Cinemas or of a future underwritten public offering of the Company's common stock, the proceeds of which are used as a contribution to the equity of Regal Cinemas.
Upon a change of control, as defined in the indenture pursuant to which the notes were issued, Regal Cinemas is required to offer to purchase the notes at a purchase price equal to 101% of their
principal amount, plus accrued interest. In addition, the indenture limits Regal Cinemas' and its subsidiaries' ability to, among other things, incur additional indebtedness and pay dividends on or
repurchase capital stock.

In
May 2002, Regal Cinemas filed a registration statement (Registration No. 333-87930) under the Securities Act of 1933 pursuant to a registration rights
agreement entered into in connection with the 93/8% senior subordinated notes offerings. The registration statement was declared effective by the Securities and Exchange Commission on
July 10, 2002, enabling the eligible holders of the notes to exchange their notes for notes registered under the Securities Act of 1933. The transaction described in the registration statement,
pursuant to which all of the note holders exchanged their notes for registered notes, closed on August 14, 2002. Regal Cinemas did not receive any proceeds from the transaction.



During 2000, RCI entered into a sale and leaseback transaction with an unaffiliated third party involving 15 of its owned theatres. Under the terms of this
transaction, RCI sold the land and related improvements of the theatres for $45.2 million and leased them back for an initial lease term of 20 years, with an option to extend it for up
to 20 additional years. Regal Cinemas accounts for these leases as operating leases.



For some of the Company's new theatre sites built in fiscal years 1999, 2000 and 2001, the Company was considered the owner (for accounting purposes) of the
theatre during the construction

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period.
In accordance with Emerging Issues Task Force No. 97-10, "The Effect of Lessee Involvement in Asset Construction," the Company was required to record the balance sheet
obligations ($96.0 million at January 1, 2004) when the construction of the theatre was completed resulting in payments being recorded as interest expense and principal reduction rather
than rent expense. These leases typically run for a period of 20 years.



Regal Cinemas, Inc. and Edwards have bankruptcy claims that remain unsettled and are subject to ongoing negotiation and possible litigation. At
January 1, 2004, Regal Cinemas had accrued approximately $3.5 million for the estimated costs to resolve such bankruptcy claims. In the opinion of management, based on its examination of
these matters, its experience to date and discussions with legal counsel, the outcome of these legal matters, after taking into consideration the amounts already accrued, is not expected to have a
material effect on the Company's liquidity or results of operations. To the extent claims are allowed by the bankruptcy court, they will be funded with cash on hand, cash flow from operations or
borrowings under Regal Cinemas' revolving credit facility.

Critical Accounting Estimates

Our consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, which require
management to make estimates and assumptions that affect the reported amounts of the assets and liabilities and disclosures of contingent assets and liabilities as of the date of the balance sheet as
well as the reported amounts of revenues and expenses during the reporting period. We routinely make estimates and judgments about the carrying value of our assets and liabilities that are not readily
apparent from other sources. The Company evaluates and modifies on an ongoing basis such estimates and assumptions, which include, but are not limited to, those related to film costs, property and
equipment, goodwill, income taxes and reorganization and purchase accounting. Estimates and assumptions are based on historical and other factors believed to be reasonable under the circumstances. The
results of these estimates may form the basis of the carrying value of certain assets and liabilities. Actual results, under conditions and circumstances different from those assumed, may differ
materially from estimates. The impact and any associated risks related to estimates, assumptions, and accounting policies are discussed within "Management's Discussion and Analysis of Financial
Condition and Results of Operations," as well as in the Notes to the Consolidated Financial Statements, if applicable, where such estimates, assumptions, and accounting policies affect the Company's
reported and expected results.



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Quarterly Results

We became a wholly owned subsidiary of REG on April 12, 2002 in conjunction with an exchange transaction in which REG, through its wholly owned subsidiary
REH, also acquired Edwards and RCM. REG is controlled by Anschutz, which controlled each of us, Edwards and RCM prior to REG's acquisition of us and them in the exchange transaction. Following the
exchange transaction, RCI acquired Edwards, RCM, Hoyts and UATG from REH or REG in a series of transactions discussed in Note 4"Acquisitions" to the accompanying consolidated
financial statements. The Company's financial statements reflect the results of operations of Regal Cinemas and its subsidiaries on a consolidated basis, which includes RCI, Edwards and the assets of
UATG as of January 24, 2002 and RCM as of February 21, 2002, the deemed dates at which Anschutz initially held common control in RCI, Edwards, RCM and the assets of UATG. On
March 28, 2003, we acquired Hoyts. Accordingly, the results of operations of the acquired Hoyts theatre locations have been included in the accompanying consolidated financial statements for
the periods subsequent to the acquisition date of March 28, 2003.

The
following tables set forth selected unaudited quarterly results for the eight quarters ended January 1, 2004. The quarterly financial data as of each period presented below
have been derived from the Company's unaudited consolidated financial statements for those periods. Results for these periods are not necessarily indicative of results for the full year. The quarterly
financial data should be

---

read
in conjunction with the consolidated financial statements of Regal Cinemas and notes thereto included elsewhere in this Form 10-K.

|                 |  | Regal Corporation
(Reorganized Company) |       | Regal
Cinemas,
Inc.
(Predecessor
Company)
|---------------- |  | --------------------------------------- | ----- | -----------------------------------------
|
|
|Total revenues   |  | $                                       | 653.0 |                                          
|Operating income |  |                                         | 121.3 |                                          
|Net income       |  |                                         | 63.0  |                                          

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Inflation

The Company does not believe that inflation has had a material impact on its financial position or results of operations.

Seasonality

The Company's revenues are usually seasonal, coinciding with the timing of releases of motion pictures by the major distributors. Generally, studios release the
most marketable motion pictures during the summer and the holiday seasons. The unexpected emergence of a "hit" film during other periods can alter the traditional pattern. The timing of movie releases
can have a significant effect on the Company's results of operations, and the results of one quarter are not necessarily indicative of the results for the next or any other quarter. The seasonality of
motion picture exhibition, however, has become less pronounced in recent years as studios have begun to release major motion pictures somewhat more evenly throughout the year.

Recent Accounting Pronouncements

For a discussion of the recent accounting pronouncements relevant to our operations, please refer to the information provided under Note 2 to the
accompanying consolidated financial statements, which information is incorporated herein by reference.

Forward-looking Statements

Some of the information in this Form 10-K includes "forward-looking statements" within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this Form 10-K,
including, without limitation, certain statements under "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business" may constitute forward-looking
statements. In some cases you can identify these "forward-looking statements" by words like "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential"
or "continue" or the negative of those words and other comparable words. These forward-looking statements involve risks and uncertainties. Our actual results could differ materially from those
indicated in these statements as a result of certain risk factors as more fully discussed below and under the heading "Risk Factors" contained in our final prospectus dated and filed with the
Securities and

---

Exchange
Commission on July 10, 2002. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such
expectations will prove to be correct. The following analysis of our financial condition and results of operations should be read in conjunction with the Audited Consolidated Financial Statements and
Notes thereto included elsewhere in this Form 10-K.

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's market risk is confined to interest rate exposure of its and its wholly owned subsidiaries' debt obligations that bear interest based on floating
rates. The third amended and restated credit agreement provides for variable rate interest that could be adversely affected by an increase in interest rates. As of January 1, 2004, term
borrowings of $509.6 million under the third amended and restated credit agreement were outstanding. Borrowings under this facility bear interest, at the Company's option, at either a base rate
(which is the higher of the prime rate of British Banking Association's or the federal funds rate plus 0.5%) or the Eurodollar rate plus, in each case, an applicable margin. The applicable margin can
range from 1.50% to 3.25% for the revolving credit facility and 2.25% to 2.50% for the term loan facility. The borrowings outstanding under the New Term Loan D facility bore interest of approximately
3.7% as of January 1, 2004. A one-half percent rise in the interest rate on the Company's variable rate indebtedness held at January 1, 2004, would have increased reported
interest expense by approximately $2.5 million for the year ended January 1, 2004.

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Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEPENDENT AUDITORS' REPORT

The
Board of Directors
Regal Cinemas Corporation:

We
have audited the accompanying consolidated balance sheets of Regal Cinemas Corporation and subsidiaries (Reorganized Company) as of January 1, 2004 and December 26, 2002
and the related consolidated statements of operations, shareholders' equity (deficit) and cash flows of the Reorganized Company for the fifty-three weeks ended January 1, 2004 and the
forty-eight weeks ended December 26, 2002 (Reorganized Periods), and of Regal Cinemas, Inc. and subsidiaries (Predecessor Company) for the four weeks ended January 24, 2002
(Predecessor Period). These 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
audits.

We
conducted our audits in accordance with auditing standards generally accepted in the United States of America. 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 audits provide a reasonable basis for our opinion.

In
our opinion, the aforementioned Reorganized Company consolidated financial statements present fairly, in all material respects, the financial position of Regal Cinemas Corporation and
subsidiaries as
of January 1, 2004 and December 26, 2002, and the results of their operations and their cash flows for the fifty-three weeks ended January 1, 2004 and the forty-eight weeks ended
December 26, 2002, in conformity with accounting principles generally accepted in the United States of America. Further, in our opinion, the aforementioned Predecessor Company consolidated
financial statements present fairly, in all material respects the results of operations and cash flows of Regal Cinemas, Inc. and subsidiaries for the four weeks ended January 24, 2002
in conformity with accounting principles generally accepted in the United States of America.

As
described in Notes 1 and 5 of the consolidated financial statements, effective January 24, 2002, Regal Cinemas, Inc. emerged from protection under Chapter 11 of the U.S.
Bankruptcy Code pursuant to a reorganization plan, which was confirmed by the Bankruptcy Court on December 7, 2001. The Company applied the principles of purchase and reorganization accounting
when recording the acquisition and controlling interest by The Anschutz Corporation (Anschutz) whereby its assets, liabilities and new capital structure were adjusted to reflect estimated fair values
and Anschutz' cost basis as of January 24, 2002. As a result, the consolidated financial statements for the periods subsequent to January 24, 2002 reflect the Reorganized Company's new
basis of accounting and are not comparable to the Predecessor Company's pre-organization consolidated financial statements.

As
discussed in Note 2 to the accompanying consolidated financial statements, the Company changed its method of accounting for goodwill and other intangible assets during 2002.

|/s/KPMG LLP |  |  |  | 
|----------- |  |  |  | 

Nashville,
Tennessee
February 6, 2004

---

INDEPENDENT AUDITORS' REPORT

To
the Board of Directors and Shareholders of
Regal Cinemas, Inc.
Knoxville, Tennessee

We
have audited the accompanying consolidated statements of operations, shareholders' equity (deficit), and cash flows for the year ended December 27, 2001 of Regal
Cinemas, Inc. and subsidiaries (debtors-in-possession as of October 11, 2001). These financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on the financial statements based on our audit.

We
conducted our audit in accordance with auditing standards generally accepted in the United States of America. 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, such consolidated financial statements present fairly, in all material respects, the results of operations and cash flows of Regal Cinemas, Inc. and subsidiaries
for the year ended December 27, 2001, in conformity with accounting principles generally accepted in the United States of America.

As
discussed in Note 1 to the consolidated financial statements, the Company filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code with the United
States Bankruptcy Court for the District of Middle Tennessee on October 11, 2001. The Bankruptcy Court confirmed the plan of reorganization on December 7, 2001 and the plan became
effective January 29, 2002, the date the Company emerged from bankruptcy. As described in Note 3, the Company was acquired subsequent to its emergence from bankruptcy. No effects of
accounting for the reorganization or the acquisition are reflected in the 2001 financial statements.

|/s/DELOITTE AND TOUCHE LLP |  | 
|-------------------------- |  | 

Nashville,
Tennessee
February 15, 2002

---



Regal Cinemas Corporation        Consolidated Balance Sheets        (In millions, except share data)

|                                                      |                                                                                               | January 1, 2004                            |       | December 26, 2002 (Note 4) |        
|----------------------------------------------------- | --------------------------------------------------------------------------------------------- | ------------------------------------------ | ----- | -------------------------- | -------
|ASSETS                                                |                                                                                               |                                            |       |                            |        
|Current assets:                                       |                                                                                               |                                            |       |                            |        
|                                                      | Cash and equivalents                                                                          |                                            | $     | 266.3                      |        
|                                                      | Restricted cash                                                                               |                                            |       | 0.6                        |        
|                                                      | Trade and other receivables                                                                   |                                            |       | 34.1                       |        
|                                                      | Inventories                                                                                   |                                            |       | 5.2                        |        
|                                                      | Prepaid and other current assets                                                              |                                            |       | 27.7                       |        
|                                                      | Assets held for sale                                                                          |                                            |       | 6.9                        |        
|                                                      | Deferred tax asset                                                                            |                                            |       | 5.5                        |        
|                                                      |                                                                                               |                                            |       |                            |        
|                                                      |                                                                                               | Total current assets                       |       |                            | 346.3  
|Property and equipment:                               |                                                                                               |                                            |       |                            |        
|                                                      | Land                                                                                          |                                            |       | 114.1                      |        
|                                                      | Buildings and leasehold improvements                                                          |                                            |       | 1,187.6                    |        
|                                                      | Equipment                                                                                     |                                            |       | 651.4                      |        
|                                                      | Construction in progress                                                                      |                                            |       | 8.7                        |        
|                                                      |                                                                                               |                                            |       |                            |        
|                                                      |                                                                                               | Total property and equipment               |       |                            | 1,961.8
|                                                      | Accumulated depreciation and amortization                                                     |                                            |       | (263.3                     | )      
|                                                      |                                                                                               |                                            |       |                            |        
|                                                      |                                                                                               | Total property and equipment, net          |       |                            | 1,698.5
|Goodwill and other intangible assets                  |                                                                                               |                                            | 114.3 |                            |        
|Deferred tax asset                                    |                                                                                               |                                            | 63.4  |                            |        
|Other non-current assets                              |                                                                                               |                                            | 34.8  |                            |        
|                                                      |                                                                                               |                                            |       |                            |        
|                                                      |                                                                                               | Total assets                               |       | $                          | 2,257.3
|                                                      |                                                                                               |                                            |       |                            |        
|LIABILITIES AND SHAREHOLDERS' EQUITY                  |                                                                                               |                                            |       |                            |        
|Current liabilities:                                  |                                                                                               |                                            |       |                            |        
|                                                      | Current maturities of long-term obligations                                                   |                                            | $     | 30.6                       |        
|                                                      | Accounts payable                                                                              |                                            |       | 169.3                      |        
|                                                      | Accrued expenses                                                                              |                                            |       | 77.8                       |        
|                                                      | Income taxes payable                                                                          |                                            |       | 44.0                       |        
|                                                      | Deferred revenues                                                                             |                                            |       | 65.1                       |        
|                                                      | Bankruptcy related liabilities and claims                                                     |                                            |       | 3.5                        |        
|                                                      |                                                                                               |                                            |       |                            |        
|                                                      |                                                                                               | Total current liabilities                  |       |                            | 390.3  
|Long-term debt, less current maturities               |                                                                                               |                                            | 834.7 |                            |        
|Capital leases, less current maturities               |                                                                                               |                                            | 22.2  |                            |        
|Lease financing arrangements, less current maturities |                                                                                               |                                            | 93.8  |                            |        
|Other non-current liabilities                         |                                                                                               |                                            | 57.4  |                            |        
|                                                      |                                                                                               |                                            |       |                            |        
|                                                      |                                                                                               | Total liabilities                          |       |                            | 1,398.4
|Shareholders' equity:                                 |                                                                                               |                                            |       |                            |        
|                                                      | Preferred stock, $.001 par value; 5,000,000 shares authorized; none issued and outstanding    |                                            |       |                           |        
|                                                      | Common stock; $.001 par value; 25,000,000 shares authorized; 7,500,000 issued and outstanding |                                            |       |                           |        
|                                                      | Additional paid-in capital                                                                    |                                            |       | 635.0                      |        
|                                                      | Unamortized deferred stock compensation                                                       |                                            |       | (7.0                       | )      
|                                                      | Retained earnings                                                                             |                                            |       | 230.9                      |        
|                                                      |                                                                                               |                                            |       |                            |        
|                                                      |                                                                                               | Total shareholders' equity                 |       |                            | 858.9  
|                                                      |                                                                                               |                                            |       |                            |        
|                                                      |                                                                                               | Total liabilities and shareholders' equity |       | $                          | 2,257.3
|                                                      |                                                                                               |                                            |       |                            |        

See accompanying notes to consolidated financial statements.

---



Regal Cinemas Corporation        Consolidated Statements of Operations        (In millions)

|                    |                                                                                   | Reorganized Company      |   | Predecessor Company |        
|------------------- | --------------------------------------------------------------------------------- | ------------------------ | - | ------------------- | -------
|
|Revenues:           |                                                                                   |                          |   |                     |        
|                    | Admissions                                                                        |                          | $ | 1,454.0             |        
|                    | Concessions                                                                       |                          |   | 553.1               |        
|                    | Other operating revenues                                                          |                          |   | 151.0               |        
|                    |                                                                                   |                          |   |                     |        
|                    |                                                                                   | Total revenue            |   |                     | 2,158.1
|Operating expenses: |                                                                                   |                          |   |                     |        
|                    | Film rental and advertising costs                                                 |                          |   | 784.9               |        
|                    | Cost of concessions                                                               |                          |   | 79.5                |        
|                    | Contractual rent                                                                  |                          |   | 213.7               |        
|                    | Straight-line rent adjustment                                                     |                          |   | 13.9                |        
|                    | Other operating expenses                                                          |                          |   | 507.8               |        
|                    | General and administrative expenses                                               |                          |   | 58.1                |        
|                    | Merger and restructuring expenses and amortization of deferred stock compensation |                          |   | 4.8                 |        
|                    | Depreciation and amortization                                                     |                          |   | 141.8               |        
|                    | Theatre closing costs and net loss (gain) on disposal of operating assets         |                          |   | (3.5                | )      
|                    | Loss on impairment of assets                                                      |                          |   | 1.5                 |        
|                    |                                                                                   |                          |   |                     |        
|                    |                                                                                   | Total operating expenses |   |                     | 1,802.5
|                    |                                                                                   |                          |   |                     |        
|                    | Income (loss) from operations                                                     |                          |   | 355.6               |        
|                    | Other income (expense):                                                           |                          |   |                     |        
|                    | Interest expense                                                                  |                          |   | (67.4               | )      
|                    | Interest and other income                                                         |                          |   | 1.5                 |        
|                    | Gain (loss) on extinguishment of debt                                             |                          |   |                    |        
|                    |                                                                                   |                          |   |                     |        
|                    | Income (loss) before reorganization items and income taxes                        |                          |   | 289.7               |        
|                    | Reorganization items                                                              |                          |   |                    |        
|                    |                                                                                   |                          |   |                     |        
|                    | Income (loss) before income taxes                                                 |                          |   | 289.7               |        
|                    | Provision for income taxes                                                        |                          |   | (114.5              | )      
|                    |                                                                                   |                          |   |                     |        
|                    | Net income (loss)                                                                 |                          | $ | 175.2               |        
|                    |                                                                                   |                          |   |                     |        

See accompanying notes to consolidated financial statements.

---



Regal Cinemas Corporation        Consolidated Statements of Shareholders' Equity (Deficit)        (In millions, except share amounts)

|                                                 |                                                                                     | Common
Stock |       | Additional
Paid-In
Capital |   | Deferred Stock
Compensation |        | Loans to
Shareholders |      | Retained
Earnings
(Deficit) |   | Total |    
|------------------------------------------------ | ----------------------------------------------------------------------------------- | ------------ | ----- | -------------------------- | - | --------------------------- | ------ | --------------------- | ---- | --------------------------- | - | ----- | ---
|PREDECESSOR BALANCES, DECEMBER 28, 2000          |                                                                                     | $            | 196.8 |                            | $ |                            |        | $                     |     |                             | $ | (3.4  | )  
|                                                 | Cancellation of 69,857 shares of common stock                                       |              |       | (0.3                       | ) |                             |       |                       |      |                            |   |       | 0.3
|                                                 | Net loss and comprehensive loss                                                     |              |       |                           |   |                             |       |                       |      |                            |   |       |   
|                                                 |                                                                                     |              |       |                            |   |                             |        |                       |      |                             |   |       |    
|PREDECESSOR BALANCES, DECEMBER 27, 2001          |                                                                                     |              | 196.5 |                            |   |                            |        |                       |     |                             |   | (3.1  | )  
|                                                 | Net loss and comprehensive loss                                                     |              |       |                           |   |                             |       |                       |      |                            |   |       |   
|                                                 | Elimination of predecessor equity accounts in connection with fresh-start reporting |              |       | (196.5                     | ) |                             |       |                       |      |                            |   |       | 3.1
|                                                 | Issuance of equity in Reorganized Company                                           |              |       |                           |   |                             | 602.5  |                       |      |                            |   |       |   
|                                                 |                                                                                     |              |       |                            |   |                             |        |                       |      |                             |   |       |    
|REORGANIZED BALANCES, JANUARY 24, 2002           |                                                                                     |              |      |                            |   | 602.5                       |        |                       |     |                             |   |      |    
|                                                 |                                                                                     |              |       |                            |   |                             |        |                       |      |                             |   |       |    
|                                                 | Parent's basis in Edwards acquired by RCI                                           |              |       |                           |   |                             | 84.2   |                       |      |                            |   |       |   
|                                                 | Parent's basis in UATG acquired by RCI (Note 4)                                     |              |       |                           |   |                             | 251.8  |                       |      |                            |   |       |   
|                                                 | Exchange of common stock in Regal Cinemas for Regal Entertainment Group             |              |       |                           |   |                             | 56.8   |                       |      | (10.9                       | ) |       |   
|                                                 | Loss on redemption of redeemable preferred stock                                    |              |       |                           |   |                             |       |                       |      |                            |   |       |   
|                                                 | Excess purchase price retained by parent                                            |              |       |                           |   |                             | (34.5  | )                     |      |                            |   |       |   
|                                                 | Equity of RCM at acquisition date                                                   |              |       |                           |   |                             | 10.0   |                       |      |                            |   |       |   
|                                                 | Capital contribution from parent                                                    |              |       |                           |   |                             | 12.5   |                       |      |                            |   |       |   
|                                                 | Stock distribution of subsidiaries to parent                                        |              |       |                           |   |                             | (15.9  | )                     |      |                            |   |       |   
|                                                 | Amortization of deferred stock compensation                                         |              |       |                           |   |                             |       |                       |      | 1.0                         |   |       |   
|                                                 | Tax benefit from exercise of stock options                                          |              |       |                           |   |                             | 2.0    |                       |      |                            |   |       |   
|                                                 | Forfeiture of stock options                                                         |              |       |                           |   |                             | (0.1   | )                     |      | 0.1                         |   |       |   
|                                                 | Net income and comprehensive income (Note 4)                                        |              |       |                           |   |                             |       |                       |      |                            |   |       |   
|                                                 |                                                                                     |              |       |                            |   |                             |        |                       |      |                             |   |       |    
|REORGANIZED BALANCES, DECEMBER 26, 2002 (Note 4) |                                                                                     |              |      |                            |   | 969.3                       |        |                       | (9.8 | )                           |   |      |    
|                                                 | Cash paid to purchase assets of UATG                                                |              |       |                           |   |                             | (311.4 | )                     |      |                            |   |       |   
|                                                 | Adjustment to parent's basis in UATG acquired by RCI                                |              |       |                           |   |                             | (23.3  | )                     |      |                            |   |       |   
|                                                 | Dividends to parent                                                                 |              |       |                           |   |                             |       |                       |      |                            |   |       |   
|                                                 | Amortization of deferred stock compensation                                         |              |       |                           |   |                             |       |                       |      | 2.7                         |   |       |   
|                                                 | Tax benefit from exercise of stock options                                          |              |       |                           |   |                             | 0.5    |                       |      |                            |   |       |   
|                                                 | Forfeiture of stock options                                                         |              |       |                           |   |                             | (0.1   | )                     |      | 0.1                         |   |       |   
|                                                 | Net income and comprehensive income                                                 |              |       |                           |   |                             |       |                       |      |                            |   |       |   
|                                                 |                                                                                     |              |       |                            |   |                             |        |                       |      |                             |   |       |    
|REORGANIZED BALANCES, JANUARY 1, 2004            |                                                                                     | $            |      |                            | $ | 635.0                       |        | $                     | (7.0 | )                           | $ |      |    
|                                                 |                                                                                     |              |       |                            |   |                             |        |                       |      |                             |   |       |    

See accompanying notes to consolidated financial statements.

---



Regal Cinemas Corporation        Consolidated Statements of Cash Flows        (In millions)

|                                                                                   |                                                                              | Reorganized Company                                                                      |                                        | Predecessor Company                                 |      
|---------------------------------------------------------------------------------- | ---------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------- | -------------------------------------- | --------------------------------------------------- | -----
|
|Cash Flows from operating activities:                                              |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   | Net income (loss)                                                            |                                                                                          | $                                      | 175.2                                               |      
|                                                                                   |                                                                              | Adjustments to reconcile net income (loss) to net cash provided by operating activities: |                                        |                                                     |      
|                                                                                   |                                                                              | Depreciation and amortization                                                            |                                        |                                                     | 141.8
|                                                                                   |                                                                              | Provision for deferred income taxes                                                      |                                        |                                                     | 8.7  
|                                                                                   |                                                                              | Amortization of deferred stock compensation                                              |                                        |                                                     | 2.7  
|                                                                                   |                                                                              | Cancellation of shareholder loans                                                        |                                        |                                                     |     
|                                                                                   |                                                                              | Loss on impairment of assets                                                             |                                        |                                                     | 1.5  
|                                                                                   |                                                                              | (Gain) loss on disposal of operating assets and theatre closing costs                    |                                        |                                                     | (3.5 
|                                                                                   |                                                                              | Loss (gain) on extinguishment of debt                                                    |                                        |                                                     |     
|                                                                                   |                                                                              | Reorganization items                                                                     |                                        |                                                     |     
|Changes in operating assets and liabilities, net of acquisitions and dispositions: |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   |                                                                              |                                                                                          | Trade and other receivables            |                                                     |      
|                                                                                   |                                                                              |                                                                                          | Inventories                            |                                                     |      
|                                                                                   |                                                                              |                                                                                          | Prepaids and other assets              |                                                     |      
|                                                                                   |                                                                              |                                                                                          | Accounts payable                       |                                                     |      
|                                                                                   |                                                                              |                                                                                          | Income taxes payable                   |                                                     |      
|                                                                                   |                                                                              |                                                                                          | Accrued expenses and other liabilities |                                                     |      
|                                                                                   |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   |                                                                              |                                                                                          |                                        | Net cash provided by (used in) operating activities |      
|Cash flows from investing activities:                                              |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   | Capital expenditures                                                         |                                                                                          |                                        | (136.5                                              | )    
|                                                                                   | Cash used to acquire Hoyts, net of cash acquired                             |                                                                                          |                                        | (187.7                                              | )    
|                                                                                   | Cash used to acquire UATG                                                    |                                                                                          |                                        | (311.4                                              | )    
|                                                                                   | Proceeds from disposition of fixed assets                                    |                                                                                          |                                        | 16.1                                                |      
|                                                                                   | Net decrease in restricted cash and other investing activities               |                                                                                          |                                        | 31.0                                                |      
|                                                                                   |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   |                                                                              |                                                                                          |                                        | Net cash used in investing activities               |      
|Cash flows from financing activities:                                              |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   | Proceeds from new senior credit facility                                     |                                                                                          |                                        | 315.0                                               |      
|                                                                                   | Cash used to pay dividend to parent                                          |                                                                                          |                                        | (42.3                                               | )    
|                                                                                   | Payments on new senior credit facility                                       |                                                                                          |                                        | (24.8                                               | )    
|                                                                                   | Proceeds from new senior subordinated notes                                  |                                                                                          |                                        |                                                    |      
|                                                                                   | Payment of debt financing costs                                              |                                                                                          |                                        | (5.9                                                | )    
|                                                                                   | Cash of Edwards at contribution date                                         |                                                                                          |                                        |                                                    |      
|                                                                                   | Cash of UATG and Regal CineMedia at acquisition date                         |                                                                                          |                                        |                                                    |      
|                                                                                   | Excess purchase price retained by parent                                     |                                                                                          |                                        |                                                    |      
|                                                                                   | Capital contribution from parent                                             |                                                                                          |                                        |                                                    |      
|                                                                                   | Cash used to redeem Edwards preferred stock                                  |                                                                                          |                                        |                                                    |      
|                                                                                   | Cash used to redeem Edwards senior subordinated notes                        |                                                                                          |                                        |                                                    |      
|                                                                                   | Cash used to payoff Edwards term loan                                        |                                                                                          |                                        |                                                    |      
|                                                                                   | Payment of bankruptcy claims and liabilities                                 |                                                                                          |                                        | (22.4                                               | )    
|                                                                                   | Borrowings under long-term obligations                                       |                                                                                          |                                        |                                                    |      
|                                                                                   | Payments on other long-term obligations                                      |                                                                                          |                                        | (5.8                                                | )    
|                                                                                   | Proceeds from interest rate swap terminations                                |                                                                                          |                                        |                                                    |      
|                                                                                   | Payment of old senior credit facility                                        |                                                                                          |                                        |                                                    |      
|                                                                                   | Payment of old senior subordinated notes                                     |                                                                                          |                                        |                                                    |      
|                                                                                   | Payment of old equipment financing                                           |                                                                                          |                                        |                                                    |      
|                                                                                   | Other debt and capital lease activity                                        |                                                                                          |                                        |                                                    |      
|                                                                                   |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   |                                                                              |                                                                                          |                                        | Net cash provided by (used in) financing activities |      
|                                                                                   | Cash used in reorganization                                                  |                                                                                          |                                        |                                                    |      
|                                                                                   |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   |                                                                              |                                                                                          |                                        | Net increase (decrease) in cash equivalents         |      
|                                                                                   | Cash and cash equivalents, beginning of period                               |                                                                                          |                                        | 178.7                                               |      
|                                                                                   |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   |                                                                              |                                                                                          |                                        | Cash and cash equivalents, end of period            |      
|                                                                                   |                                                                              |                                                                                          |                                        |                                                     |      
|SUPPLEMENTAL CASH FLOW INFORMATION:                                                |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   | Cash paid (refunds received) for income taxes, net                           |                                                                                          | $                                      | 32.9                                                |      
|                                                                                   | Cash paid for interest                                                       |                                                                                          |                                        | 65.5                                                |      
|SUPPLEMENTAL NON-CASH FINANCING ACTIVITIES:                                        |                                                                              |                                                                                          |                                        |                                                     |      
|                                                                                   | Adjustments to parent's basis in UATG acquired by RCI                        |                                                                                          |                                        | (23.3                                               | )    
|                                                                                   | Exchange of RCI senior term debt for common stock                            |                                                                                          | $                                      |                                                    |      
|                                                                                   | Capitalization of lease financing arrangements                               |                                                                                          |                                        |                                                    |      
|                                                                                   | Exchange of minorities shares in Regal Cinemas for Regal Entertainment Group |                                                                                          |                                        |                                                    |      
|                                                                                   | Parent's basis in Edwards acquired by RCI                                    |                                                                                          |                                        |                                                    |      
|                                                                                   | Non-cash distribution of subsidiary to parent                                |                                                                                          |                                        |                                                    |      

See accompanying notes to consolidated financial statements.

---



REGAL CINEMAS CORPORATION        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. THE COMPANY AND BASIS OF PRESENTATION

Regal Cinemas Corporation and its wholly owned subsidiaries (collectively, the "Company" or "Regal Cinemas"), including Regal Cinemas, Inc. ("RCI") and its
subsidiaries, which include Edwards Theatres, Inc. ("Edwards"), Regal CineMedia Corporation ("RCM"), Hoyts Cinemas Corporation ("Hoyts") and United Artists Theatre Group LLC ("UATG"), operate
multi-screen motion picture theatres throughout the United States. As of January 1, 2004, the Company operated 5,110 screens in 430 theatres in 37 states. The Company formally operates on a
52-week fiscal year with each quarter generally consisting of 13 weeks, unless otherwise noted. The Company's fiscal year ends on the first Thursday after December 25, which in
certain years (such as Fiscal 2003) results in a 53-week fiscal year.

On
October 11, 2001, RCI and its subsidiaries at that time filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court for the Middle District of Tennessee (the "Bankruptcy Court") under case numbers 301-11305 through 301-11320 (the "Chapter 11 Case") seeking court
supervision of RCI's restructuring efforts. Pursuant to the plan of reorganization (the "Plan"), holders of its then existing senior credit facilities agreed to exchange approximately
$725 million of their pre-petition claims for 100% of RCI's newly-issued common stock. Other principal terms of the Plan included:



On
December 7, 2001, the Bankruptcy Court confirmed the Plan and as a result, RCI commenced appropriate actions to consummate the Plan and emerged from bankruptcy on
January 29, 2002 with The Anschutz Corporation and its subsidiaries ("Anschutz") acquiring a controlling equity interest. Also on January 29, 2002, RCI became a wholly owned subsidiary
of Regal Cinemas when Anschutz and the other shareholders of RCI exchanged their common stock of RCI for 7,500,000 shares of Regal Cinemas.

Regal
Cinemas was formed for the primary purpose of becoming a borrower under the senior credit facilities and the issuer of the $200 million of 93/8% senior
subordinated notes due 2012 issued upon RCI's emergence from bankruptcy. Approximately $1.8 billion of RCI's long-term debt plus approximately $196 million of accrued and
unpaid interest was discharged under the terms of the Plan in exchange for total payments of approximately $575.3 million. The Company funded these payments through (i) cash on hand of
RCI, (ii) a term loan ($270 million) borrowed under new senior credit facilities, and (iii) the issuance of $200 million of new 93/8% senior subordinated
notes due 2012.

As
described in Note 4"Acquisitions," RCI acquired all of the outstanding capital stock of Edwards, RCM, Hoyts and UATG from a subsidiary of its parent corporation,
Regal Entertainment Group ("REG"), during 2002 and 2003. Unless otherwise noted, the "Company" or "Regal Cinemas" refers to Regal Cinemas Corporation and its subsidiaries on a consolidated basis,
which includes RCI, Edwards and the assets of UATG as of January 24, 2002 and RCM as of February 21, 2002, the

---

deemed
dates at which Anschutz initially held common control in RCI, Edwards, RCM and the assets of UATG, and includes Hoyts as of March 28, 2003, the date at which REG initially held common
control in both RCI and Hoyts.

The
consolidated financial statements of the Company after RCI's emergence from bankruptcy reflect the predecessor cost basis of Anschutz and the reorganization value attributable to the
common stock owned by the other RCI stockholders. The Company's 2002 consolidated financial statements include information reflecting the four week period ended January 24, 2002
(pre-reorganization) and the forty-eight week period ended December 26, 2002 (post-reorganization), which includes the results of operations of Edwards and the assets of
UATG from January 24, 2002 and of RCM from February 21, 2002, the deemed dates at which Anschutz initially held common control in RCI, Edwards, RCM and the assets of UATG. As a result,
the Company's post-reorganization consolidated financial statements have not been prepared on a consistent basis with the pre-reorganization consolidated financial statements
and are not comparable in all respects to the consolidated financial statements prior to the reorganization. For financial reporting purposes, the inception date of the Reorganized Company (as defined
below) is deemed to have occurred on January 24, 2002. As such, operating results and financial position for periods subsequent to January 24, 2002 are herein referred to as the
"Reorganized Company" and for all periods ending on or prior to January 24, 2002 as the "Predecessor Company". See Note 5"Reorganization" for a summary of the Company's
reorganization to purchase accounting adjustments. The Company's 2003 consolidated financial statements include information reflecting the results of operations of Hoyts for all periods subsequent to
its acquisition by the Company on March 28, 2003.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



The consolidated financial statements include the accounts of Regal Cinemas. All significant intercompany accounts and transactions have been eliminated in
consolidation.



Revenues are generated principally through admissions and concessions sales with proceeds received in cash at the point of sale. Other operating revenues consist
primarily of product advertising (including vendor marketing programs) and other ancillary revenues which are recognized as income in the period earned. We recognize payments received attributable to
the marketing and advertising services provided by us under certain vendor programs as revenue in the period in which the related impressions are delivered. Such impressions are measured by the
concession product sales volume, which is a mutually agreed upon proxy of attendance and reflects our marketing and advertising services delivered to our
vendors. Proceeds received from advance ticket sales and gift certificates are recorded as deferred revenue. The Company recognizes revenue associated with gift certificates and advanced ticket sales
at such time as the items are redeemed, they expire or redemption becomes unlikely. The determination of the likelihood of redemption is based on an analysis of our historical redemption trends.



The Company considers all unrestricted highly liquid debt instruments and investments purchased with an original maturity of three months or less to be cash
equivalents. At January 1, 2004, the Company held substantially all of its cash in temporary cash investments in the form of certificates of deposit and variable rate investment accounts with
major financial institutions.

---



On the Edwards Effective Date, Edwards funded a $35.0 million cash reserve for the payment of certain allowed claims. The cash reserve is permitted to be
reduced to the lesser of (i) $20 million; or (ii) the sum of the unpaid: (a) disputed claims that have elected the cash option; and (b) allowed claims that have
elected the cash option. The restricted cash has been placed in a segregated account in which such holders of the allowed claims that have elected the cash option have a first priority security
interest. The restricted cash is classified as a current asset as the related claims are classified as current liabilities.



Reimbursable construction advances consist of amounts due from landlords to fund a portion of the construction costs of new theatres that the Company will operate
pursuant to lease agreements. The landlords repay the amounts either during construction on a percentage of completion basis, or upon completion of the theatre.



Inventories consist of concession products and theatre supplies. The Company states inventories on the basis of first-in, first-out (FIFO)
cost, which is not in excess of net realizable value.



Prepaid expenses and other current assets include prepaid occupancy costs, which are deferred according to the monthly payment terms underlying the Company's
occupancy agreements (generally one month in advance) and amortized over the period in which such occupancy costs are incurred. As of January 1, 2004 and December 26, 2002, the Company
had recorded approximately $19.4 million and $16.7 million related to such occupancy costs.



The Company states property and equipment at cost. Major renewals and improvements are capitalized, while replacements, maintenance and repairs which do not
improve or extend the lives of the respective assets, are expensed currently. Gains and losses from disposition of property and equipment are included in income and expense when realized. The Company
records depreciation and amortization using the straight-line method over the following estimated useful lives:

Buildings

20-30 yearsEquipment

3-20 yearsLeasehold improvements

Lesser of term of lease or asset life


Included
in property and equipment is $106.8 million and $91.4 million of assets accounted for under capital leases and lease financing arrangements as of January 1,
2004 and December 26, 2002, respectively. The Company records amortization using the straight-line method over the shorter of the lease terms or the estimated useful lives noted
above.

---



The changes in the carrying amount of goodwill for the fifty-three weeks ended January 1, 2004, the forty-eight weeks ended December 26, 2002 and
the four weeks ended January 24, 2002 are as follows:

(Reorganized
Company)

(Reorganized
Company)

(Predecessor
Company)Fifty-three
weeks ended
January 1, 2004

Forty-eight
weeks ended
December 26, 2002

Four weeks ended
January 24, 2002Balance at beginning of period

$
115.5

$
1.0

$
336.2Adjustments related to certain pre-acquisition deferred tax assets of Regal Cinemas and Edwards and other


(2.1
)




Goodwill from acquisition of Hoyts (Note 4)


0.9





Goodwill from acquisition of UATG (Note 4)





56.3


Contribution of Edwards outstanding common stock purchased from minority security holders





23.6


Exchange of minority shares in Regal Cinemas and Edwards for REG





82.4


Adjustments related to certain pre-acquisition deferred tax assets of Regal Cinemas, United Artists, Edwards and UATG





(52.4
)

Purchase accounting and reorganization adjustments and other





4.6


(335.2
)Balance at end of period

$
114.3

$
115.5

$
1.0


SFAS
No. 142, "Goodwill and Other Intangible Assets," became effective for the Company in the first quarter of fiscal 2002. This standard revised the financial accounting and
reporting for goodwill and certain intangible assets. Among the revisions were the discontinuation of the amortization of goodwill and certain intangible assets and the periodic testing (at least
annually) for the impairment of goodwill at a reporting unit level and additional financial statement disclosures. The Company has identified its reporting units under SFAS No. 142 to be the
designated market areas in which the Company conducts its theatre operations. The fair value of the Company's identified reporting units was estimated using the expected present value of associated
future cash flows and market values of the underlying theatres within each reporting unit. The Company's annual goodwill impairment assessment for the fifty-three weeks ended January 1, 2004
indicated that the fair value of its reporting units exceeded their carrying value and therefore, at this time, goodwill was not deemed to be impaired. As required by SFAS No. 142, the
discontinuation of goodwill (excess reorganization value) amortization has not been retroactively applied to the results for the period prior to adoption. Amortization relating to goodwill was
$10.4 million for the year ended December 27, 2001. The following is pro-forma

---

information
of the Company assuming that SFAS No. 142 had been in effect during the period ended December 27, 2001 and goodwill amortization expense had not been recorded (in millions):

(Predecessor
Company)Period ended
December 27, 2001Net loss, as reported:

$
(171.5
)Add: Goodwill amortization, net of related tax effect


10.4Adjusted pro forma net loss

$
(161.1
)




The Company reviews long-lived assets (including property and equipment, goodwill and other intangible assets) for impairment whenever events or
changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable. The Company evaluates assets for impairment on an individual theatre basis, which management
believes is the lowest level for which there are identifiable cash flows. If the sum of the expected future cash flows, undiscounted and without interest charges is less than the carrying amount of
the assets, the Company recognizes an impairment charge in the amount by which the carrying value of the assets exceeds their fair market value. The fair value of assets is determined using the
present value of the estimated future cash flows or the expected selling price less selling costs for assets of which the Company expects to dispose. This analysis resulted in the recording of
impairment charges of $1.5 million, $0.5 million and $78.5 million for the fifty-three weeks ended January 1, 2004, the four weeks ended January 24, 2002 and fiscal
year 2001, respectively.



In connection with the series of events leading to RCI's Chapter 11 bankruptcy reorganization, the Company elected to close a number of under-performing theatre
locations. The Company recorded $21.4 million during 2001 as the net loss on disposal of these locations. In conjunction with such closed or abandoned locations, the Company recorded an accrual
for lease termination and related costs of $40.1 million at December 27, 2001. This accrual represented management's best estimate of the potential costs for exiting these leases and was
based on analyses of the properties, correspondence with the landlord, exploratory discussions with potential sub-lessees and individual market conditions. Also included in theatre closing
costs are other expenses incurred by the Company upon closure of certain theatres as well as any unpaid rent. During 2001, in accordance with SOP 90-7, "Financial Reporting by Entities in
Reorganization Under the Bankruptcy Code," the Company revised its estimates for the remaining leasehold obligations in accordance with Section 502(b)(6) of the Bankruptcy Code, which limits a
lessor's claim to the rent reserved by such lease, without acceleration, to the greater of one year or 15 percent, not to exceed three years, of the remaining term of the lease.

---

The
following is a summary of the activity in this accrual (in millions):

(Predecessor
Company)December 27, 2001Beginning balance

$
41.5Rent and other termination payments


(10.5
)Additional closing and termination costs


43.1Revision of prior estimates


(34.0
)Ending balance

$
40.1


This
accrual was included in "Liabilities Subject to Compromise" at December 27, 2001. Upon RCI's emergence from bankruptcy, the accrual was subsequently reclassified as a
component of "Bankruptcy Related Liabilities and Claims." During 2002 and 2003, the Company made payments totaling approximately $35.9 million and 2.6 million, respectively, related to
this accrual. As of January 1, 2004 and December 26, 2002, approximately $1.5 million and $6.3 million, respectively, of this accrual was outstanding.



Other non-current assets include debt acquisition costs, which are deferred and amortized over the terms of the related agreements using the
straight-line method which approximates the effective interest method. Debt acquisition costs as of January 1, 2004 and December 26, 2002 were $25.7 million and
$23.6 million, respectively, net of accumulated amortization of $6.6 million and $2.7 million, respectively.



Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. In
addition, income tax rules and regulations are subject to interpretation and require judgment by the Company and may be challenged by the tax authorities. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company records a valuation allowance if it is deemed more likely than not that its
deferred income tax assets will not be realized.

The
Company expects that certain deferred income tax assets are not more likely than not to be recovered and therefore, has set established a valuation allowance. The Company reassesses
its need for the valuation allowance for its deferred income taxes on an ongoing basis. Should the Company realize certain tax assets with a valuation allowance that relate to
pre-acquisition periods, goodwill would be reduced.



Deferred revenue relates primarily to vendor programs, gift certificates and advance ticket sales, and we recognize such amounts as revenue as described above in
this Note 2 under "Revenue Recognition."

---



The Company recognizes rent on a straight-line basis after considering the effect of rent escalation provisions resulting in a level monthly rent
expense for each lease over its term. The deferred rent liability is included in other non-current liabilities.



The Company estimates its film cost expense and related film cost payable based on management's best estimate of the ultimate settlement of the film costs with
the distributors. Generally, less than one-third of our quarterly film expense 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.



The Company expenses advertising costs as incurred. Start-up costs associated with a new theatre are also expensed as incurred.



In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based CompensationTransition and Disclosure." SFAS No.148 amends
SFAS No. 123, "Accounting for Stock-Based Compensation," to provide alternative methods of transition for a voluntary change to SFAS No. 123's fair value based method of accounting for
stock-based employee compensation. In addition, SFAS No. 148 amends the disclosure requirements of SFAS No.123 and APB Opinion No. 28, "Interim Financial Reporting," to require
disclosure in the summary of significant accounting policies of the effects of an entity's accounting policy with respect to stock-based employee compensation on reported net income and earnings per
share in annual and interim financial statements. Under SFAS No. 123, entities are permitted to recognize as expense the fair value of all stock-based awards on the date of grant over the
vesting period and alternatively allows entities to continue to apply the provisions of APB Opinion No. 25, "Accounting for Stock Issued to Employees" and related interpretations, and provide
pro forma net income or loss and earnings or loss per share disclosures as if the fair-value-based method defined in SFAS No. 123 had been applied.

The
Company has elected to continue accounting for its stock option grants under the REG 2002 Stock Incentive Plan using the intrinsic value method in accordance with the provisions of
APB No. 25, which requires compensation costs to be recognized for the excess of the fair value of options on the date of grant over the option exercise price. Had the fair value of options
granted under the Company's stock option plan described in Note 10"Capital Stock and Stock Option Plan" been recognized in accordance with SFAS No. 123 as compensation
expense on a straight-line basis over the

---

vesting
period of the grants, the Company's reported net income would have been recorded in the amounts indicated below (in millions):

|                                                                                                                                               |  | Fifty-three
weeks ended
January 1, 2004
(Reorganized
Company) |       | Forty-eight
weeks ended
December 26, 2002
(Reorganized
Company) |   | Four weeks ended
January 24, 2002
(Predecessor
Company) |   | Year ended
December 27, 2001
(Predecessor
Company) |      
|---------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------- | ----- | --------------------------------------------------------------- | - | ------------------------------------------------------- | - | -------------------------------------------------- | -----
|Net income (loss), as reported:                                                                                                                |  | $                                                             | 175.2 |                                                                 | $ | 126.2                                                   |   | $                                                  | 420.8
|Less: additional stock-based employee compensation expense determined under fair value based method for all awards, net of related tax effects |  |                                                               | (1.6  | )                                                               |   | (2.1                                                    | ) |                                                    | (0.1 
|                                                                                                                                               |  |                                                               |       |                                                                 |   |                                                         |   |                                                    |      
|Pro forma net income (loss)                                                                                                                    |  | $                                                             | 173.6 |                                                                 | $ | 124.1                                                   |   | $                                                  | 420.7
|                                                                                                                                               |  |                                                               |       |                                                                 |   |                                                         |   |                                                    |      

The
pro forma results do not purport to indicate the effects on reported net income for recognizing compensation expense that is expected to occur in future years. The fair value of each
option grant is estimated on the date of grant using the Black-Scholes option pricing model using the following weighted-average assumptions for options granted during the forty-eight weeks ended
December 26, 2002: expected annual dividend yields of 0.0 to 3.0%; expected volatility of 0.0 to 0.389; expected lives of 7.5 years; and a risk-free interest rates ranging
from 4.59-4.83%. The weighted average grant date fair value of stock options granted during 2002 was $4.48. There were no options granted during the year ended December 27, 2001,
the four weeks ended January 24, 2002 or the fifty-three weeks ended January 1, 2004.



The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America 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 consolidated financial
statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates.

The
Company applied the principles of purchase and reorganization accounting when recording the acquisitions of controlling equity interests by Anschutz and the exchange of stock for
minority interests and the emergence from bankruptcy of the theatre companies. These accounting principles require that the Company estimate the fair value of the individual assets and liabilities
including estimates of bankruptcy-related claims. The valuation of the fair value of the assets and liabilities involves a number of judgments and estimates that could differ significantly from actual
amounts.



The Company manages its business under one reportable segmenttheatre exhibition operations.



Net income and comprehensive income are the same for all periods presented.

---



Certain reclassifications have been made to the 2001 and 2002 consolidated financial statements to conform to the 2003 presentation.



Effective December 27, 2002, the Company adopted SFAS No. 143, "Accounting for Asset Retirement Obligations." SFAS No. 143 establishes
accounting standards for recognition and measurement of the fair value of obligations associated with the retirement of long-lived assets when there is a legal obligation to incur such
costs. Under SFAS No. 143, the costs of retiring an asset will be recorded as a liability when the retirement obligation arises and will be amortized to expense over the life of the asset. The
adoption of SFAS No. 143 did not have a material impact on the Company's consolidated financial position or results of operations.

In
April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections."
SFAS No. 145 updates, clarifies and simplifies existing accounting pronouncements including the rescission of Statement 4, which required all gains and losses from extinguishments of debt to be
aggregated and, if material, classified as an extraordinary item, net of related income tax effect. As a result, the criteria in APB Opinion No. 30 will now be used to classify those gains and
losses. As a result of the Company's adoption of SFAS No. 145 on December 27, 2002, the loss/gain from debt extinguishment during fiscal 2002 and fiscal 2001 have been reclassified to
earnings from continuing operations.

Effective
December 27, 2002, the Company adopted SFAS No. 146, "Accounting for Costs Associated with Exit or Disposal Activities." SFAS No. 146 addresses significant
issues relating to the recognition, measurement, and reporting of costs associated with exit and disposal activities, including restructuring activities, and nullifies the guidance in Emerging Issues
Task Force ("EITF") Issue No. 94-3 (EITF 94-3), "Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in a Restructuring)." Retroactive application of SFAS No. 146 is prohibited and, accordingly, liabilities recognized prior to the initial application of SFAS No. 146 will
continue to be accounted for in accordance with EITF 94-3 or other applicable preexisting guidance. Such adoption did not have a material impact on the Company's consolidated financial
position or results of operations.

In
November 2002, the FASB issued Interpretation No. 45, "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness
of Others." This interpretation will significantly change current practice in the accounting for, and disclosure of, guarantees. Guarantees meeting the characteristics described in the interpretation
are required to be initially recorded at fair value, which is different from general current practice of recognition of a liability only when loss is probable and reasonably estimable, as prescribed
in SFAS No. 5, "Accounting for Contingencies." The interpretation also requires a guarantor to make significant new disclosures for virtually all guarantees even if the likelihood of the
guarantor's having to make payments under the guarantee is remote. The disclosure requirements in this interpretation were effective for financial statements of interim or annual periods ending after
December 15, 2002. The initial recognition and initial measurement provisions of this interpretation are applicable on a prospective basis to guarantees issued or modified after
December 31, 2002, irrespective of the guarantor's fiscal year-end. The adoption of this interpretation did not have a material impact on the Company's consolidated financial
position or results of operations.

---

In
January 2003, the FASB issued FASB Interpretation No. 46 (revised December 2003),Consolidation of Variable Interest
Entities, which addresses how a business enterprise should evaluate whether it has a controlling financial interest in an entity through means other than voting rights and
accordingly should consolidate the entity. FIN 46R replaces FASB Interpretation No. 46,Consolidation of Variable InterestEntities, which was
issued in January 2003. The Company will be required to apply FIN 46R to variable interests in VIEs created after December 31, 2003. For variable interests in VIEs created before
January 1, 2004, the Interpretation will be applied beginning on January 1, 2005. For any VIEs that must be consolidated under FIN 46R that were created before January 1, 2004,
the assets, liabilities and noncontrolling interests of the VIE initially would be measured at their carrying amounts with any difference between the net amount added to the balance sheet and any
previously recognized interest being recognized as the cumulative effect of an accounting change. If determining the carrying amounts is not practicable, fair value at the date FIN 46R first applies
may be used to measure the assets, liabilities and non-controlling interest of the VIE. Certain new disclosure requirements apply to all financial statements issued after
January 31, 2003. The adoption of this interpretation is not expected to have a material impact on the Company's consolidated financial position or results of operations.

In
November of 2002, the EITF reached a consensus on Issue No. 02-16, "Accounting by a Customer (Including a Reseller) for Certain Consideration Received from a
Vendor" ("EITF 02-16"). EITF 02-16 addresses the accounting for cash consideration given to a reseller of a vendor's products from a vendor. EITF 02-16 indicates
that cash consideration received by a customer from a vendor is presumed to be a reduction in the price of the vendor's products or services and should, therefore, be characterized as a reduction of
cost of sales when recognized in the customer's income statement. The EITF indicated that such presumption is overcome when the consideration is either (a) a reimbursement of costs incurred by
the customer to sell the vendor's products, in which case the cash consideration should be characterized as a reduction of that cost when recognized in the customer's income statement, or (b) a
payment for assets or services delivered to the vendor, in which case the cash consideration should be characterized as revenue when recognized in the customer's income statement. The EITF also
reached a consensus that a rebate or refund of a specified amount of cash consideration that is payable only if the customer completes a
specified cumulative level of purchases or remains a customer for a specified time period should be recognized as a reduction of the cost of sales based on a systematic and rational allocation of the
cash consideration offered to each of the underlying transactions that results in progress by the customer toward earning the rebate or refund, provided the amounts are reasonably estimable. On
December 27, 2002, the Company adopted EITF 02-16, effective with arrangements entered into or after November 21, 2002. Such adoption did not have a material impact on the
Company's consolidated financial position or results of operations.

In
May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity." This Statement establishes
standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. SFAS No. 150 requires certain financial instruments that
embody obligations of the issuer and have characteristics of both liabilities and equity to be classified as liabilities. Many of these instruments previously were classified as equity or temporary
equity and as such, SFAS No. 150 represents a significant change in practice in the accounting for a number of mandatorily redeemable equity instruments and certain equity derivatives that
frequently are used in connection with share repurchase programs. SFAS No. 150 is effective for all financial instruments created or modified after May 31, 2003, and to other instruments
at the beginning of the first interim period beginning after June 15, 2003. The Company's adoption of SFAS No. 150 did not have a material impact on its consolidated financial position,
cash flows or results of operations.

---

3. FORMATION OF REGAL ENTERTAINMENT GROUP

Exchange Transaction

The Company became a wholly owned subsidiary of REG on April 12, 2002 in conjunction with an exchange transaction in which REG, through its wholly owned
subsidiary Regal Entertainment Holdings, Inc. ("REH"), also acquired Edwards, United Artists Theatre Company (including its subsidiary United Artists Theatre Circuit, Inc.) ("UATC") and
RCM. REG is controlled by Anschutz, which controlled each of us, Edwards, United Artists Theatre Company and RCM prior to REG's acquisition of us and them in the exchange transaction. Following the
exchange transaction, RCI acquired Edwards, RCM, Hoyts and UATG from REH in a series of transactions discussed in Note 4"Acquisitions" below.

Initial Public Offering of REG

In May 2002, REG issued 18.0 million shares of its Class A common stock in an initial public offering at a price of $19.00 per share,
receiving aggregate net offering proceeds, net of underwriting discounts, commissions and other offering expenses, of $314.8 million.

4. ACQUISITIONS



On June 6, 2003, RCI acquired all of the outstanding equity interests of UATG from REH for an estimated cash purchase price of approximately
$311.4 million. The assets of UATG consist of 438 screens in 46 leased theatres, certain fee properties and certain other assets under construction. The formation and capitalization of UATG was
effected through a series of transactions among REH, UATG, UATC and United Artists Properties I Corp. ("Prop I"). The assets used to capitalize UATG were deemed to be under the control of Anschutz,
through Anschutz's ownership of United Artists Theatre Company (the parent of UATC and Prop I), from March 2, 2001, the date that these companies emerged from bankruptcy. The Company entered
into an additional $315.0 million term loan under the third amended and restated Regal Cinemas senior credit facility to fund the purchase price of UATG. See
Note 6"Long-Term Obligations" for further description of the third amended and restated Regal Cinemas senior credit facility.

Following
the acquisition, UATG became a wholly owned subsidiary of RCI and became a guarantor under the third amended and restated Regal Cinemas senior credit facility and the Regal
Cinemas 93/8% senior subordinated notes. As a result of RCI being under common control with UATG, the transaction was accounted for as a contribution of UATG to RCI by REH, at REG's
historical cost basis of the assets of UATG, in a manner similar to a pooling of interests. Accordingly, the accompanying consolidated financial statements presented herein reflect the results of
operations of the assets of UATG from January 24, 2002, the deemed date at which Anschutz initially held common control in both RCI and the assets of UATG.

The
purchase price for the leased theatres was based on a valuation of the operations of the leased theatres on an ongoing basis and the purchase price for the owned theatre properties
was based on the appraised value for such properties. The amounts initially recorded based on the acquisition of UATG by the Company were current assets ($7.8 million), property and equipment
($120.0 million), deferred tax assets ($77.3 million), goodwill ($56.3 million), other assets ($1.6 million), current liabilities ($6.8 million), other liabilities
($3.6 million) and excess purchase price recorded in additional paid-in capital ($58.8 million).

---



On March 28, 2003, RCI acquired all of the outstanding capital stock of Hoyts from REG for a purchase price of approximately $213.1 million. The
purchase price included cash of approximately $188.1 million and the assumption of certain capital lease and other obligations with an aggregate fair value of approximately
$25.0 million. Hoyts is comprised of a total of 50 theatres and 534 screens located in 10 states in the Northeastern United States.

Following
the acquisition, Hoyts became a wholly owned subsidiary of RCI and became a guarantor under the third amended and restated Regal Cinemas senior credit facility and the Regal
Cinemas 93/8% senior subordinated notes. As a result of RCI being under common control with Hoyts, the transaction was accounted for as a contribution of Hoyts to RCI by REG, at REG's
historical cost basis of Hoyts, in a manner similar to a pooling of interests. Accordingly, the consolidated statements of operations presented herein reflect the results of operations of Hoyts from
March 28, 2003.

The
following is a summary of the initial allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: current
assets ($1.1 million), buildings, leasehold improvements and equipment ($200.2 million), goodwill ($0.9 million), deferred income tax asset ($33.0 million), other assets
($0.2 million), current liabilities ($22.0 million), and other liabilities ($0.3 million).

The
following unaudited pro forma results of operations assume the Hoyts acquisition occurred as of the beginning of fiscal 2002. The pro forma results have been prepared for comparative
purposes only and do not purport to indicate the results of operations which would actually have occurred had the combination been in effect on the date indicated, or which may occur in the future.

Fifty-three weeks ended
January 1, 2004
(Reorganized Company)

Forty-eight weeks ended
December 26, 2002
(Reorganized Company)

Four weeks ended
January 24, 2002
(Predecessor Company)Revenues

$
2,202.5

$
1,937.1

$
123.5Operating income


361.6


294.8


24.1Net income


178.4


142.4


422.1




On November 28, 2002, RCI acquired all of the outstanding capital stock of RCM from REH for a purchase price of approximately $4.2 million.
Following the acquisition, RCM became a majority-owned subsidiary of RCI and became a guarantor under the third amended and restated Regal Cinemas senior credit facility and the Regal Cinemas
93/8% senior subordinated notes. As a result of RCI being under common control with RCM, the transaction was accounted for as a contribution of RCM to RCI by REH, at REG's historical
cost basis of RCM, in a manner similar to a pooling of interests. Accordingly, the accompanying consolidated financial statements presented herein reflect the results of operations of RCM from
February 21, 2002, the deemed date at which Anschutz initially held common control in both RCI and RCM.



On April 17, 2002, RCI acquired all of the outstanding capital stock of Edwards from REH for an aggregate purchase price of approximately
$272.5 million, of which $238.0 million was contributed to Edwards. Following the acquisition, Edwards became a wholly owned subsidiary of RCI. As a result of RCI being under common
control with Edwards, the transaction was accounted for as a contribution of

---

Edwards
to RCI by REH, at REG's historical cost basis of Edwards, in a manner similar to a pooling of interests. Accordingly, the accompanying consolidated financial statements presented herein
reflect the results of operations of Edwards from January 24, 2002, the deemed date at which Anschutz initially held common control in both RCI and Edwards.

In
connection with the acquisition of Edwards, Regal Cinemas issued $150 million principal amount of 93/8% senior subordinated notes due 2012 under the indenture
pursuant to which Regal Cinemas sold $200 million principal amount of 93/8% senior subordinated notes due 2012 in January 2002. The proceeds of the notes issued on
April 17, 2002, together with cash on hand at RCI and Edwards, were used by RCI to acquire Edwards from REH. REH used the proceeds from its sale of Edwards to RCI to repay approximately
$180.7 million of senior bank debt, including accrued interest of Edwards, to redeem approximately $12.0 million of Edwards Subordinated Notes, including accrued interest, primarily held
by Anschutz and OCM Principal Opportunities Fund II, L.P. ("Oaktree's Principal Activities Group"), and to redeem approximately $75.3 million of redeemable preferred stock of Edwards held by
Anschutz, Oaktree's Principal Activities Group, Ms. Carole Ann Ruoff and Ms. Joan Edwards Randolph, both former stockholders of Edwards, and from Edwards Affiliated Holdings, LLC, a
company controlled by Mr. W. James Edwards, III, another former stockholder of Edwards. The difference between the carrying amount and redemption price of the redeemable preferred stock of
$28.2 million was recorded as a charge to equity. In addition, the Company recorded a loss on extinguishment of debt of approximately $1.3 million, as a result of the early redemption of
the Edwards Subordinated Notes.

The
amounts initially recorded based on the acquisition of Edwards by the Company were current assets ($80.4 million), property and equipment ($293.0 million), other assets
($61.7 million), debt obligations ($190.3 million), other liabilities ($113.5 million) and redeemable preferred stock ($47.1 million).

5. REORGANIZATION

In connection with the emergence from bankruptcy and acquisition of a controlling equity interest by Anschutz, the Company made certain adjustments in accordance
with SOP 90-7 to reflect RCI's emergence from bankruptcy and simultaneously allocated Anschutz's predecessor cost basis to the Company's remaining assets and liabilities. The most
significant of these adjustments related to the discharge of certain RCI debt obligations and certain other liabilities subject to compromise, the issuance of RCI's new senior credit facilities and
senior subordinated notes, and basis adjustments to certain assets and liabilities to reflect the combined historical cost basis of Anschutz. Additionally, the Company's previously authorized
preferred stock (none issued) and previously authorized and issued common stock were cancelled upon emergence from bankruptcy. Such adjustments will have a significant effect on the Company's future
statements of operations.

---

The
effects of the reorganization and purchase accounting adjustments on the Company's balance sheet as of January 24, 2002 are as follows (in millions):

|                                               |                                           | Predecessor
Company
January 24, 2002                 |   | Discharge of Debt(a) |         | Purchase Accounting
and Reorganization
Adjustments(b) |          | Reorganized
Company
January 24, 2002
|---------------------------------------------- | ----------------------------------------- | ---------------------------------------------------- | - | -------------------- | ------- | ----------------------------------------------------- | -------- | ------------------------------------
|ASSETS                                         |                                           |                                                      |   |                      |         |                                                       |          |                                     
|Current assets:                                |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               | Cash and equivalents                      |                                                      | $ | 286.7                |         | $                                                     | (120.0   | )                                   
|                                               | Accounts receivable                       |                                                      |   | 1.3                  |         |                                                       |         |                                     
|                                               | Construction receivables                  |                                                      |   | 1.8                  |         |                                                       |         |                                     
|                                               | Inventories                               |                                                      |   | 3.3                  |         |                                                       |         |                                     
|                                               | Prepaid and other current assets          |                                                      |   | 16.0                 |         |                                                       |         |                                     
|                                               | Assets held for sale                      |                                                      |   | 5.9                  |         |                                                       |         |                                     
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               |                                           | Total current assets                                 |   |                      | 315.0   |                                                       |          | (120.0                              
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|Property and equipment:                        |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               | Land                                      |                                                      |   | 80.4                 |         |                                                       |         |                                     
|                                               | Buildings and leasehold improvements      |                                                      |   | 1,014.1              |         |                                                       |         |                                     
|                                               | Equipment                                 |                                                      |   | 427.1                |         |                                                       |         |                                     
|                                               | Construction in progress                  |                                                      |   | 3.5                  |         |                                                       |         |                                     
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               |                                           | Total property and equipment                         |   |                      | 1,525.1 |                                                       |          |                                    
|                                               | Accumulated depreciation and amortization |                                                      |   | (303.5               | )       |                                                       |         |                                     
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               |                                           | Total property and equipment, net                    |   |                      | 1,221.6 |                                                       |          |                                    
|                                               | Goodwill                                  |                                                      |   | 336.2                |         |                                                       |         |                                     
|                                               | Other assets                              |                                                      |   | 41.0                 |         |                                                       | (12.8    | )                                   
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               |                                           | Total assets                                         |   | $                    | 1,913.8 |                                                       | $        | (132.8                              
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) |                                           |                                                      |   |                      |         |                                                       |          |                                     
|Current liabilities:                           |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               | Current maturities of long-term debt      |                                                      |   | 2.2                  |         |                                                       | 13.5     |                                     
|                                               | Accounts payable                          |                                                      |   | 47.3                 |         |                                                       |         |                                     
|                                               | Accrued expenses                          |                                                      |   | 72.1                 |         |                                                       | (2.9     | )                                   
|                                               | Deferred income tax liability             |                                                      |   |                     |         |                                                       | 0.6      |                                     
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               | Total current liabilities                 |                                                      |   | 121.6                |         |                                                       | 11.2     |                                     
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               | Long-term debt, less current maturities   |                                                      |   | 3.2                  |         |                                                       | 456.5    |                                     
|                                               | Capital leases, less current maturities   |                                                      |   | 1.5                  |         |                                                       |         |                                     
|                                               | Lease financing arrangements              |                                                      |   | 97.7                 |         |                                                       |         |                                     
|                                               | Other liabilities                         |                                                      |   | 23.9                 |         |                                                       | (1.9     | )                                   
|                                               | Deferred income tax liability             |                                                      |   |                     |         |                                                       | 33.7     |                                     
|                                               | Liabilities subject to compromise         |                                                      |   | 2,094.3              |         |                                                       | (2,019.7 | )                                   
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               | Total liabilities                         |                                                      |   | 2,342.2              |         |                                                       | (1,520.2 | )                                   
|Shareholders' equity (deficit):                |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               | Common stock                              |                                                      |   | 196.5                |         |                                                       | 725.4    |                                     
|                                               | Additional paid-in capital                |                                                      |   |                     |         |                                                       |         |                                     
|                                               | Retained deficit                          |                                                      |   | (624.9               | )       |                                                       | 661.9    |                                     
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               | Total shareholders' equity (deficit)      |                                                      |   | (428.4               | )       |                                                       | 1,387.4  |                                     
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     
|                                               |                                           | Total liabilities and shareholders' equity (deficit) |   | $                    | 1,913.8 |                                                       | $        | (132.8                              
|                                               |                                           |                                                      |   |                      |         |                                                       |          |                                     

---

---



6. LONG-TERM OBLIGATIONS

Long-term obligations at January 1, 2004 and December 26, 2002 consist of the following (in millions):

|                                                                                   |                                  | (Reorganized
Company)
January 1, 2004 |       | (Reorganized
Company)
December 26, 2002 |  
|---------------------------------------------------------------------------------- | -------------------------------- | ------------------------------------- | ----- | --------------------------------------- | -
|Regal Cinemas Senior Credit Facility                                               |                                  | $                                     | 509.6 |                                         | $
|Regal Cinemas 93/8% Senior Subordinated Notes                                      |                                  |                                       | 350.0 |                                         |  
|Capital lease obligations, 7.9%, maturing in 2009                                  |                                  |                                       | 23.0  |                                         |  
|Lease financing arrangements, 11.5%, maturing in various installments through 2021 |                                  |                                       | 96.0  |                                         |  
|Other                                                                              |                                  |                                       | 2.7   |                                         |  
|                                                                                   |                                  |                                       |       |                                         |  
|Total long-term obligations                                                        |                                  |                                       | 981.3 |                                         |  
|Less current maturities                                                            |                                  |                                       | (30.6 | )                                       |  
|                                                                                   |                                  |                                       |       |                                         |  
|                                                                                   | Total long-term obligations, net |                                       | $     | 950.7                                   |  
|                                                                                   |                                  |                                       |       |                                         |  

Amended and Restated Regal Cinemas Senior Credit FacilityOn August 27, 2003, Regal Cinemas
entered into a new term loan facility ("New Term Loan D") under the third amended and restated credit agreement of Regal Cinemas for approximately $523.1 million to refinance, at a more
favorable interest rate, the aggregate outstanding principal amount under the former Term Loan C and Term Loan D facilities. The amortization schedule under the New Term Loan D is equal to the sum of
the scheduled quarterly amortization payments under the former Term Loan C and Term Loan D facilities. The New Term Loan D facility amortizes at a rate of 5.2% per annum for the first three years of
the loan, with the remaining 84.4% of principal becoming due in years four through six of the loan, maturing June 30, 2009. The New Term Loan D facility is guaranteed by substantially all
direct and indirect subsidiaries of Regal Cinemas and by substantially all real and personal property of Regal Cinemas and its subsidiaries, as set forth in the third amended and restated credit
agreement. The third amended and restated credit agreement carries identical covenants to those in the Regal Cinemas credit agreement that was amended and restated. As of January 1, 2004, Regal
Cinemas had $145 million available under its undrawn senior revolving credit facility. Regal Cinemas also maintains letters of credit of $30 million (of which approximately
$15.9 million was outstanding as of January 1, 2004), which reduces the availability under its senior revolving credit facility.

Borrowings
under the term facility bear interest, at Regal Cinemas' option, at either the base rate or Eurodollar rate plus, in each case, an applicable margin, subject to adjustment
based upon the consolidated total leverage ratio of Regal Cinemas. The base rate is a fluctuating interest rate equal to the higher of (a) the British Banking Association's prime rate or
(b) the Federal Funds Effective Rate plus 0.5%. At January 1, 2004, the interest rate on the amended and restated senior secured credit facility was approximately 3.7%.

Regal
Cinemas may prepay borrowings under the third amended and restated senior credit facility in whole or in part, in minimum amounts and subject to other conditions set forth in the
third amended and restated senior credit agreement. Regal Cinemas is required to make mandatory prepayments to the lenders from the net cash proceeds from asset sales and new debt issuances, in
particular circumstances specified in the third amended and restated senior credit agreement.

Regal
Cinemas' obligations are secured by, among other things, the capital stock of most of its subsidiaries, mortgages on most of its properties and a security interest in substantially
all of its assets.

The
third amended and restated senior credit agreement includes various financial covenants such as certain leverage and coverage ratios. The third amended and restated senior credit
agreement also

---

contains
customary covenants, including limitations on Regal Cinemas' ability to incur debt, and events of default, including a change of control, as defined in the third amended and restated senior
credit agreement. The third amended and restated senior credit agreement also limits Regal Cinemas' ability to pay dividends, to make advances and otherwise to engage in intercompany transactions.

Regal Cinemas Senior Subordinated NotesOn January 29, 2002, Regal Cinemas issued
$200.0 million aggregate principal amount of 93/8% senior subordinated notes due 2012. Interest on the notes is payable semi-annually on February 1 and
August 1 of each year, and the notes mature on February 1, 2012. The notes are jointly and severally, fully and unconditionally guaranteed by most of Regal Cinemas' existing wholly owned
subsidiaries and are unsecured, ranking behind Regal Cinemas' obligations under its senior credit facility and any future senior indebtedness.

As
described in Note 4"Acquisitions," on April 17, 2002, Regal Cinemas sold $150 million principal amount of 93/8% senior subordinated
notes due 2012, which were issued under the indenture pursuant to which Regal Cinemas sold the $200 million principal amount of 93/8% senior subordinated notes due 2012 in
January 2002.

Regal
Cinemas has the option to redeem the notes, in whole or in part, at any time on or after February 1, 2007 at redemption prices declining from 104.688% of their principal
amount on February 1, 2007 to 100% of their principal amount on or after February 1, 2010, plus accrued interest. At any time on or prior to February 1, 2005, Regal Cinemas may
also redeem up to 35% of the aggregate principal amount of the notes at a redemption price of 109.375% of their principal amount, plus accrued interest, within 90 days of an underwritten public
offering of common stock of Regal Cinemas or of a future underwritten public offering of Regal Cinemas' common stock, the proceeds of which are used as a contribution to the equity of Regal Cinemas.
Upon a change of control, as defined in the indenture pursuant to which the notes were issued, Regal Cinemas is required to offer to purchase the notes at a purchase price equal to 101% of their
principal amount, plus accrued interest. In addition, the indenture limits Regal Cinemas' and its subsidiaries' ability to, among other things, incur additional indebtedness and pay dividends on or
repurchase capital stock.

In
May 2002, Regal Cinemas filed a registration statement under the Securities Act of 1933 pursuant to a registration rights agreement entered into in connection with the
93/8% senior subordinated notes offerings. Under the registration rights agreement, the Company was required to register for exchange under the Securities Act of 1933 identical
93/8% senior subordinated notes due 2012 to replace the outstanding 93/8% senior subordinated notes due 2012, which were issued in January and April 2002 without
registration under the Securities Act of 1933 pursuant to exemptions from registration available thereunder. The Securities and Exchange Commission declared the registration statement relating to the
exchange offer effective on July 10, 2002, and the exchange of the registered 93/8% senior subordinated notes due 2012 for the unregistered 93/8% senior
subordinated notes due 2012 was
consummated on August 14, 2002. Regal Cinemas did not receive any proceeds from the exchange offer transaction.

Each
subsidiary guarantor of Regal Cinemas' senior subordinated notes is exempt from reporting under the Securities Exchange Act of 1934 pursuant to Rule 12h-5 under
the Exchange Act, as Regal Cinemas has no independent assets or operations, the guarantees of Regal Cinemas' subsidiary guarantors are full and unconditional and joint and several, and any
subsidiaries of Regal Cinemas other than the subsidiary guarantors are, individually and in the aggregate, minor. There are no significant restrictions on Regal Cinemas' ability or any subsidiary
guarantor to obtain funds from its subsidiaries.

Lease Financing ArrangementsThese obligations primarily represent capitalized lease obligations
resulting from the requirements of Emerging Issues Task Force (EITF) Issue No. 97-10,The Effect of Lessee Involvement in Asset
Construction,released in fiscal 1998.

---

Interest Rate SwapsIn September 1998, RCI entered into interest rate swap agreements for
five-year terms to hedge a portion of its senior credit facilities variable interest rate risk. In September 2000, RCI monetized the value of these agreements for approximately
$8.6 million. Prior to its emergence from bankruptcy, RCI had deferred the gain realized from the sale and was amortizing the gain as a credit to interest expense over the remaining original
term of these swaps (through September 2003). Upon emergence from bankruptcy, the related unamortized deferred gain of $3.9 million was eliminated.

Gain on Debt ExtinguishmentAs a result of the Company's debt restructuring in connection with its
Chapter 11 bankruptcy proceedings discussed more fully in Notes 1 and 8, the Company recorded a gain on debt extinguishment of $661.9 million for the four weeks ended January 24, 2002.
During 2001, the Company entered into agreements with certain of its landlords that resulted in the termination of certain leases, including eight which were accounted for as either capital leases or
lease financing arrangements. Accordingly, the Company wrote-off the related debt obligations and net book value of the related property and equipment and other assets. During 2001, the
Company also entered into lease modifications of certain lease financing arrangements which provided for a reduction of the total lease payments. In conjunction with these terminations and
modifications the Company made payments of approximately $5.8 million, which, after the write-off of the related assets and liabilities, resulted in a gain on debt extinguishment of
$21.7 million for the year ended December 27, 2001.

Contractual InterestContractual interest not accrued or recorded on certain pre-petition
debt totaled approximately $15.8 million for the year ended December 27, 2001.

Maturities of Long-Term ObligationsThe Company's long-term debt, capital
lease obligations, and lease financing arrangements are scheduled to mature as follows:

|           |  | Long-Term
Debt and Other |       | Capital
Leases |   | Lease
Financing
Arrangements |  | Total
|---------- |  | ------------------------ | ----- | -------------- | - | ---------------------------- |  | -----
|
|2004       |  | $                        | 27.6  |                | $ | 0.8                          |  | $    
|2005       |  |                          | 27.7  |                |   | 0.9                          |  |      
|2006       |  |                          | 27.5  |                |   | 1.0                          |  |      
|2007       |  |                          | 145.2 |                |   | 1.6                          |  |      
|2008       |  |                          | 113.2 |                |   | 1.5                          |  |      
|Thereafter |  |                          | 521.1 |                |   | 17.2                         |  |      
|           |  |                          |       |                |   |                              |  |      
|           |  | $                        | 862.3 |                | $ | 23.0                         |  | $    
|           |  |                          |       |                |   |                              |  |      

7. INCOME TAXES

The components of the provision for (benefit from) income taxes for income from continuing operations for each of the three fiscal years were as follows (in
millions):

|                                                    |  | Reorganized
Company for the
fifty-three weeks ended
January 1, 2004 |       | Reorganized
Company for the
forty-eight weeks ended
December 26, 2002 |   | Predecessor
Company for the
four weeks ended
January 24, 2002 |  | Predecessor
Company as of
December 27, 2001 |     
|--------------------------------------------------- |  | ------------------------------------------------------------------- | ----- | --------------------------------------------------------------------- | - | ------------------------------------------------------------- |  | ------------------------------------------- | ----
|Current                                             |  | $                                                                   | 105.8 |                                                                       | $ | 16.8                                                          |  | $                                           |    
|Deferred                                            |  |                                                                     | 8.7   |                                                                       |   | 68.0                                                          |  |                                             |    
|Increase in deferred income tax valuation allowance |  |                                                                     |      |                                                                       |   |                                                              |  |                                             | 50.9
|                                                    |  |                                                                     |       |                                                                       |   |                                                               |  |                                             |     
|Total income tax provision                          |  | $                                                                   | 114.5 |                                                                       | $ | 84.8                                                          |  | $                                           |    
|                                                    |  |                                                                     |       |                                                                       |   |                                                               |  |                                             |     

---

A
reconciliation of the provision for (benefit from) income taxes as reported and the amount computed by multiplying the income before taxes and extraordinary item by the U.S. federal
statutory rate of 35% was as follows (in millions):

|                                                                    |  | Reorganized
Company for the
fifty-three weeks ended
January 1, 2004 |       | Reorganized
Company for the
forty-eight weeks ended
December 26, 2002 |   | Predecessor
Company
for the four weeks ended
January 24, 2002 |  | Predecessor
Company as of
December 27, 2001 |       
|------------------------------------------------------------------- |  | ------------------------------------------------------------------- | ----- | --------------------------------------------------------------------- | - | ------------------------------------------------------------- |  | ------------------------------------------- | ------
|Provision (benefit) calculated at federal statutory income tax rate |  | $                                                                   | 101.4 |                                                                       | $ | 73.9                                                          |  | $                                           | 147.3 
|State and local income taxes, net of federal benefit                |  |                                                                     | 13.1  |                                                                       |   | 10.0                                                          |  |                                             | 35.7  
|Fresh start adjustments                                             |  |                                                                     |      |                                                                       |   |                                                              |  |                                             | 332.3 
|Reorganization costs                                                |  |                                                                     |      |                                                                       |   | 0.4                                                           |  |                                             | 7.6   
|Cancellation of debt income                                         |  |                                                                     |      |                                                                       |   |                                                              |  |                                             | (289.2
|Goodwill amortization                                               |  |                                                                     |      |                                                                       |   |                                                              |  |                                             |      
|Goodwill impairment                                                 |  |                                                                     |      |                                                                       |   |                                                              |  |                                             |      
|Change in valuation allowance                                       |  |                                                                     |      |                                                                       |   |                                                              |  |                                             | (233.7
|Other                                                               |  |                                                                     |      |                                                                       |   | 0.5                                                           |  |                                             |      
|                                                                    |  |                                                                     |       |                                                                       |   |                                                               |  |                                             |       
|Total income tax provision                                          |  | $                                                                   | 114.5 |                                                                       | $ | 84.8                                                          |  | $                                           |      
|                                                                    |  |                                                                     |       |                                                                       |   |                                                               |  |                                             |       

---

Significant
components of the Company's net deferred tax asset (liability) consisted of the following at:

|                          |                                                          | Reorganized
Company as of
January 1, 2004            |                                    | Reorganized
Company as of
December 26, 2002 |      
|------------------------- | -------------------------------------------------------- | ---------------------------------------------------- | ---------------------------------- | ------------------------------------------- | -----
|
|Deferred tax assets:      |                                                          |                                                      |                                    |                                             |      
|                          | Excess of tax basis over book basis of intangible assets |                                                      | $                                  | 36.3                                        |      
|                          | Deferred rent                                            |                                                      |                                    | 19.3                                        |      
|                          | Bankruptcy related liabilities                           |                                                      |                                    | 1.4                                         |      
|                          | Accrued Expenses                                         |                                                      |                                    | 1.7                                         |      
|                          | Net operating loss carryforward                          |                                                      |                                    | 56.9                                        |      
|                          | Deferred revenue                                         |                                                      |                                    | 1.2                                         |      
|                          | Deferred gain related to UATG asset purchase             |                                                      |                                    |                                            |      
|                          | Other                                                    |                                                      |                                    | 2.0                                         |      
|                          |                                                          |                                                      |                                    |                                             |      
|                          |                                                          | Total deferred tax assets before valuation allowance |                                    |                                             | 118.8
|                          |                                                          | Valuation allowance                                  |                                    |                                             | (19.9
|                          |                                                          |                                                      |                                    |                                             |      
|                          |                                                          | Total deferred tax assets after valuation allowance: |                                    |                                             | 98.9 
|Deferred tax liabilities: |                                                          |                                                      |                                    |                                             |      
|                          | Excess of book basis over tax basis of fixed assets      |                                                      |                                    | (29.1                                       | )    
|                          | Other                                                    |                                                      |                                    | (0.9                                        | )    
|                          |                                                          |                                                      |                                    |                                             |      
|                          |                                                          | Total deferred tax liabilities                       |                                    |                                             | (30.0
|                          |                                                          |                                                      | Net deferred tax asset/(liability) |                                             | $    
|                          |                                                          |                                                      |                                    |                                             |      

At
January 1, 2004, the Company has net operating loss carryforwards for federal income tax purposes of approximately $161.0 million expiring through 2021. The Company's
net operating loss carryforwards were generated by the entities of Edwards and Hoyts. The Tax Reform Act of 1986 imposed substantial restrictions on the utilization of net operating losses in the
event of an "ownership change" of a corporation. Accordingly, the Company's ability to utilize the net operating losses acquired from Edwards and Hoyts may be impaired as a result of the "ownership
change" limitations.

In
assessing the realizable value of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be
realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which these temporary differences become deductible. The
Company has recorded a valuation allowance against deferred tax assets at January 1, 2004 and December 26, 2002, totaling $19.9 million and $5.1 million, respectively, as
management believed it more likely than not that the deferred tax asset would not be realized in future tax periods. The valuation allowance at January 1, 2004 relates to
pre-acquisition deferred tax assets of Edwards and Hoyts. Accordingly, future reductions in the valuation allowance will reduce goodwill related to the acquisition of Edwards and Hoyts.

For
federal income tax purposes, the Company has carryover tax basis in certain assets acquired in the Hoyts acquisition described in Note 4. Such acquired entities had net
operating loss carryforwards totaling approximately $155.4 million as of the date of acquisition. Pursuant to certain IRS limitations, the Company's allowable annual deduction with respect to
the Hoyts net operating loss carryforwards is limited to approximately $8.6 million. During the quarter ended June 26, 2003, the Company recorded deferred tax assets in the amount of
approximately $33.0 million, net of a valuation allowance of approximately $14.8 million, in connection with the Hoyts acquisition.

---

8. COMMITMENTS AND CONTINGENCIES



The Company accounts for a majority of its leases as operating leases. The Company, at its option, can renew a substantial portion of the leases at defined or
then fair rental rates for various periods. Certain leases for Company theatres provide for contingent rentals based on the revenue results of the underlying theatre and require the payment of taxes,
insurance, and other costs applicable to the property. Also, certain leases contain escalating minimum rental provisions that have been accounted for on a straight-line basis over the
initial term of the leases. Minimum rentals payable under all non-cancelable operating leases with terms in excess of one year as of January 1, 2004, are summarized for the
following fiscal years:

(In millions)2004

$
206.62005


205.32006


203.52007


203.92008


204.5Thereafter


2,072.0


Rent
expense (including straight-line rent) under such operating leases amounted to $227.6 million, $185.6 million, $10.5 million, and $136.2 million for the
fifty-three weeks ended January 1, 2004, the forty-eight weeks ended December 26, 2002, the four weeks ended January 24, 2002, and fiscal year 2001, respectively. Contingent rent
expense was $17.3 million, $11.6 million, $0.4 million, and $4.3 million for the fifty-three weeks ended January 1, 2004, the forty-eight weeks ended
December 26, 2002, the four weeks ended January 24, 2002, and fiscal year 2001, respectively.



As discussed in Note 1 above, RCI emerged from bankruptcy on January 29, 2002. On August 23, 2000, Edwards and its subsidiaries at that time
also filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code in the United States Bankruptcy Court for the Central District of California (the "California
Bankruptcy Court"). On May 24, 2001, Edwards filed a plan of reorganization and related disclosure statement, as subsequently amended on July 23, 2001 (the "Edwards Plan"). On
September 24, 2001, the California Bankruptcy Court confirmed the Edwards Plan. On September 29, 2001, all conditions required for the effectiveness of the Edwards Plan were met, and the
Edwards Plan became effective. Pursuant to the Edwards Plan, Anschutz and Oaktree's Principal Activities Group agreed to exchange approximately $14.6 million of their pre-petition
secured claims and cash of $41.4 million for $56.0 million in Edwards' Series A preferred stock and 51% of Edwards' newly-issued common stock and $10.0 million of senior
secured debt for $10.0 million of senior unsecured subordinated notes (the "Edwards Subordinated Notes").

The
Edwards Plan also provided that Edwards' senior secured lenders receive a pay-down of $9.5 million of principal and all pre-petition and
post-petition accrued and unpaid interest at the applicable non-default rate. In connection with the Edwards Plan, the Edwards Subordinated Notes were issued and the existing
secured lenders established a $180.0 million restructured term loan. General unsecured creditors were entitled to receive, at their option, either a cash distribution equal to 90% of the
holder's allowed claim or an unsecured seven year note equal to 100% of the allowed claim. The seven year notes provide for semi-annual interest payments, in arrears, beginning on the
six-month anniversary of the effective date at a rate of 9% per annum, compounded annually. The notes also require semi-annual principal reduction payments beginning on the
six-month anniversary of the Edwards effective date (September 29, 2001).

---

RCI
and Edwards have bankruptcy claims that remain unsettled and are subject to ongoing negotiation and possible litigation. At January 1, 2004, approximately $3.5 million
of remaining claims related to RCI's and Edwards' bankruptcy proceedings are recorded in the Company's January 1, 2004 consolidated balance sheet as "Bankruptcy Related Liabilities and Claims."
In the opinion of
management, based on its examination of these matters, its experience to date and discussions with legal counsel, the outcome of these legal matters, after taking into consideration the amounts
already accrued, is not expected to have a material effect on the Company's liquidity or results of operations. To the extent claims are allowed by the Bankruptcy Court, they will be funded with cash
on hand, cash flow from operations or borrowings under Regal Cinemas' revolving credit facility.



RCI and Edwards are defendants in a number of claims arising from their decision to file voluntary petitions for bankruptcy relief and to close theatre locations
or to cease construction of theatres on sites for which such entities had contractual obligations to lease such property. The Company and its subsidiaries are also presently involved in various legal
proceedings arising in the ordinary course of its business operations, including personal injury claims, employment and contractual matters and other disputes. The Company believes it has adequately
provided for the settlement of such matters. Management believes any additional liability with respect to the above proceedings will not be material in the aggregate to the Company's consolidated
financial position, results of operations or cash flows.

Our
theatres must comply with Title III of the ADA to the extent that such properties are "public accommodations" and/or "commercial facilities" as defined by 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, an award of damages to private litigants and additional capital expenditures to remedy such non-compliance. United Artists and several of its subsidiaries and UATG are
subject to a consent decree arising from a lawsuit captioned Connie Arnold et. al. v. United Artists Theatre Circuit, Inc. et. al. The plaintiffs alleged nationwide violations with the ADA for
failure to remove barriers to access at existing theatres in a timely manner. In 1996, the parties involved in the case entered into a settlement agreement in which United Artists agreed to remove
physical barriers to access at its theatres prior to July 2001. In January 2001, the settlement agreement was amended to, among other things, extend the completion date for barrier
removal to July 2006 and require minimum expenditures of $250,000 a year for barrier removal.

On
August 13, 2003, the United States Court of Appeals for the Ninth Circuit reversed the United States District Court for the District of Oregon's award of summary judgment in
favor of our subsidiaries identified below with respect to an ADA claim on appeal before it, and remanded the case to the district court with instructions to enter summary judgment in favor of the
plaintiffs (other than Oregon Paralyzed Veterans of America, which did not join in the appeal). The lawsuit was originally filed in the district court on April 11, 2000 by the Oregon Paralyzed
Veterans of America, Kathy Stewmon, Tina Smith and Kathy Braddy against Regal Cinemas, Inc. and Eastgate Theatre Inc. dba Act III Theatre, Inc. The plaintiffs alleged, among other
things, that the "stadium seating" plans in six of the defendants' movie theatres violate the ADA and the related regulations of the Department of Justice. The appellate court did not address specific
changes, if any, that might be required to bring the stadium-style theatres into compliance with its interpretation of the ADA, and its decision conflicts with a recent decision, based upon
substantially similar facts, of the United States Court of Appeals for the Fifth Circuit captionedLara v. Cinemark USA, Inc. We believe we are in
compliance with the ADA regulation with respect to the subject theatres and as such have appealed the Ninth Circuit's decision to

---

the
Supreme Court of the United States. No decision has been made by the Supreme Court of the United States on whether or not it will hear our appeal.

We
believe that we are in substantial compliance with all current applicable regulations relating to accommodations for the disabled. We intend to comply with future regulations in this
regard, and except as set forth above, we do not currently anticipate that compliance will require us to expend substantial funds. Our theatre operations are also subject to federal, state and local
laws governing such matters as wages, working conditions, citizenship and health and sanitation requirements. We believe that we are in substantial compliance with all of such laws.

9. RELATED PARTY TRANSACTIONS

Edwards Bankruptcy Claims

Under the Edwards Plan, Anschutz and Oaktree's Principal Activities Group have agreed to contribute to Edwards $0.90 for each $1.00 of allowed general unsecured
claims in excess of $55.0 million, up to $13.5 million. For each $900 contributed, Anschutz and Oaktree's Principal Activities Group will receive $1,044, up to a maximum of $15,663,333,
from Ms. Carole Ann Ruoff and Ms. Joan Edwards Randolph, both former stockholders of Edwards, and from Edwards Affiliated Holdings, LLC, a company controlled by Mr. W. James
Edwards, another former stockholder of Edwards. REG will also acquire up
to 331,451 shares of its Class A common stock from Edwards Affiliated Holdings, LLC, based on the dollar amount contributed by Anschutz and Oaktree's Principal Activities Group. Anschutz and
Oaktree's Principal Activities Group will, in turn, receive the same number of shares from REG, and will also receive from Ms. Ruoff and Ms. Randolph an aggregate of up to $7,384,469 in
cash, in each instance based on the amount contributed and allocated between Anschutz and Oaktree's Principal Activities Group in relation to their respective contributions.

In
addition, Anschutz and Oaktree's Principal Activities Group will contribute to Edwards $0.90 for each $1.00 of allowed general unsecured claims in excess of $70.0 million. In
exchange for these contributions, REG will acquire up to 1,383,461 shares of its Class A common stock from Edwards Affiliated Holdings, LLC based on the amount contributed by Anschutz and
Oaktree's Principal Activities Group. Anschutz and Oaktree's Principal Activities Group will, in turn, receive the same number of shares from REG, and will also receive from Ms. Ruoff and
Ms. Randolph up to an aggregate of $5,935,531 in cash, in each instance based on the amount contributed and allocated between Anschutz and Oaktree's Principal Activities Group in relation to
their respective contributions.

Redemption of Edwards' Series A Preferred Stock and Series B Preferred Stock

In connection with the formation of REG, Edwards issued 135,000 shares of its Class A common stock to the holders of Edwards' Series A preferred
stock and 115,000 shares of its Class B common stock to the holders of Edwards' Series B preferred stock in consideration for the elimination of voting rights on such preferred stock.

On
April 17, 2002, REG used a portion of the proceeds from REH's sale of Edwards to RCI to cause Edwards to redeem its Series A and Series B preferred stock.
Anschutz received $47.8 million and Oaktree's Principal Activities Group received $11.9 million in the redemption of Edwards' Series A preferred stock held by them. The holders of
the Edwards Series B preferred stock received an aggregate of $15.7 million in the redemption of the Edwards Series B preferred stock held by them.

Payment of Edwards' Subordinated Notes

On April 17, 2002, REG used a portion of the proceeds from REH's sale of Edwards to RCI to cause Edwards to redeem from Anschutz and from Oaktree's
Principal Activities Group approximately

---

$9.6 million
and $2.4 million, respectively, owed on the Edwards Subordinated Notes issued by Edwards to Anschutz and Oaktree's Principal Activities Group.

Bridge Facility

During December 2001, RCI entered into a bridge facility with Anschutz and an affiliate of Oaktree's Principal Activities Group. Under the terms of the
bridge facility, RCI paid commitment fees during January 2002 of $1.6 million to Anschutz and $0.4 million to an affiliate of Oaktree's Principal Activities Group, which in the
aggregate was 1% of the total amount of available commitments under the bridge facility. This bridge facility was not drawn and terminated upon RCI's emergence from bankruptcy.

Management Agreements

RCI manages the theatre operations of UATC and its subsidiaries pursuant to the terms of a management agreement. During the fifty-three weeks ended
January 1, 2004 and the forty-eight weeks ended December 26, 2002, RCI recorded management fee revenues of approximately $10.7 million and $12.4 million respectively,
related to this arrangement. Such fees have been recorded in the accompanying consolidated statements of operations as a component of "Other Operating Revenues."

Other Transactions

During the year ended December 26, 2002, as members of the class of holders of RCI's former senior credit facilities, Anschutz, Oaktree's Principal
Activities Group and Greenwich Street Capital Partners ("GSCP"), received $33.6 million, $5.6 million and $6.0 million, respectively, in respect of accrued but unpaid interest. As
members of the class of holders of RCI's subordinated debt, Anschutz received cash payments of approximately $129.5 million, Oaktree's Principal Activities Group received cash payments of
approximately $29.7 million and GSCP received cash payments of approximately $5.5 million in satisfaction of these claims, which payments equaled approximately 20% of the principal
amount of subordinated debt held by them. Anschutz received cash payments of approximately $3.2 million, Oaktree's Principal Activities Group received cash payments of approximately
$0.8 million from REG and GSCP received cash payments from RCI of approximately $50,000 in respect of certain expenses incurred in connection with RCI's restructuring. In addition, REG paid
GSCP $1.0 million for restructuring services.

During
the fifty-three weeks ended January 1, 2004, RCM incurred approximately $2.7 million of expenses payable to an Anschutz affiliate for telecommunication services.
Additionally, RCM has recorded revenue of $0.7 million from certain affiliates of Anschutz and Oaktree's Principal Activities Group related to marketing and business meeting services provided
by RCM to these affiliates. During the year ended December 26, 2002, RCM incurred approximately $1.3 million of expenses payable to certain Anschutz affiliates for reimbursement of
travel, marketing and telecommunication expenses.

10. CAPITAL STOCK AND STOCK OPTION PLAN

As of January 1, 2004, the Company's authorized capital stock consisted of:



---



Of the authorized shares of common stock, 7,500,000 shares were outstanding as of January 1, 2004, all of which are held by REH. Of the authorized shares of the preferred stock,
no shares are issued and outstanding as of January 1, 2004. The Company may issue the preferred shares from time to time in such series having such designated preferences and rights,
qualifications and limitations as the Board of Directors may determine.

RCI 1998 Stock Purchase and Option Plan

RCI issued certain key members of management options under the 1998 Stock Purchase and Option Plan for Key Employees of RCI.

The
following table summarizes information about fixed stock options outstanding at December 27, 2001 for RCI (Predecessor Company):

Weighted
Average Exercise
Price

Options
Exercisable
At Year EndUnder option at December 28, 2000

14,803,012


3.78

9,920,444Options granted in 2001




Options exercised in 2001




Options canceled in 2001

(445,945
)

4.38Under option at December 27, 2001

14,357,067

$
3.76

11,444,711


Had
the fair value of options granted under these plans been recognized in accordance with SFAS No. 123 as compensation expense on a straight-line basis over the
vesting period of the grant, the Company's net loss would have been recorded in the amounts indicated below (in millions):

Year ended
December 27,
2001Net Loss:As Reported

$
(171.5
)Less: additional stock-based employee compensation expense determined under fair value based method for all awards, net of related tax effects


(1.6
)Pro Forma


(173.1
)


The
pro forma results do not purport to indicate the effects on reported net income for recognizing compensation expense that is expected to occur in future years. There were no options
granted in fiscal year 2001.

Pursuant
to the reorganization of RCI through the Chapter 11 Case, all of the outstanding stock options of RCI granted prior to the effective date of the Plan were cancelled effective
January 29, 2002.

REG 2002 Stock Incentive Plan

On January 29, 2002, the Company issued stock options to certain employees of Regal Cinemas. Subsequently, REG established the 2002 Stock Incentive Plan
(the "Plan") which provides for the granting of incentive stock options and non-qualified stock options to principally officers and employees of REG and its subsidiaries.

In
conjunction with the exchange transaction on April 12, 2002 (see Note 3"Formation of Regal Entertainment Group"), the holders of outstanding options of
Regal Cinemas issued in connection with

---

the
Company's emergence from bankruptcy on January 29, 2002, received replacement options to purchase 6,544,596 shares of REG Class A common stock at $8.87 per share. As a result, stock
option information presented herein prior to the exchange of options has been retroactively restated to reflect the effects of the exchange transaction. Deferred stock compensation totaling
approximately $14.3 million was recorded based on the intrinsic value of the options exchanged using the value of the exchange transaction of $11.06 per share. Ten percent of such options were
exercisable on the date of grant, another ten percent became exercisable on January 29, 2003 and the remaining options are exercisable in installments of 20% on January 29 of each
succeeding year and expire no later than 10 years from the date of grant. For the fifty-three weeks ended January 1, 2004 and the period from April 12, 2002 through
December 26, 2002, the Company recorded compensation expense of $2.7 million and $1.0 million, respectively, related to such options.

On
July 1, 2003, REG paid an extraordinary cash dividend of $5.05 per share of REG Class A and Class B common stock to stockholders of record on June 20,
2003. In connection with the extraordinary cash dividend, and pursuant to the antidilution adjustment terms of the REG 2002 Stock Incentive Plan (pursuant to which options were granted to certain
employees of Regal Cinemas), the exercise price and the number of shares subject to option held by the Company's option holders were adjusted to prevent dilution and restore their economic position to
that existing immediately before the extraordinary dividend. The antidilution adjustments made with respect to such options resulted in a decrease in the exercise price to $6.9629 per share, and an
increase in the aggregate number of shares issuable upon exercise of such options by 1,442,239. Stock option information presented herein has been adjusted to give effect to the extraordinary
dividend. There were no accounting consequences for changes made to reduce the exercise prices and increase the number of underlying shares as a result of the extraordinary cash dividend as the
(1) the aggregate intrinsic value of the awards immediately after the dividend transaction was not greater than the aggregate intrinsic value of the awards immediately before the dividend
transaction and (2) the ratio of the exercise price per share to the market value per share was not reduced.

The
following table summarizes information about REG's fixed stock options outstanding held by Regal Cinemas' employees as of January 1, 2004, as restated for the effects of the
exchange transaction:

|                                                                                                                    |  | Options
Outstanding |   | Weighted
Average Exercise
Price |        | Weighted
Average Grant
Date Fair
Value |   | Options
Exercisable
At Year
End
|------------------------------------------------------------------------------------------------------------------- |  | ------------------- | - | ------------------------------- | ------ | -------------------------------------- | - | -------------------------------
|Under option at December 27, 2001                                                                                   |  |                    |   | $                               |       |                                        |   |                                
|Options granted in 2002 at fair value                                                                               |  | 6,544,596           |   |                                 | 8.87   |                                        | $ | 4.48                           
|Options exercised in 2002                                                                                           |  | (574,163            | ) |                                 | 8.87   |                                        |   |                                
|Options canceled in 2002                                                                                            |  | (42,144             | ) |                                 | 8.87   |                                        |   |                                
|                                                                                                                    |  |                     |   |                                 |        |                                        |   |                                
|Under option at December 26, 2002                                                                                   |  | 5,928,289           |   |                                 | 8.87   |                                        |   |                                
|Options exercised in 2003                                                                                           |  | (674,400            | ) |                                 | 8.77   |                                        |   |                                
|Options cancelled in 2003                                                                                           |  | (36,518             | ) |                                 | 8.59   |                                        |   |                                
|Antidilution adjustments made to outstanding options in connection with the July 1, 2003 REG extraordinary dividend |  | 1,442,239           |   |                                 | 6.9626 |                                        |   |                                
|                                                                                                                    |  |                     |   |                                 |        |                                        |   |                                
|Under option at January 1, 2004                                                                                     |  | 6,659,610           |   |                                 | 6.9629 |                                        |   |                                

---

The
following table summarizes information about the Plan's stock options at January 1, 2004, including the weighted average remaining contractual life and weighted average
exercise price:

|Options Outstanding |  | Options Exercisable
|------------------- |  | -------------------
|
|$6.9629             |  | 6,659,610          

11.   EMPLOYEE BENEFIT PLAN

REG sponsors an employee benefit plan, the Regal Entertainment Group 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 of Regal Cinemas. The plan provides that participants may contribute up to 20% of their compensation,
subject to Internal Revenue Service limitations. The plan currently matches an amount equal to 40% of the participant's contributions up to 6% of the participant's compensation. Employee contributions
are invested in various investment funds based upon elections made by the employee.

In
conjunction with the exchange transaction in April 2002 (see Note 1"The Company and Basis of Presentation"), Regal Cinemas', United Artists' and Edwards
Theatres' management and operations were combined. Accordingly, during May 2002, United Artists transferred all plan assets (approximately $19.9 million) under the United Artists 401(k)
Savings Plan to the plan. The Company made discretionary contributions of approximately $0.9 million, $0.7 million, $0.1 million, and $0.5 million to the plan for the
fifty-three weeks ended January 1, 2004, the forty-eight weeks ended December 26, 2002, the four weeks ended January 24, 2002, and fiscal 2001, respectively.

12.   FAIR VALUE OF FINANCIAL INSTRUMENTS

The methods and assumptions used to estimate the fair value of each class of financial instrument are as follows:

Cash and cash equivalents, accounts receivable, inventory, accounts payable and accrued liabilities:

The carrying amounts approximate fair value because of the short maturity of these instruments.

Long term obligations, excluding capital lease obligations and lease financing arrangements:

The fair value of the Regal Cinemas senior credit facility, which consists of a term loan and revolving credit facility, is estimated based on quoted market
prices as of January 1, 2004. The associated interest rates are based on floating rates identified by reference to market rates and are assumed to
approximate fair value. The fair values of the Regal Cinemas Senior Subordinated Notes are estimated based on quoted market prices for these issuances as of January 1, 2004. The fair values of
Regal Cinemas other long term debt obligations were based on recent financing transactions for similar debt issuances and carrying value approximates fair value. The aggregate amounts and fair values
of long-term debt at January 1, 2004 and December 26, 2002 consist of the following:

January 1,
2004

December 26,
2002(In millions)Carrying amount

$
862.3

$
572.6Fair value

$
914.2

$
595.0


---



Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

Item 9A. CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit
to the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified by the Commission's
rules and forms, and that information is accumulated and communicated to our management, including our principal executive and principal financial officers (whom we refer to in this periodic report as
our Certifying Officers), as appropriate to allow timely decisions regarding required disclosure. Our management evaluated, with the participation of our Certifying Officers, the effectiveness of our
disclosure controls and procedures as of January 1, 2004, pursuant to Rule 13a-15(b) under the Exchange Act. Based upon that evaluation, our Certifying Officers concluded
that, as of January 1, 2004, our disclosure controls and procedures were effective.

There
were no changes in our internal control over financial reporting that occurred during our fiscal quarter ended January 1, 2004 that have materially affected, or are
reasonably likely to materially affect, our internal control over financial reporting.

PART III

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Shown below are the names, ages as of January 1, 2004, and current positions of our directors and executive officers. There are no family relationships
between any of the persons listed below, or between any of such persons and any of the directors of the Company or any persons nominated or chosen by the Company to become a director or executive
officer of the Company. Each director's term is for a period one year.

Name

Age

PositionMichael L. Campbell

50

Director and Chief Executive Officer of Regal Cinemas and Co-Chairman of the board of directors and Co-Chief Executive Officer of REGKurt C. Hall

44

Director of Regal Cinemas, Co-Chairman of the board of directors and Co-Chief Executive Officer of REG and President and Chief Executive Officer of RCMGregory W. Dunn

44

President and Chief Operating Officer of Regal Cinemas and Executive Vice President and Chief Operating Officer of REGAmy E. Miles

37

Director of Regal Cinemas and Executive Vice President, Chief Financial Officer and Treasurer of Regal Cinemas and REGPeter B. Brandow

43

Executive Vice President, General Counsel and Secretary of Regal Cinemas and REG


Michael
L. Campbell is a director and is our Chief Executive Officer and is Co-Chairman and Co-Chief Executive Officer of REG. Mr. Campbell has served as a
director of REG since March 2002. Mr. Campbell founded RCI in November 1989, and has served as Chief Executive Officer of RCI since

---

its
inception. Mr. Campbell served as a director and executive officer of RCI when it filed for bankruptcy under Chapter 11 of the United States Bankruptcy Code and throughout the bankruptcy
proceedings described in Note 1 to the consolidated financial statements included in this Form 10-K. Prior thereto, Mr. Campbell was the Chief Executive Officer of
Premiere Cinemas Corporation, which he co-founded in 1982, and served in such capacity until Premiere was sold in October 1989. Mr. Campbell is a director of REG, Eon
Streams, Inc., Fandango, Inc. and the National Association of Theatre Owners ("NATO") and serves on REG's and NATO's executive committee of the board of directors.

Kurt
C. Hall is a director of Regal Cinemas and is a director, Co-Chairman and Co-Chief Executive Officer of REG and, President and Chief Executive Officer of
RCM. Mr. Hall has served as a director of REG since March 2002 and as a director of Regal Cinemas since December 2002. Mr. Hall served as President and Chief Executive
Officer of United Artists Theatre Company from March 1998 to August 2002, and as a director from May 1992 until August 2002. Mr. Hall served as a director and
executive officer of United Artists Theatre Company when it filed for bankruptcy under Chapter 11 of the United States Bankruptcy Code and throughout the bankruptcy proceedings. Prior thereto,
Mr. Hall served as Chief Operating Officer since February 1997, and as Executive Vice President since May 12, 1992. Mr. Hall was Chief Financial Officer of United Artists,
a wholly owned subsidiary of United Artists Theatre Company, from May 1992 to March 1998. Mr. Hall is a director of REG and NATO and serves on those entities' executive committee
of the board of directors.

Gregory
W. Dunn is the President and Chief Operating Officer of Regal Cinemas, Executive Vice President and Chief Operating Officer of REG, and served as Executive Vice President and
Chief Operating Officer of RCI from 1995 to March 2002. Mr. Dunn served as an executive officer of RCI when it filed for bankruptcy under Chapter 11 of the United States Bankruptcy Code
and throughout the bankruptcy proceedings described in Note 1 to the consolidated financial statements included in this Form 10-K. Mr. Dunn served as Vice President of
Marketing and Concessions of RCI from 1991 to 1995.

Amy
E. Miles is a director and is our Executive Vice President, Chief Financial Officer and Treasurer and has served as the Executive Vice President, Chief Financial Officer and
Treasurer of RCI since January 2000. Ms. Miles has also served as the Executive Vice President, Chief Financial Officer and Treasurer of REG since March 2002 and as a director of
Regal Cinemas since December 2002. Ms. Miles served as an executive officer of RCI when it filed for bankruptcy under Chapter 11 of the United States Bankruptcy Code and throughout the
bankruptcy proceedings described in Note 1 to the consolidated financial statements included in this Form 10-K. Prior thereto, Ms. Miles served as Senior Vice
President of Finance from April 1999, when she joined RCI. Ms. Miles was a
Senior Manager with Deloitte & Touche from 1998 to 1999. From 1989 to 1998, she was with PricewaterhouseCoopers, LLC.

Peter
B. Brandow is our Executive Vice President, General Counsel and Secretary and has served as the Executive Vice President, General Counsel and Secretary of RCI since
July 2001, and prior to that time he served as Senior Vice President, General Counsel and Secretary of RCI since February 2000. Mr. Brandow has also served as the Executive Vice
President, General Counsel and Secretary of REG since March 2002. Mr. Brandow served as an executive officer of RCI when it filed for bankruptcy under Chapter 11 of the United States
Bankruptcy Code and throughout the bankruptcy proceedings described in Note 1 to the consolidated financial statements included in this Form 10-K. Mr. Brandow served
as Vice President, General Counsel and Secretary from February 1999 when he joined RCI. From September 1989 to January 1999, Mr. Brandow was an associate with the law firm
Simpson Thatcher & Bartlett.

None
of our directors, executive officers or any beneficial owner of more than 10% of our equity securities is required to file reports pursuant to Section 16(a) of the Securities
Exchange Act of 1934

---

with
respect to their relationship with us because we do not have any equity securities registered pursuant to Section 12 of the Securities Exchange Act of 1934.

Our
entire board of directors acts as our audit committee, and it has determined that Ms. Miles, as the principal financial officer of us and REG, qualifies as an "audit committee
financial expert" within the meaning of the regulations of the SEC. Ms. Miles is not "independent" under the applicable rules of the SEC.

In
accordance with the Sarbanes-Oxley Act and the applicable SEC rules, our principal executive, financial and accounting officers are subject to the REG Code of Business Conduct and
Ethics, which is applicable to all directors, officers and employees of REG and its subsidiaries, including Regal Cinemas and its subsidiaries, and includes a requirement that we make prompt
disclosure of any waiver of the code for executive officers or directors made by our board. A copy of the Code of Business Conduct and Ethics is available in print without charge to any person who
sends a request to the office of the Secretary of Regal Cinemas Corporation at 7132 Regal Lane, Knoxville, Tennessee 37918.

Item 11. EXECUTIVE COMPENSATION

The following table provides information regarding the annual, long-term and other compensation during fiscal 2003, 2002 and 2001 for our Chief
Executive Officer and our other most highly compensated executive officers who were serving as executive officers at the end of our fiscal year 2003 and whose salary and bonus exceeded $100,000 during
that year. These individuals are referred to as our Named Executive Officers. The compensation reported for the Named Executive Officers for fiscal 2003 is the compensation that they received in their
capacities as executive officers of REG, our parent. The Named Executive Officers did not receive any additional compensation from us or any other REG subsidiary during the year.

---

Summary Compensation Table

|                                                                             |  |                |  |   |                         |  |   | Long-Term Compensation   
|---------------------------------------------------------------------------- |  | -------------- |  | - | ----------------------- |  | - | -------------------------
|
|
|
|
|Michael L. Campbell
Chief Executive Officer                                  |  | 2003
2002
2001 |  | $ | 589,100
589,100
590,432 |  | $ | 650,000
883,650
1,300,573
|Kurt C. Hall
Chief Executive Officer and President of RCM                    |  | 2003
2002
2001 |  |   | 589,100
589,100
       |  |   | 650,000
839,100
        
|Gregory W. Dunn
President and Chief Operating Officer                        |  | 2003
2002
2001 |  |   | 377,169
377,169
378,022 |  |   | 282,877
377,169
647,291  
|Amy E. Miles
Executive Vice President, Chief Financial Officer and Treasurer |  | 2003
2002
2001 |  |   | 325,000
325,000
311,538 |  |   | 275,000
325,000
532,875  
|Peter B. Brandow
Executive Vice President, General Counsel and Secretary     |  | 2003
2002
2001 |  |   | 305,000
305,000
278,077 |  |   | 228,750
305,000
518,750  

---

Option Grants in Last Fiscal Year

There were no stock option grants to our Named Executive Officers during fiscal 2003.

Aggregated Option Exercises In Last Fiscal Year and FY-End Option Values

Our Named Executive Officers did not exercise any stock options to purchase shares of our common stock during the fiscal year ended January 1, 2004 and,
because all of our post-bankruptcy grants were exchanged for option grants from REG in the exchange transaction, none of our securities were underlying unexercised stock options at fiscal
year end. Accordingly, the aggregated option exercise table has been omitted. For information regarding the REG options exercises of our Named

---

Executive
Officers during the fiscal year, please refer to REG's proxy statement for its 2004 annual stockholders meeting when it becomes available.

Director Compensation

We reimburse our directors for reasonable out-of-pocket expenses related to attending board of director meetings. We do not pay, and do
not currently anticipate paying, any other cash or equity compensation to our directors for serving on our board of directors.

Employment Contracts and Termination of Employment and Change-In-Control Arrangements

We do not have any employment agreements with our Named Executive Officers. REG, however, has entered into employment agreements with Messrs. Campbell,
Hall and Dunn and Ms. Miles, which provide for their employment as executive officers of us or our subsidiaries, as well as for REG. The terms of their employment agreements with REG are set
forth below.

REG
entered into employment agreements with Messrs. Campbell and Hall on May 3, 2002, pursuant to which Mr. Campbell will serve as our Chief Executive Officer and as
Co-Chief Executive Officer of REG, and Mr. Hall will serve as Co-Chief Executive Officer of REG and as President and Chief Executive Officer of RCM. The term of the
agreements is three years and provides for a base annual salary of $589,100 for each of Mr. Campbell and Mr. Hall, subject to subsequent annual adjustment. Each executive officer is also
eligible to receive a cash bonus each year based on performance and attainment of earnings objectives set by REG's board of directors. Each executive officer's target bonus shall be at least 100% of
his base annual salary and each executive officer's stretch bonus shall be at least 150% of his base annual salary.

If
either Mr. Campbell's or Mr. Hall's employment is terminated without cause, such executive officer is entitled to severance payments equal to two times his base annual
salary and health and life insurance benefits for 24 months from the date of the termination of his employment. Under those circumstances, each executive officer is also entitled to receive,
pro-rated to the date of termination, any bonus he would have received for that year. If either executive officer terminates his employment for good reason, he is entitled to receive, in
addition to amounts payable if REG were to have terminated his employment without cause, one times such executive officer's target bonus. Also, if REG terminates employment, or if either executive
officer resigns for good reason, within 3 months prior to, or one year after, a change of control of REG, such executive officer is entitled to receive severance payments equal to:
(i) the actual bonus, pro-rated to the date of termination, he would have received in respect of the fiscal year in which the termination occurs; and (ii) two and
one-half times his annual base salary plus two times his target bonus, and health and life insurance benefits for 30 months. Each executive officer is also subject to a noncompete
agreement under which he agrees not to compete with REG or its theatre affiliates or solicit or hire certain of REG's employees during the term of his employment agreement and for one year thereafter.

REG
entered into employment agreements with Ms. Miles and Mr. Dunn on May 3, 2002, pursuant to which Ms. Miles will serve as our Chief Financial Officer and
as Chief Financial Officer of REG, and Mr. Dunn will serve as our President and Chief Operating Officer and as REG's Chief Operating Officer. The term of the agreements is three years and the
agreements provide for base annual salaries of $377,169 for Mr. Dunn and $325,000 for Ms. Miles, subject to subsequent annual adjustment. Each executive officer is also eligible to
receive a cash bonus each year based on performance and attainment of earnings objectives set by REG's board of directors. Each executive officer's target bonus shall be at least 75% of his or her
base annual salary and each executive officer's stretch bonus shall be at least 100% of his or her base annual salary.

If
either Ms. Miles' or Mr. Dunn's employment is terminated without cause, such executive officer is entitled to severance payments equal to two times his or her base
annual salary and health and life

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insurance
benefits for 24 months from the date of the termination of his or her employment. Under those circumstances, each executive officer is also entitled to receive, pro-rated
to the date of termination, any bonus he or she would have received for that year. If either executive officer terminates his or her employment for good reason, he or she is entitled to receive, in
addition to amounts payable if we were to have terminated his or her employment without cause, one times such executive officer's target bonus. Also, if REG terminates employment, or if either
executive officer resigns for good reason, within 3 months prior to, or one year after, a change of control of REG, such executive officer is entitled to receive severance payments equal to:
(i) the actual bonus, pro-rated to the date of termination, the executive officer would have received in the fiscal year in which the termination occurs, and (ii) two times
the executive officer's annual salary plus one and one-half times the executive officer's target bonus, and health and life insurance benefits for 30 months. Each executive officer
is also subject to a noncompete agreement under which he or she agrees not to compete with REG or its theatre affiliates or solicit or hire certain of REG's employees during the term of his or her
employment agreement and for one year thereafter.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Security Ownership of Certain Beneficial Owners and Management

We are a wholly owned subsidiary of REH, which is a wholly owned subsidiary of REG. Anschutz Company, which beneficially owned as of March 10, 2003
approximately 58.1% of REG's Class A common stock, approximately 82.6% of REG's Class B common stock and approximately 78.0% of the voting power of REG's outstanding voting capital
stock, may be deemed to beneficially own our shares held directly by REH. And, Philip F. Anschutz, as the sole owner of Anschutz Company, may be deemed to beneficially own our shares beneficially
owned by Anschutz Company. The address of the Anschultz Company is 555 17th Street, Suite 2400, Denver, Colorado 80207.

The
foregoing information is based upon filings made by Anschutz Company and Mr. Anschutz with the Securities and Exchange Commission in respect of the shares of REG beneficially
owned by it and him. None of our directors or Named Executive Officers owns beneficially any of our shares of capital stock.

Equity Compensation Plan Information

We do not have any compensation plans outstanding under which our equity securities are authorized for issuance, and we have no present intention to adopt any
such plans.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Employment Agreements

In connection with its the bankruptcy reorganization, RCI entered into Employment Agreements with Messrs. Campbell and Dunn and Ms. Miles. These
agreements were superseded by the employment agreements with REG described above under the caption "Executive CompensationEmployment Contracts and Termination of Employment and
Change-in-Control Arrangements".

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Indemnification Agreements

RCI has entered into indemnification agreements with each of Michael L. Campbell, Peter B. Brandow, Gregory W. Dunn and Amy E. Miles. The indemnification
agreements provide that RCI will indemnify each of those individuals against claims arising out of events or occurrences related to that individual's service as an agent of RCI, except among other
restrictions to the extent such claims arise from conduct that was knowingly fraudulent, a knowing violation of law or of any policy of RCI, deliberately dishonest or in bad faith or constituted
willful misconduct.

Management Agreements

RCI manages the theatre operations of UATC and its subsidiaries pursuant to the terms of a management agreement. During the fifty-three weeks ended
January 1, 2004 and the forty-eight weeks ended December 26, 2002, RCI recorded management fee revenues of approximately $10.7 million and $12.4 million respectively,
related to this arrangement. Such fees have been recorded in the accompanying consolidated statements of operations as a component of "Other Operating Revenues."

Acquisitions

We became a wholly owned subsidiary of REG on April 12, 2002 in conjunction with an exchange transaction in which REG, through its wholly owned subsidiary
REH, also acquired Edwards and RCM. REG is controlled by Anschutz, which controlled each of us, Edwards and RCM prior to REG's acquisition of us and them in the exchange transaction. Following the
exchange transaction, RCI acquired all of the outstanding capital stock of Edwards, RCM, Hoyts and UATG from REH or REG in a series of transactions described in Note 4 to the accompanying
consolidated financial statements.

Other Transactions

During the fifty-three weeks ended January 1, 2004, RCM incurred approximately $2.7 million of expenses payable to an Anschutz affiliate for
telecommunication services. Additionally, RCM has recorded revenue of $0.7 million from certain affiliates of Anschutz and Oaktree's Principal Activities Group related to marketing and business
meeting services provided by RCM to these affiliates. During the year ended December 26, 2002, RCM incurred approximately $1.3 million of expenses payable to certain Anschutz affiliates
for reimbursement of travel, marketing and telecommunication expenses

Item 14. PRINCIPAL ACCOUNTANTS FEES AND SERVICES

Independent Auditors

KPMG, LLP served as our independent auditors for the fiscal years ended December 26, 2002 and January 1, 2004. For such fiscal years we paid fees
for services from KPMG as discussed below.



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Board of Directors Pre-Approval Policy

Our board of directors pre-approves all audit and permissible non-audit services provided by the independent auditors on a
case-by-case basis. These services may include audit services, audit-related services, tax services and other services. Our Chief Financial Officer is responsible for
presenting the board with an overview of all proposed audit, audit-related, tax or other non-audit services to be performed by the independent auditors. The presentation must be in
sufficient detail to define clearly the services to be performed. The board does not delegate its responsibilities to pre-approve services performed by the independent auditor to
management or to an individual member of the board.

PART IV

Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K



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|Exhibit Number |  | Description of Exhibits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|-------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.1            |  | Regal Cinemas, Inc. Amended Joint Plan of Reorganization dated December 5, 2001 (filed as exhibit 2.1 to Regal Entertainment Group's Registration Statement on Form S-1 (Commission File No. 333-84096) on March 11, 2002,
and incorporated herein by reference)                                                                                                                                                                                                                                                       
|2.2            |  | Regal Cinemas, Inc. Disclosure Statement dated September 6, 2001 (filed as exhibit 2.3 to Regal Cinemas, Inc.'s Form 10-Q for the fiscal quarter ended September 27, 2001 (Commission File No. 333-52943), and incorporated herein by reference)                                                                                                                                                                                                                                                                       
|2.3            |  | Edwards Theatres Second Amended Plan of Reorganization dated July 23, 2001 (filed as exhibit 2.5 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and incorporated herein by
reference)                                                                                                                                                                                                                                                       
|2.4            |  | Edwards Theatres Disclosure Statement to Accompany Debtor's Second Amended Plan of Reorganization (filed as exhibit 2.6 to the Registration Statement of the Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and
incorporated herein by reference)                                                                                                                                                                                                                            
|2.5            |  | Exchange Agreement, dated as of March 11, 2002, by and among Regal Entertainment Group and certain stockholders of Regal Cinemas Corporation, United Artists Theatre Company, Edwards Theatres, Inc. and Regal CineMedia Corporation (filed as exhibit 2.7
to the Registration Statement of Registrant on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and incorporated herein by reference)                                                                                                            
|3.1            |  | Amended and Restated Certificate of Incorporation of Regal Cinemas Corporation (filed as exhibit 3.1 to Regal Cinemas Corporation's Registration Statement on Form S-4 (Commission File No. 333-87930) on May 9, 2002, and incorporated herein by
reference)                                                                                                                                                                                                                                                           
|3.2            |  | Amended and Restated Bylaws of Regal Cinemas Corporation (filed as exhibit 3.1 to Regal Cinemas Corporation's Form 10-Q for the fiscal quarter ended June 26, 2003 (Commission File No. 333-87930), and incorporated herein by reference)                                                                                                                                                                                                                                                                              
|4.1            |  | Indenture dated as of January 29, 2002 among Regal Cinemas Corporation, the Guarantors party thereto and U.S. Bank National Association, as Trustee, with respect to the 93/8% Senior Subordinated Notes due 2012 (filed as
exhibit 4.6 to Regal Entertainment Group's Registration Statement on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and incorporated herein by reference)                                                                                                                     
|4.1.1          |  | First Supplemental Indenture, dated as of April 17, 2002, by and among Regal Cinemas Corporation, as Issuer, the Guarantors Party thereto and U.S. Bank National Association, as Trustee (filed as exhibit 4.7 to Amendment No. 1 to the Registration
Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on April 19, 2002, and incorporated herein by reference)                                                                                                                      
|4.1.2          |  | Second Supplemental Indenture, dated as of April 17, 2002, by and among Regal Cinemas Corporation, as Issuer, Edwards Theatres, Inc., Florence Theatre Corporation, Morgan Edwards Theatre Corporation, United Cinema Corporation, as Guaranteeing
Subsidiaries and U.S. Bank National Association, as Trustee (filed as exhibit 4.8 to Amendment No. 1 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on April 19, 2002, and incorporated herein by
reference)
|               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

---

|4.1.3 |  | Third Supplemental Indenture, dated as of November 28, 2002, by and among Regal Cinemas Corporation, as Issuer, Regal CineMedia Corporation, as Guaranteeing Subsidiary, and U.S. Bank National Association, as Trustee (filed as exhibit 4.7 to Regal
Entertainment Group's Form 10-K for the fiscal year ended December 26, 2002 (Commission File No. 001-31315), and incorporated herein by reference)                                                                                                                                                                       
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.1.4 |  | Fourth Supplemental Indenture, dated as of March 27, 2003, among Regal Cinemas Corporation, Interstate Theatres Corporation, Frederick Plaza Cinema, Inc. and U.S. Bank National Association (filed as exhibit 4.1 to Regal Entertainment Group's Form
10-Q (Commission File No. 001-31315) filed for the fiscal quarter ended March 27, 2003, and incorporated herein by reference)                                                                                                                                                                                            
|4.1.5 |  | Fifth Supplemental Indenture, dated as of June 6, 2003, among CineMedia Software, Inc., a Delaware corporation, UATG, Regal Cinemas Corporation and U.S. Bank National Association, as trustee under the Indenture referred to therein (filed as exhibit
4.3 to Regal Entertainment Group's Form 10-Q (Commission File No. 001-31315) filed for the fiscal quarter ended June 26, 2003, and incorporated herein by reference)                                                                                                                                                   
|4.2   |  | Form of Regal Cinemas Corporation 93/8% Senior Subordinated Notes due 2012 (filed as Exhibit A to exhibit 4.6 to Regal Entertainment Group's registration statement on Form S-1 (Commission File No. 333-84096) filed March 11,
2002, and incorporated herein by reference)                                                                                                                                                                                                                                                                                                     
|4.3   |  | Regal Cinemas Corporation 93/8% Senior Subordinated Notes due 2012 Registration Rights Agreement, dated January 29, 2002 (filed as exhibit 4.8 to Regal Entertainment Group's Form 10-K for the fiscal year ended December 26,
2002 (Commission File No. 001-31315), and incorporated herein by reference)                                                                                                                                                                                                                                                                      
|4.4   |  | Regal Cinemas Corporation 93/8% Senior Subordinated Notes due 2012 Registration Rights Agreement, dated April 17, 2002 (filed as exhibit 4.10 to Amendment No. 1 to the Registration Statement of Regal Entertainment Group on
Form S-1 (Commission File No. 333-84096) on April 19, 2002, and incorporated herein by reference)                                                                                                                                                                                                                                                
|4.5   |  | Third Amended and Restated Credit Agreement, dated as of August 27, 2003, among Regal Cinemas Corporation, RCI, the several lenders from time to time parties thereto, and Lehman Commercial Paper Inc., as Administrative Agent, Credit Suisse First
Boston, acting through its Cayman Islands Branch, as Syndication Agent, Sole Advisor, Sole Lead Arranger and Sole Book Manager (filed as exhibit 4.1 to Regal Entertainment Group's Form 10-Q (Commission File No. 001-31315) filed for the fiscal quarter
ended September 25, 2003, and incorporated herein by reference)
|10.1* |  | Employment Agreement, dated May 3, 2002, between Regal Entertainment Group and Michael L. Campbell (filed as exhibit 10.4 to Amendment No. 2 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on May
6, 2002, and incorporated herein by reference)                                                                                                                                                                                                                                                                       
|10.2* |  | Employment Agreement, dated May 3, 2002, between Regal Entertainment Group and Gregory W. Dunn (filed as exhibit 10.7 to Amendment No. 2 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on May 6,
2002, and incorporated herein by reference)                                                                                                                                                                                                                                                                           
|10.3* |  | Employment Agreement, dated May 3, 2002, between Regal Entertainment Group and Amy E. Miles (filed as exhibit 10.6 to Amendment No. 2 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on May 6,
2002, and incorporated herein by reference)                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

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|10.4* |  | Employment Agreement, dated May 3, 2002, between Regal Entertainment Group and Kurt C. Hall (filed as exhibit 10.5 to Amendment No. 2 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on May 6,
2002, and incorporated herein by reference)
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|21.1  |  | List of Subsidiaries                                                                                                                                                                                                                                                                              
|31.1  |  | Rule 13(a)-14(a) Certification of Chief Executive Officer                                                                                                                                                                                                                                         
|31.2  |  | Rule 13(a)-14(a) Certification of Chief Financial Officer                                                                                                                                                                                                                                         

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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.

|               |  | REGAL CINEMAS CORPORATION
|-------------- |  | -------------------------
|March 31, 2004 |  | By:                      

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.

|Signature                                 |  | Title                                                                                                                                    |  | Date          
|----------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------- |  | --------------
|                                          |  |                                                                                                                                          |  |               
|/s/MICHAEL L. CAMPBELLMichael L. Campbell |  | Director and Chief Executive Officer (Principal Executive Officer)                                                                       |  | March 31, 2004
|/s/KURT C. HALLKurt C. Hall               |  | Director                                                                                                                                 |  | March 31, 2004
|/s/AMY E. MILESAmy E. Miles               |  | Director, Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer) |  | March 31, 2004

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Exhibit Index

|Exhibit
Number |  | Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|-------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.1            |  | Regal Cinemas, Inc. Amended Joint Plan of Reorganization dated December 5, 2001 (filed as exhibit 2.1 to Regal Entertainment Group's Registration Statement on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and incorporated herein by
reference)                                                                                                                                                                                                                                                       
|2.2            |  | Regal Cinemas, Inc. Disclosure Statement dated September 6, 2001 (filed as exhibit 2.3 to Regal Cinemas, Inc.'s Form 10-Q for the fiscal quarter ended September 27, 2001 (Commission File No. 333-52943), and incorporated herein by reference)                                                                                                                                                                                                                                                                       
|2.3            |  | Edwards Theatres Second Amended Plan of Reorganization dated July 23, 2001 (filed as exhibit 2.5 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and incorporated herein by
reference)                                                                                                                                                                                                                                                       
|2.4            |  | Edwards Theatres Disclosure Statement to Accompany Debtor's Second Amended Plan of Reorganization (filed as exhibit 2.6 to the Registration Statement of the Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and
incorporated herein by reference)                                                                                                                                                                                                                            
|2.5            |  | Exchange Agreement, dated as of March 11, 2002, by and among Regal Entertainment Group and certain stockholders of Regal Cinemas Corporation, United Artists Theatre Company, Edwards Theatres, Inc. and Regal CineMedia Corporation (filed as exhibit 2.7
to the Registration Statement of Registrant on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and incorporated herein by reference)                                                                                                            
|3.1            |  | Amended and Restated Certificate of Incorporation of Regal Cinemas Corporation (filed as exhibit 3.1 to Regal Cinemas Corporation's Registration Statement on Form S-4 (Commission File No. 333-87930) on May 9, 2002, and incorporated herein by
reference)                                                                                                                                                                                                                                                           
|3.2            |  | Amended and Restated Bylaws of Regal Cinemas Corporation (filed as exhibit 3.1 to Regal Cinemas Corporation's Form 10-Q for the fiscal quarter ended June 26, 2003 (Commission File No. 333-87930), and incorporated herein by reference)                                                                                                                                                                                                                                                                              
|4.1            |  | Indenture dated as of January 29, 2002 among Regal Cinemas Corporation, the Guarantors party thereto and U.S. Bank National Association, as Trustee, with respect to the 93/8% Senior Subordinated Notes due 2012 (filed as
exhibit 4.6 to Regal Entertainment Group's Registration Statement on Form S-1 (Commission File No. 333-84096) on March 11, 2002, and incorporated herein by reference)                                                                                                                     
|4.1.1          |  | First Supplemental Indenture, dated as of April 17, 2002, by and among Regal Cinemas Corporation, as Issuer, the Guarantors Party thereto and U.S. Bank National Association, as Trustee (filed as exhibit 4.7 to Amendment No. 1 to the Registration
Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on April 19, 2002, and incorporated herein by reference)                                                                                                                      
|4.1.2          |  | Second Supplemental Indenture, dated as of April 17, 2002, by and among Regal Cinemas Corporation, as Issuer, Edwards Theatres, Inc., Florence Theatre Corporation, Morgan Edwards Theatre Corporation, United Cinema Corporation, as Guaranteeing
Subsidiaries and U.S. Bank National Association, as Trustee (filed as exhibit 4.8 to Amendment No. 1 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on April 19, 2002, and incorporated herein by
reference)
|               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

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|4.1.3 |  | Third Supplemental Indenture, dated as of November 28, 2002, by and among Regal Cinemas Corporation, as Issuer, Regal CineMedia Corporation, as Guaranteeing Subsidiary, and U.S. Bank National Association, as Trustee (filed as exhibit 4.7 to Regal
Entertainment Group's Form 10-K for the fiscal year ended December 26, 2002 (Commission File No. 001-31315), and incorporated herein by reference)                                                                                                                                                                       
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.1.4 |  | Fourth Supplemental Indenture, dated as of March 27, 2003, among Regal Cinemas Corporation, Interstate Theatres Corporation, Frederick Plaza Cinema, Inc. and U.S. Bank National Association (filed as exhibit 4.1 to Regal Entertainment Group's Form
10-Q (Commission File No. 001-31315) filed for the fiscal quarter ended March 27, 2003, and incorporated herein by reference)                                                                                                                                                                                            
|4.1.5 |  | Fifth Supplemental Indenture, dated as of June 6, 2003, among CineMedia Software, Inc., a Delaware corporation, UATG, Regal Cinemas Corporation and U.S. Bank National Association, as trustee under the Indenture referred to therein (filed as exhibit
4.3 to Regal Entertainment Group's Form 10-Q (Commission File No. 001-31315) filed for the fiscal quarter ended June 26, 2003, and incorporated herein by reference)                                                                                                                                                   
|4.2   |  | Form of Regal Cinemas Corporation 93/8% Senior Subordinated Notes due 2012 (filed as Exhibit A to exhibit 4.6 to Regal Entertainment Group's registration statement on Form S-1 (Commission File No. 333-84096) filed March 11,
2002, and incorporated herein by reference)                                                                                                                                                                                                                                                                                                     
|4.3   |  | Regal Cinemas Corporation 93/8% Senior Subordinated Notes due 2012 Registration Rights Agreement, dated January 29, 2002 (filed as exhibit 4.8 to Regal Entertainment Group's Form 10-K for the fiscal year ended December 26,
2002 (Commission File No. 001-31315), and incorporated herein by reference)                                                                                                                                                                                                                                                                      
|4.4   |  | Regal Cinemas Corporation 93/8% Senior Subordinated Notes due 2012 Registration Rights Agreement, dated April 17, 2002 (filed as exhibit 4.10 to Amendment No. 1 to the Registration Statement of Regal Entertainment Group on
Form S-1 (Commission File No. 333-84096) on April 19, 2002, and incorporated herein by reference)                                                                                                                                                                                                                                                
|4.5   |  | Third Amended and Restated Credit Agreement, dated as of August 27, 2003, among Regal Cinemas Corporation, RCI, the several lenders from time to time parties thereto, and Lehman Commercial Paper Inc., as Administrative Agent, Credit Suisse First
Boston, acting through its Cayman Islands Branch, as Syndication Agent, Sole Advisor, Sole Lead Arranger and Sole Book Manager (filed as exhibit 4.1 to Regal Entertainment Group's Form 10-Q (Commission File No. 001-31315) filed for the fiscal quarter
ended September 25, 2003, and incorporated herein by reference)
|10.1* |  | Employment Agreement, dated May 3, 2002, between Regal Entertainment Group and Michael L. Campbell (filed as exhibit 10.4 to Amendment No. 2 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on May
6, 2002, and incorporated herein by reference)                                                                                                                                                                                                                                                                       
|10.2* |  | Employment Agreement, dated May 3, 2002, between Regal Entertainment Group and Gregory W. Dunn (filed as exhibit 10.7 to Amendment No. 2 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on May 6,
2002, and incorporated herein by reference)                                                                                                                                                                                                                                                                           
|10.3* |  | Employment Agreement, dated May 3, 2002, between Regal Entertainment Group and Amy E. Miles (filed as exhibit 10.6 to Amendment No. 2 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on May 6,
2002, and incorporated herein by reference)                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

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|10.4* |  | Employment Agreement, dated May 3, 2002, between Regal Entertainment Group and Kurt C. Hall (filed as exhibit 10.5 to Amendment No. 2 to the Registration Statement of Regal Entertainment Group on Form S-1 (Commission File No. 333-84096) on May 6,
2002, and incorporated herein by reference)
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|21.1  |  | List of Subsidiaries                                                                                                                                                                                                                                                                              
|31.1  |  | Rule 13(a)-14(a) Certification of Chief Executive Officer                                                                                                                                                                                                                                         
|31.2  |  | Rule 13(a)-14(a) Certification of Chief Financial Officer                                                                                                                                                                                                                                         

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